Bitcoin Jumps 20%, Global Equities Rebound as US Treasury Seeks to Calm Markets

Global equities made a comeback on Friday, following a volatile week, as investors weighed the impact of higher borrowing costs and the US Treasury's efforts to calm bond markets. The S&P 500 gained 0.5%, while the Dow Jones Industrial Average rose 0.8% and the Nasdaq Composite added 0.4%. Bitcoin led the charge, surging nearly 6% to $77,000 and posting a 20% weekly gain, its strongest since 2023.

The rally was helped by the US Treasury's decision to increase purchases of its own bonds, aimed at injecting liquidity into the market and easing pressure on longer-term yields. However, investors are now looking to Treasury Secretary Scott Bessent's promised measures to bring down long-term borrowing costs and next week's Jackson Hole gathering of central bankers for clues on the future path of monetary policy.

Analysts remain divided on the impact of these developments. Thahbib Rahman at Block Scholes noted that the scale of the Treasury's purchases remains small relative to the market, while Joe Maher at Capital Economics expects long-dated Treasury yields to stabilise in the coming weeks as some of the recent turmoil eases.