European session: Bond yields climb, gold slides 3.1%, oil jumps 3.6%, tech futures fall

Session highlights:

Market snapshot:

• Gold declined 3.1% to $4,151
• WTI crude rose 3.6% to $95.77
• The yen led gains, while the Swiss franc lagged
• 10-year Treasury yields climbed 3.6 bps to 5.217%
• European equities held steadier; S&P 500 futures fell 0.5%
• Bitcoin dropped 1.8% to $82,959

The new trading week has started, but many of the same market themes continue.

US President Trump rejected Iran's proposal to reopen the Strait of Hormuz, which has pushed oil prices higher again and added to the bond market pressure that has been building since late last week.

WTI crude has risen over 3% to $95.77, rekindling inflation fears and keeping central banks vigilant as the fourth quarter begins. At the same time, the bond market selloff continues, with the 10-year Treasury yield climbing back above 5.21% and briefly touching 5.23% earlier, its highest since 2007.

The combination of higher oil prices and higher bond yields remains a major drag on risk trades, pulling US futures lower again. Stocks are hurting as higher rates pressure valuations and raise borrowing costs. S&P 500 futures dropped 0.5%, with technology shares leading the declines, while Nasdaq futures fell 0.8%.

In Europe, investors have held their nerve somewhat, with regional stocks staying steadier. However, given the broader market mood, the slight gains are not particularly exciting.

In currency markets, the yen is back in focus after Japan's top currency diplomat Mimura intervened verbally once more. That pushed USD/JPY from 157.50 to 156.50 during the session before it settled near 157.00.

Gold is under heavy pressure as hopes for US-Iran diplomatic progress wane and higher bond yields weigh on the metal, along with a major technical breakdown. The drop below $4,200 threatens to take out key support near $4,240, shifting attention to the next major support level around $4,000.

This week is packed with events: the RBA decision tomorrow, the US PCE report and Micron earnings on Wednesday, and the US jobs report on Friday. Additionally, month-end and quarter-end dynamics will come into play.

Therefore, expect significant volatility in the days ahead.