Brent Crude Surges Past $90 as Bond Markets Feel the Heat

Global bond markets are feeling the strain as Brent crude oil futures surged to US$90.58 per barrel, a 2.1% increase from the previous day's close. The rise in energy prices weighed heavily on Northern Hemisphere markets, with stock markets in the US and Europe experiencing losses and long-dated government bond yields hitting fresh multi-decade highs.

The yield on the US 30-year government bond rose to its highest level since 2007, reaching 5.31% at 7am in Auckland. Bank of New Zealand senior market strategist Jason Wong attributed this move to a global repricing of the term premium, which is the compensation investors demand for taking duration risk.

In other news, Alphabet plans to tap Australian investors with an A$5 billion bond offering, while Shein Global Holdings aims to raise between US$26b and US$27b in its initial public offering in Hong Kong. The tech-heavy Nasdaq Composite fell 0.3% in late trading.