Dollar firms and oil bounces as US bond holiday keeps Europe's session quiet

Market snapshot:

• WTI crude up 1.4% at $92.99
• Dollar strongest among majors, Swiss franc weakest
• Gold down 0.5% at $4,170
• European shares higher, S&P 500 futures up 0.1%
• Bitcoin down 0.3% at $83,345

European trading was subdued in the morning session as markets faced a partial US holiday at the start of the new week.

US bond markets are closed for Columbus Day, and while the stock market remains open, investors are missing one key input for broader markets. That absence is significant because surging Treasury yields have been a major driver of sentiment over the past few weeks.

With that signal out of the picture, there is some room for broader markets to take a breather. At the same time, thinner liquidity could make price swings bigger as the new week gets moving.

Crude prices fell at the start of the day but have since recovered, now trading more than 1% higher. Early losses were driven by hopes for a Russia-Ukraine energy ceasefire, but attention then shifted back to the Middle East, where supply disruptions continue to weigh on sentiment. WTI fell to just under $90 earlier and has climbed back to roughly $93.

The dollar, meanwhile, is a touch firmer, posting modest gains across the major currencies. USD/JPY is up 0.2% to 158.60, while EUR/USD is down 0.2% to 1.1175, so the moves are not particularly impressive at this stage.

European equities have made a modest start after a difficult week of trading. Regional bond yields are still applying pressure, but the broader mood is giving investors some comfort, at least for now. Futures on the S&P 500 have added 0.1%, while Nasdaq contracts are 0.2% lower so far on the day.

In commodities, gold is down 0.5% at $4,170 after yet another rejection in the $4,200-20 region.

With the bond market sidelined until tomorrow, today's moves should not be overinterpreted. Thin liquidity could exaggerate swings in the session ahead, making it harder to tell whether any of the moves carry real conviction.

The first thing to watch is how Treasury yields react when trading resumes tomorrow. That should offer a clearer read on whether today's calmer tone can last, especially with price pressures and the Fed's policy outlook still hanging over the market.

After that, attention quickly turns to Wednesday's US CPI report, which should help set the tone for the rest of the week.