financetom
World
financetom
/
World
/
Morning Bid: Oil batters bonds as AI burns cash
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
Morning Bid: Oil batters bonds as AI burns cash
Jul 23, 2026 10:25 PM

A look at the day ahead in European and global markets from Stella Qiu

We are back to war watching, as if the June ceasefire never happened. After weeks of dozing through simmering U.S.-Iran tensions, investors got a rude awakening overnight: oil prices surged 7% to top $100 a barrel, and inflation is again on everyone's list of fears.

The shock came from the Red Sea, where Iran-aligned Houthis attacked two Saudi oil tankers, threatening to choke off another vital Middle East artery for global oil supplies. President Donald Trump was not subtle, threatening "major military punishment" and fuelling fears the conflict is widening.

With the world already running low on oil reserves, the risk is that a protracted energy shock stokes global inflation and de-anchors inflation expectations, a central bank's nightmare. Brent is up nearly 40% this month.

Longer-dated Treasuries bore the brunt of the selling, with 30-year Treasury yields now marching towards a 19-year peak of 5.201%. Benchmark 10-year yields hit a new 18-month top of 4.7135% on Friday.

Any lingering hopes of central bank policy easing have evaporated. Markets now see a one-in-three chance of a rate hike from the Federal Reserve as soon as next week, a sea change from merely a week ago, and are fully priced for two moves by January next year.

The broader worries of oil and rates sent Asian shares deep in the red, with South Korea's KOSPI down 6% and Japan's Nikkei sliding 2.8%. Local semiconductors couldn't even find relief in Intel Corp's ( INTC ) bumper results that sent its shares up over 4% after the bell.

Adding to the gloom, the AI trade is showing further signs of fatigue, with investors growing uneasy about higher capex plans by tech giants. Tesla shares tumbled around 14% on Wall Street after it posted its first cash burn in two years. Alphabet fell about 7%, with the Google parent also burning through cash as it ramped up AI spending.

Amid all the mayhem Trump's latest tariff wheeze raised barely an eyebrow, though the timing of making U.S consumers pay yet more for imports seems economically dubious.

Nasdaq futures are a shade lower, but European bourses are headed for a steady open. All eyes are on PMI surveys due in Europe, Britain and the United States.

The U.S. measure is seen holding on to its relative strength. Any upside surprises could see investors push the chance of a July Fed rate hike to 50/50.

Key developments that could influence markets on Friday:

-- UK retail sales data for June

-- UK, EU, US flash manufacturing, services and composite PMIs for July

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
Oil prices head for weekly rise on Middle East escalation
Oil prices head for weekly rise on Middle East escalation
Jul 24, 2026
BEIJING/SINGAPORE, July 24 (Reuters) - Oil futures prices retreated on Friday but are still set for hefty weekly gains because of concerns about disrupted energy flows in the Red Sea and fears of further escalation in the U.S.-Israeli war on Iran. Brent futures fell $1.12, or 1.11%, to $99.55 a barrel at 0648 GMT, having settled up 7% above $100...
Morning Bid: Oil batters bonds as AI burns cash
Morning Bid: Oil batters bonds as AI burns cash
Jul 23, 2026
A look at the day ahead in European and global markets from Stella Qiu We are back to war watching, as if the June ceasefire never happened. After weeks of dozing through simmering U.S.-Iran tensions, investors got a rude awakening overnight: oil prices surged 7% to top $100 a barrel, and inflation is again on everyone's list of fears. The...
EMERGING MARKETS-Asian stocks retreat as oil spike compounds tech selloff
EMERGING MARKETS-Asian stocks retreat as oil spike compounds tech selloff
Jul 24, 2026
(Drops extraneous words in paragraph 5) * S.Korean stocks end week 1.9% lower * Philippine peso close to record low of 61.933/USD * Indonesian stocks mark steepest fall since early July By Shivangi Lahiri July 24 (Reuters) - Emerging Asian equities returned to negative territory on Friday, led by South Korea, as higher oil prices rekindled inflation concerns and heavy...
GLOBAL MARKETS-Asian stocks sink, bonds struggle as oil spike stokes rate risks
GLOBAL MARKETS-Asian stocks sink, bonds struggle as oil spike stokes rate risks
Jul 23, 2026
(Updates prices before European open) * Brent holds above $100/bbl on more shipping disruptions * Japan's Nikkei slides nearly 3%, South Korea down almost 5% * Markets see one-in-three chance of Fed rate hike next week * Yen languishing at 40-year lows as dollar gains By Stella Qiu SYDNEY, July 24 (Reuters) - Asian shares sank on Friday as a...
Copyright 2023-2026 - www.financetom.com All Rights Reserved