Oil Prices Fuel Global Bond Market Jitters Amid Inflation Fears

The global bond market is experiencing high yields due to rising oil prices and concerns about inflation. The US administration's decision to impose higher tariffs on goods from 60 trading partners has also contributed to these fears. As a result, 30-year Treasury yields have reached their highest level since 2007, while German 10-year Bund yields are near their highest since 2011.

Despite these concerns, the pan-European STOXX 600 rose 0.3% after a drop in the last session. Stock index futures on Wall Street also pointed to a slight rebound after Thursday's weakness. Intel's premarket trading saw a near 4% jump, driven by bumper results.

However, tech stocks have been under pressure this week due to investors' growing unease about multi-billion-dollar spending on AI that has yet to yield conclusive evidence of paying off. President Donald Trump threatened 'major military punishment' for Iran and its allies, while the US military conducted a 13th consecutive night of attacks.

Data offered a more optimistic economic outlook, with surveys showing Germany's private sector returned to growth in July for the first time in four months and contraction in France's private sector eased this month. Markets show traders believe central banks are more likely to raise borrowing costs, with a one-in-three chance of a rate hike from the Fed as soon as next week.