Oil breaks US$100, Wall Street retreats and bond yields rise, inflation is becoming the market’s biggest risk again Global markets are starting Thursday in a more defensive position. Brent crude has broken above US$100 a barrel , U.S. Treasury yields are pushing higher, and Wall Street fell for a third straight session as investors reassess whether central banks may need to keep tightening rather than easing. For Malaysian investors, the key chain today is increasingly clear: Oil → inflation → interest rates → bond yields → USD/MYR → Bursa valuations. 30-second market snapshot Market / Asset Latest 🇺🇸 S&P 500 7,636.36, -0.48% 🇺🇸 Dow Jones 52,380.66, -0.77% 🇺🇸 Nasdaq 26,253.34, -0.64% 🇲🇾 FBM KLCI 1,714.34, virtually flat 💵 USD/MYR ~4.06 🇺🇸 U.S. 10Y Treasury ~4.84% 🇺🇸 U.S. 2Y Treasury ~4.42% 🥇 Gold ~US$4,396/oz 🛢️ Brent crude US$101.21/bbl 🛢️ WTI crude US$96.05/bbl ₿ Bitcoin ~US$79,300 🇯🇵 Nikkei ~64,760, -0.6% this morning Brent jumped about 3.4% Wednesda...
Global stocks surged to a new peak on Tuesday after China unveiled significant stimulus measures aimed at revitalizing its economy and stabilizing its stock markets. The move sent Asian and European shares higher, triggering a strong rally in commodity prices as investors reacted positively to the announcements.
The People's Bank of China (PBOC) governor, Pan Gongsheng, revealed plans to lower borrowing costs, inject more funds into the economy, and ease mortgage repayment burdens for households. Additionally, China plans to introduce new structural monetary policy tools to help stabilize its capital markets, a first for the country. These actions sent Chinese stocks soaring, with the CSI300 and Shanghai Composite indexes both rising over 4%, while Hong Kong’s Hang Seng Index climbed more than 4% to reach a four-month high.
"Investor positioning in China stocks has been underweight, and the new stimulus measures provide a positive backdrop for the coming months," said Jefferies economist Mohit Kumar. However, he noted that the stimulus wasn't a "bazooka" and that more targeted measures, particularly for property and infrastructure, would be needed to fundamentally alter the outlook for China.
Despite the stimulus, Chinese stocks have lagged behind other Asian markets, with the CSI300 index down 2.3% this year after hitting multi-year lows. The piecemeal stimulus provided by authorities earlier failed to galvanize the markets, but this latest effort seems to be having a more positive impact.
In Europe, the pan-European STOXX 600 index rose 0.8%, led by gains in China-exposed mining and luxury stocks. Germany's DAX index traded just below its all-time high, adding to the bullish sentiment across global markets. The MSCI world stocks index also gained 0.3%, reaching a record high. In the U.S., futures pointed to a strong opening on Wall Street, continuing the global uptrend.
The upbeat sentiment also lifted commodity prices, with oil prices up nearly 1.5% and copper prices jumping to a two-month high due to expectations of increased demand from China. Iron ore futures on China's Dalian Commodity Exchange saw their largest intraday gain in over a year, while gold prices paused after hitting a record high of US$2,639.95, driven by rising tensions in the Middle East.
Elsewhere, the Reserve Bank of Australia (RBA) held its interest rates steady, diverging from the U.S. Federal Reserve, which initiated its easing cycle with a 50-basis-point cut last week. The Australian dollar slipped slightly, while the U.S. dollar touched a 20-day high against the yen.
As global markets continue to react to economic policies and data, the focus remains on whether the U.S. Federal Reserve will continue cutting rates. Investors are split on whether the next cut in November will be 25 or 50 basis points. The non-farm payrolls report due on October 4 is expected to provide further clarity on the Fed's direction.
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