European session: dollar firms, yields push higher, Brent tops $100, stocks slide

Headlines:

Market update:

• Brent crude gained 0.9%, reaching $100.17
• The dollar led the way, with the yen at the back
• Gold fell 1.3% to $4,300
• Ten-year Treasury yields rose 1.3 bps to 4.98%
• European stocks were lower, with S&P 500 futures down 0.1%

Trading got underway on a calmer note, with investors resuming from the previous session. Oil was softer, as Brent stayed below $100, and equities proved steadier once European markets opened.

Yet with US-Iran diplomatic hopes still under review, the bond market is denying traders any respite. Treasury yields remain just under 5%, and European yields are also edging up. German 10-year yields are up nearly 5 bps to 3.49%, while French 10-year yields have added 5 bps to 4.54%.

It did not take long for oil to turn higher, reaffirming the bond yield advance. Brent has climbed back above $100, after starting European trade near $98.50.

The twin moves in oil and bonds are again reviving inflation concerns, which is weighing on risk appetite. Today's euro area PMI data also points to stronger activity and rising price pressures across the region's major economies, keeping the debate on a possible ECB rate hike in October alive.

The dollar is pushing higher, dragging stocks lower in the process. USD/JPY is closing in on 158.00, while EUR/USD is drifting toward the 1.1400 handle. European benchmarks are losing ground after a lackluster open, and US futures have turned negative after a firmer start to the day.

Tech stocks have held up well so far this week, but the threat of another rise in yields shows how quickly sentiment can shift. S&P 500 futures are 0.1% lower, and Nasdaq futures are off 0.3%.

Elsewhere, gold is under pressure, falling more than 1% to near $4,300. Bitcoin is also down nearly 1%, trading around $85,490.

After a period of relative calm in recent sessions, the bond market's persistent unease is starting to unnerve broader markets once again.