Stocks, bonds fall as brent oil jumps above $100

As per the latest business developments, Stocks joined bonds softer as crude prices rallied, fueling concerns around inflationary pressures that could make the The US central bank raise rates.

Brent crude topped $100 a barrel as fresh tensions between the US and Iran heightened worries around energy flows through the Strait of Hormuz. The S&P 500 declined for a third straight session. Treasury 10-year yields hovered near the highest since 2023. In the run-up to inflation data, money markets assigned a roughly 60% probability of a September Fed hike.

The US attacked more Iranian oil tankers overnight, destroying five vessels in response to the Islamic Revolutionary Guard Corps targeting one of its warships. The tit-for-tat strikes underscored the difficulty to pivot from active hostilities to a sustained campaign of economic pressure against Tehran.

“The temperature just got turned up again,” stated Kenny Polcari at SlateStone Wealth. “The risk premium is alive and well and the risk to energy supplies coming out of the Gulf is real.”

Meantime, the dollar neared its lowest in around seven months as the yen rose. Treasury Secretary Scott Bessent challenged traders to test his resolve on boosting Japan’s currency, saying when he wades into markets these days he’s effectively doing so with inside information.

Bessent is additionally set to reveal how far he’s initially willing to go to restrain US bond yields through an expanded buyback program. The Treasury Department plans to announce the revised size of Thursday’s buyback of 10- to 20-year debt — which was set at $2 billion when announced last month — at 11 a.m. in Washington.

The surge in crude prices comes just as traders brace for key inflation notes the current week.

With Fed officials concerned by persistently high inflation, but divided over how monetary policy should respond in the near term, new evidence of price pressures could tilt the Federal Open Market Committee into a interest-rate gain. Cooler notes are likely to keep the Fed on hold, as it’s been through five previous meetings this year.

The Bureau of Labor Statistics will release August data for the producer price index on Thursday, followed by the consumer price index on Friday.

“A hot CPI print would all but seal a September hike and underpin a firmer dollar,” stated Elias Haddad at Brown Brothers Harriman & Co. “A cooler reading would strengthen the case for a hold and leave the dollar vulnerable to a dovish Fed repricing.” Corporate Highlights:

Apple Inc.’s $570 billion summer surge is saddling new Chief Executive Officer John Ternus with high expectations heading into the firm’s most anticipated event in years: the unveiling of the foldable iPhone on Wednesday.

Alphabet Inc.’s Google is spending €13 billion ($15.1 billion) on artificial-intelligence infrastructure in Finland, its biggest European investment, as the Nordic country’s cold climate and carbon-free power make it a magnet for data center builders.

Dell Technologies Inc. is seeking to mobilize around $4 billion from an investment-grade bond sale, joining a wave of issuers seeking to refinance debt as it rides an AI-fuelled boom in demand for servers.

Amazon.com Inc. is anticipated to mobilize £4.25 billion ($5.8 billion) from its debut sterling bond sale, increasing the size of the four-part deal even as orders from market participants eased slightly.

Dow Inc. is considering plans to exit its $20 billion chemicals partnership with Saudi Aramco, people familiar with the matter stated, as part of the US firm’s efforts to reshape its portfolio amid a prolonged downturn in the industry.

Some of the main moves in markets:

The S&P 500 declined 0.3% as of 10 a.m. New York time

The Nasdaq 100 was little changed

The Dow Jones Industrial Average declined 0.7%

The Stoxx Europe 600 declined 1.3%

The MSCI World Index declined 0.4%

The Bloomberg Dollar Spot Index declined 0.2%

The euro rose 0.2% to $1.1646

The British pound rose 0.1% to $1.3557

The Japanese yen rose 0.4% to 153.31 per dollar

Bitcoin rose 0.9% to $79,186.48

Ether rose 0.9% to $2,505.21

The yield on 10-year Treasuries advanced one basis point to 4.80%

Germany’s 10-year yield advanced four basis points to 3.41%

Britain’s 10-year yield advanced four basis points to 5.21%

West Texas Intermediate crude rose 3% to $95.84 a barrel

Spot gold rose 1.3% to $4,411.97 an ounce