Oil prices rise on Iran tensions as US 10-year yield tops 5%
Oil prices climbed above $96 per barrel after President Trump stated a deal with Iran was unnecessary, while US Treasury yields surged with the 10-year mark exceeding 5%. The move reflects growing market expectations of a Federal Reserve rate hike in December.
Oil prices rose 3.6% to over $96 per barrel after Donald Trump stated that a deal with Iran was not necessary. American Airlines shares fell 5.6% in response to the energy cost increase. US Treasury yields increased by 9 to 13 basis points, with the 10-year yield rising above 5% to 5.13%. The market is pricing in a Federal Reserve interest rate hike on December 9. Mortgage rates are at their highest levels since 2000, and home sales are at their lowest since 2010.
Gold fell 2.9% and Bitcoin dropped nearly 4% as the dollar strengthened. The DAX index in Germany hit a record high above 27,000 points before closing at 26,772, driven by strong results from Munich Re, which rose 3%, and Allianz and Siemens, which both rose 2%. The divergence between energy-sensitive equities and European industrial stocks highlights the mixed economic signals currently driving global markets.