Oil Price Surge Sparks Market Volatility Amid Rising Bond Yields

Markets have started the week off on a tumultuous note, with oil prices surging and bond yields continuing to rise. The US presidency's rejection of Iran's proposal to reopen the Strait of Hormuz has sent WTI crude up over 3% to $95.77, reigniting inflation fears.

The combination of higher oil prices and rising Treasury yields is putting pressure on risk trades, with S&P 500 futures down 0.5%. Tech shares are leading declines in US futures, while regional stocks in Europe have managed to remain steady.

Gold has taken a hit, dropping below $4,200 as technical damage mounts. The precious metal's price is now threatening key support around $4,240 and could potentially break down to the $4,000 level if it continues downward.

The market is bracing for a busy week ahead, with central banks watching inflation closely. The RBA decision tomorrow will be followed by the US PCE report on Wednesday, Micron earnings on Thursday, and the critical US jobs report on Friday.