Oil Prices, Rate Hike Fears Weigh on Global Markets
Rising crude oil prices and surging bond yields have weighed heavily on global financial markets ahead of key interest rate decisions by central banks. The US Federal Reserve's anticipated rate hike has seen its expectations edge down from Monday's highs, but remains overwhelmingly likely at 92.5% as tracked by the CME FedWatch tool.
The looming rate hike and anxiety surrounding AI themes have contributed to a negative market sentiment, with Wall Street futures trading in negative territory and major European benchmarks mostly lower. Asian markets had finished trading on a heavily negative note earlier in the day.
Crude oil prices have increased amidst concerns over energy supply from the Middle East region. The US 10-year yield has touched its highest level since 2007, with sovereign bond yields hardening across tenors in the US but moving mixed elsewhere. Gold has slipped more than half a percent, while cryptocurrencies are trading mostly negative.
The six-currency Dollar Index has gained close to a quarter percent, while major currency pairs such as EUR/USD and GBP/USD have seen declines. Commodities like Brent Oil Futures and Crude Oil WTI Futures have increased in price, with Gold and Silver futures slipping.