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Investors start to worry about 6% Treasury yields as 5% Treasury yields begin to lose their shock value.
For years, the 5% benchmark US 10-year Treasury rate was seen as the threshold at which the global financial markets began to experience turbulence. This threshold is now 'becoming less of a ceiling, and more like an 'approach point. Investors are now forced to consider an unsettling thought: what if the number 6% should keep them awake at night instead of this month's breaching 5%? This theory hasn't been tested enough by the latest move above 5%. Mike Bell, BlueBay Asset Management’s head of Market Strategy, says that it was always a psychological indicator and not a tripwire. Bell explained that people think there is a magic number at which Treasury yields become a problem. "But it's not an absolute number but a relative one," Bell said. It is important to compare Treasury yields with other investment metrics. This includes the earnings yield of stocks. Bell claims that the relationship is approaching an inflection, which could set up a selloff of stocks. The past can provide some useful guidance. MSCI's world stock index lost half its value when the 10-year Treasury yield crossed 5%. This was right before the global financial crisis. A similar decline occurred less than a ten-year-old when a 6.8% increase helped burst the dotcom boom. JP Morgan analysts believe that a "key shift" in global economic structure, where AI, healthcare, and services play a larger role, is one reason why the pain point might be higher than 5%. These firms continue to spend and expand, regardless of how high borrowing costs are. JP Morgan stated that the traditional interest rate channel "looks materially less bound" and the "breaking-threshold" of the?stock market may be "significantly higher", potentially in the 5,5%-6,0% range, JP Morgan cited the views of major investors during one of their most recent conferences. REASONABLE REPRICING A shift from 5% to 6.0% in the $29 trillion Treasury market, which anchors the pricing of virtually all financial assets would be a significant adjustment to the global capital cost. A Treasury yield of 6% would indicate either higher inflation expectations or growing concerns over US fiscal sustainability. It could also mean that rates will continue to rise for many years. Austan Goolsbee, a Federal Reserve policymaker, said that he did not know if markets would react differently if 5% yields were extended for a longer period than in the past. Invesco's global head of asset-allocation research, Paul Jackson, explained that investors are focused on Treasury yields because they represent the risk-free benchmark for the world. At above 5%, investors have the opportunity to lock in their highest returns since 2007. Jackson's calculations indicate that world stocks begin to fall when the 10-year yield averages 4.72% over 12 months, and then increases. The tipping point is still a long way off - the average 12-month yield is around 4.34%. But Jackson has already started to reduce his stock holdings and put some of his money in government bonds, hoping to take advantage of the high yields. He said that if?Treasury Yields continue to rise, there is a danger of the stock market being lower in 12 month's time. Emerging Questions When US yields rise, emerging markets that have been on a 'hot streak' in recent years are often the first to be affected. Dollar-denominated investments become more appealing when Treasury returns are higher. This drains capital from EM economies, and can push hard-up nations into crisis if their dollar-denominated loans spiral out of control. Last week, data on?investment flow shows that billions of dollars were withdrawn from equity and EM bond funds. The issuance of emerging-market sovereign bonds has also been lighter than usual in this month. Alison Shimada is the Head of Total Emerging Markets Equity at Allspring Global Investments. She said that while EM was not in a good place, she was still "constructive" because for now, nothing "horribly went wrong". The biggest psychological risk is the most likely. When investors start to ask if 6% is achievable, the discussion moves beyond a "temporary" spike in yields. The discussion shifts to the possibility that the 'era of ultra-cheap and abundant liquidity has ended. This will force global asset prices adapt to a permanent higher cost of capital. Premier Miton CIO Neil Birrell stated that while the stock market is not showing signs of collapse right now, this could be because investors haven't yet plugged in 5% plus yields to their long-term profit forecasting model. Birrell stated that "the markets appear fine until everyone runs their valuation models again." "The numbers will come out in the end."
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The oil prices drop as Iran declares it is willing to negotiate to end the conflict
Oil prices fell on Thursday, after rising 4% in the previous session. Iran has said that it is open to diplomacy for the end of the US-Iran conflict. However, the two countries are still far apart about how to achieve this. Brent crude futures dropped 92 cents or 0.9% to $102.16 per barrel at 0400 GMT. West Texas Intermediate futures were down 77 cents or 0.8% to $91.39. Iran and the United States are divided over how to end their war. Diplomacy, however, must continue. Officials in Tehran said they were reviewing Washington's response to their peace proposals. These included lifting the US naval blockade of Iranian ports and opening up the Strait of Hormuz. Oil is falling as the'market is unwinding a part of its geopolitical premium, as Gulf supply is recovering and hopes for a US-Iran 'diplomatic breakthrough are growing," said Priyanka Sachdeva. Sachdeva continued, "Brent has a higher geopolitical premium and a greater sea route premium as international crude is directly exposed to Middle East disruption and the Hormuz Strait while WTI benefits from the relatively insulated US oil supply." Mohsenrezaei, Iran's chief of security, said earlier on Wednesday that the Strait of Hormuz will not be reopened until Iran's demands are met. US Secretary of state Marco Rubio said to reporters on Wednesday that a deal would require hard work and patience over time. He added that President Donald Trump had other options, including military ones. Traders evaluated the possibility of curbing?diesel imports. The price of ultra-low sulfur diesel futures fell by about 5% at midday after Politico reported that the Trump administration was planning a 90-day ban on diesel. However, the White House has denied this. US Energy Secretary Chris Wright said on Wednesday that an export ban for diesel would not work, even though Trump had stated he supported it. Analysts and market observers?have warned against such a move, as it would not do much to reduce high energy prices. It could also worsen global supply and disrupt economies. US distillate'stockpiles, including diesel and heating oils, fell by 428,000 barrels at 107.4 millions barrels in the last week according to Energy Information Administration data. US crude inventories increased by 3 million barrels, to 426.4 million last week. Analysts polled had predicted a draw of 641,000 barrels.
