Global equities fell to their lowest level in a week as rising oil prices and growing expectations of additional United States interest-rate increases pushed Treasury yields to multi-year highs and weakened investor appetite for riskier assets.
The MSCI All Country World Index declined 0.2 per cent, reaching its lowest point since September 18.
Asian equities dropped one per cent, while Nasdaq 100 futures declined 0.4 per cent, pointing towards further weakness on Wall Street following Monday’s technology-led losses. Pasted markdown
European markets were also heading towards a subdued opening.
US 10-Year Yield Hits Levels Not Seen Since 2007
Government bonds stabilised during Asian trading after suffering sharp losses in New York.
The benchmark US 10-year Treasury yield increased one basis point to 5.25 per cent, after reaching its highest level since 2007 on Monday.
The 30-year Treasury yield added another basis point to 5.56 per cent.
The US dollar also strengthened against most major currencies. Pasted markdown
Bond yields have been pressured by expectations that persistent inflationary risks could require the Federal Reserve to maintain tighter monetary conditions.
Higher Treasury yields can weigh on equities because they increase borrowing costs while offering investors potentially more attractive returns on relatively lower-risk government securities.
Oil Adds to Inflation Concerns
Energy prices provided another source of pressure.
Brent crude gained almost two per cent to approximately $107.30 per barrel as optimism over an imminent diplomatic breakthrough in the Middle East faded.
Higher oil prices can increase transportation and production costs throughout the global economy, complicating central banks’ efforts to control inflation.
The report said climbing energy prices, stronger US business activity and concerns over elevated government debt had contributed to the largest Treasury sell-off since President Donald Trump’s April 2025 tariff rollout. Pasted markdown
Markets will consequently remain sensitive to developments in energy prices, US monetary policy and the Middle East as investors assess whether inflationary pressure will keep global borrowing costs elevated for longer.
