Crude Oil Price Surge Weighs on Global Stock Markets
Stock markets around the world are experiencing pressure due to rising crude oil prices. The S&P 500 Index is down by -0.36%, the Dow Jones Industrial Average is down by -0.44%, and the Nasdaq 100 Index is down by -0.55%. December E-mini S&P futures are also down, while December E-mini Nasdaq futures have fallen even further.
The increase in crude oil prices has led to concerns over inflation and pushed up bond yields globally. WTI crude is up more than +2% today after an Iranian official warned that Iran may expand the war to the Indian Ocean if the US or Israel attacks again. This development has sparked a sell-off in global bond markets, with the 10-year T-note yield climbing to a 19-year high of 5.15%, and the German 10-year Bund yield rising to a 17-year high of 3.59%.
The surge in bond yields is having an impact on interest rate-sensitive technology stocks, which are retreating due to concerns over higher borrowing costs. New York Fed President John Williams has also made hawkish comments, signaling that he favors additional Fed rate hikes and indicating that the central bank still has a lot of work to do given high energy prices and demand driven by investment in artificial intelligence.