Treasury yields climb, stocks slide as risk appetite fades

Key market moves:

Markets:

• 10-year Treasury yields +6 bps to 5.34%
• WTI crude up 0.7% to $90.06
• USD leads, EUR lags on the day
• Gold down 1.1% to $4,118
• European equities lower; S&P 500 futures -0.4%
• Bitcoin down 2.3% to $83,653

The bond market continues to dominate trading this week. Long-end Treasury yields are again attempting a fresh upside breakout, with 10-year yields jumping to 5.34% and 30-year yields racing to 5.72%—both hitting their highest levels since 2002.

That is keeping broader markets on edge and weighing on risk sentiment today.

European stocks started on the backfoot, with France's fiscal concerns still dampening risk appetite in the region. Those losses are now being compounded as higher rates put a heavier anchor on equities. Major indices are posting losses of over 1% across the board, as valuations come under pressure alongside tighter financial conditions from elevated rates.

US futures have also darkened, with S&P 500 futures falling 0.4% and Nasdaq futures down 0.7% after a more tentative start earlier in the day.

In currencies, the dollar is again benefiting from the rise in Treasury yields, pushing gains across the board. EUR/USD is down 0.6% to 1.1185, while USD/JPY is up 0.2% to 158.35. The euro's woes are also being compounded by French fiscal risks, which threaten to spill over into the rest of the region.

In commodities, oil prices are settling higher with Brent crude pushing back above $102 today, as traders weigh fresh Houthi attacks on Saudi Arabia alongside a potential supply disruption from a storm approaching the Gulf of Mexico. Meanwhile, gold is down over 1% to $4,118, as the non-yielding precious metal comes under pressure from higher bond yields.

With the bond market selling off again, all eyes will be on the 10-year Treasury auction and FOMC meeting minutes release later today.