Global markets navigated a mixed session as significant developments unfolded. US Treasury actions on bonds provided some relief, while geopolitical tensions escalated, particularly concerning the Middle East. Economic data releases offered a clearer picture of labor market conditions.
Oil prices saw a notable surge, with Brent topping $93 and then $94. This climb was attributed to middle East supply concerns amid the US-Iran impasse and new US actions announced against the Iranian economy. Supertanker prices reached record highs as a result.
US Initial Jobless Claims fell to 206K, surpassing expectations, indicating a tightening labor market. However, continuing claims rose, suggesting some underlying weakness. Separately, the US August Philly Fed business index came in strong at +47.4, well above forecasts.
Bond markets experienced significant movement. Global yields retrenched from multi-decade peaks after the US Treasury initiated buybacks to soothe bond jitters. This led to the dollar hitting a three-month low, with gold holding near a two-month high. FOMC minutes later revealed officials saw a need for rate hikes if inflation doesn't cool, citing inflation risks skewed to the upside due to AI.
Walmart reported a rare comparable sales miss as consumers cut spending, causing its shares to fall. On the upside, Deere beat estimates and updated its outlook.
Watch for further details on US Treasury plans and evolving Middle East dynamics.