Global Markets Slide as Bond Selloff Intensifies; Gold is Strong, Hits Record

Global Markets – Rising yields, Fed jitters, and geopolitical tensions drive a risk-off mood across major financial markets. (Source: Dow Jones & Company, Inc. )

MARKETS SNAPSHOT:

• Stocks: Lower amid global bond rout

• Bonds: Yields surge on fiscal concerns

• Gold: Hits record high on safe-haven demand

• Oil: OPEC+ meeting in focus amid glut worries

U.S. Stocks Drop as Treasury Yields Climb

U.S. stocks opened September with losses, pressured by a global bond selloff and investor anxiety over ongoing efforts to reshape leadership at the Federal Reserve. The decline coincided with a sharp rise in long-dated Treasury yields, reflecting growing concerns over fiscal sustainability.

Global Bond Rout Intensifies

Sovereign bonds faced heavy selling pressure worldwide on worries over expanding government deficits:

• U.K.: 30-year gilt yields hit their highest level since 1998

• Germany: 30-year yields reached their highest since 2011

• France: 30-year yields climbed to their highest since 2009

The selloff highlighted mounting investor fears that governments across major economies are struggling to control public debt.

Gold and Miners Glisten on Safe-Haven Demand

Gold prices surged to a record high, driven by expectations of interest-rate cuts, global trade uncertainty, and robust central bank buying. The rally also lifted shares of major gold-mining companies, making them top performers in the equity market.

Key Economic Data and Central Bank Watch

Eurozone: Annual inflation accelerated slightly last month, cementing expectations that the European Central Bank will leave interest rates unchanged at its meeting next week. Separately, the eurozone jobless rate fell to match a record low in July, underscoring the resilience of the labor market despite weak economic growth.

Asia: A private gauge of China’s manufacturing activity rose to a five-month high, though doubts remain about the sustainability of the rebound. South Korea’s inflation eased to a nine-month low, remaining below the central bank’s target and paving the way for potential rate cuts.

Geopolitical and Trade Developments

Russia-China Pipeline: Russia and China advanced plans for a long-delayed pipeline to transport Russian fuel, though core terms remained unresolved in a sign of Beijing’s growing leverage in the relationship.

EU-South America Trade: The European Union is moving forward with a long-awaited trade agreement with South American nations, set to be presented Wednesday. The push comes as Brussels races to secure trade deals amid rising tensions with the U.S.

Oil Markets: OPEC+ is set to hold output steady at its upcoming meeting as anxiety over a global supply glut grows. Meanwhile, a thriving black market for oil is blunting the impact of recent tariffs aimed at punishing India for buying cheap Russian crude.

Japan’s Yields: Surging Japanese government bond yields are raising concerns that domestic investors may pull back from U.S. Treasuries to focus on their home market, potentially adding to upward pressure on U.S. borrowing costs.