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MORNING BID - Diplomacy takes a backseat
Rocky Swift gives us a look at what the future holds for European and global markets. The diplomatic efforts to settle simmering conflicts and trade disputes are in a bad state of mind due to the impact of the surging oil prices. They're making a?good show?of it in Washington. US President Donald Trump was joined by a 'brass 'band, cannons and a 100 foot-long red carpet to welcome Chinese President Xi Jinping on his first visit to the United States since three years. Trump and Xi will likely discuss a range of topics, including Taiwan, Iran and concerns over artificial intelligence. The chances of a new Chinese commitment to purchase Boeing planes are dwindling. Treasury Secretary Scott Bessent, however, said that Washington and Beijing have reached an agreement to "extend their truce". The annual UN General Assembly held in New York was not a happy occasion. Volodymyr Zelenskiy, Ukrainian President, warned of a harsh winter ahead as Russia continues its attacks on Kyiv. Iran and the US remain far apart in their peace plan, while tech leaders have raised alarms about AI risks. Meanwhile, Australia has announced that an OpenAI agent breached a federal government website. The woes of the US Treasury market were manifested by Japan. After returning from a three day trading break, its benchmark government bond rate surged to a 30 year high. The price of rubber futures in Japan has reached a record high. Asia's shares were largely lower, with the exception of Japan's Nikkei index, which was boosted by a weaker Japanese yen. Globally, central bankers have kept a hawkish stance as the rise in oil prices has fueled inflation. Federal Reserve Governor Michael Barr said on Wednesday that more interest rate increases may be necessary. The markets anticipate speeches by other Fed officials, including New York Fed president John Williams and Cleveland Fed president Beth Hammack, on Thursday. The US Labor Department will likely report that initial claims for unemployment rose to 201,000 during the week ending September 19. Meanwhile, continuing claims are likely to have increased by 15,000 in the past week to reach 1.745 millions. The US Labor Department is expected to report that initial jobless claims likely rose to 201,000 in the week ended September 19, while continuing claims likely increased?by 15,000 to 1.745 million in the previous week. Euro Stoxx 50 futures for the entire region fell 0.43%, to 6,298, DAX futures in Germany were down 0.43%, at?25501, while FTSE futures dipped 0.3%, to?10744.5. The S&P 500 E-minis futures in the US were down by 0.19% to 7,757.8. The following are key developments that may influence the markets on Thursday. France's business climate and consumer confidence data, September Germany Ifo data September United Kingdom GfK/NIM Consumer Confidence Data for September
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Copper prices fall as demand fears and interest rates weigh on expectations
Copper fell on Thursday, after hotter than expected U.S. data released the day before sparked fears that interest rates would rise for longer and reduce demand. Benchmark 'three-month copper' on the London Metal Exchange fell 0.22% to $14,586.5 per metric tonne at 0317 GMT. The Shanghai Futures Exchange's most traded copper contract fell 0.52%, to 110,750 Yuan ($16.494.89) per ton. Analysts at Chinese broker Galaxy Futures stated that economic data showed US business activity increased to a five-year high level in September. This put pressure on copper prices. According to CME's Fedwatch, rate traders now price in a 72% probability that the US Federal Reserve will raise interest rates at its October meeting. This is up from just 49% one week ago. Oil prices fell elsewhere after Iran declared it was "open to diplomacy". This provided some reassurance following a statement made by an Iranian official Wednesday that Iran and the U.S. are still far apart on peace talks. The war has increased energy prices, causing inflation and the threat of interest rates that will remain higher for longer. This can dampen demand by stifling growth. The red metal was lifted this week due to strong Chinese buying in advance of the national holidays. However, dollar gains and profit-taking drove it down from its near-record levels. The Yangshan premium copper The price of copper, a measure of China's appetite to import it, was unchanged on Wednesday. It stood at $117 per ton. This is 62.5% more than the beginning of the month. Aluminium fell 0.45% on the LME, while zinc dropped 0.24% and lead declined 0.18%. Nickel also dipped by 0.16%. Tin was barely changed. It only rose 0.04%. Lead fell 0.82% and nickel 0.79%. Tin dipped by 0.25%.
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US and Indian top diplomats talk about Russia sanctions bill signed Trump
US Secretary of State Marco Rubio, and Indian Foreign minister?S. Jaishankar and New Delhi discussed US measures against countries that do business with Russia or Iran on Wednesday. Trump signed a bill last week called the "Lindsey O. Graham Act of 2026 Sanctioning Russia & Iran", named after South?Carolina Republican US senator Lindsey Graham, who died in 2016. The US Congress passed a bill that increased the economic pressure on Russia for its invasion of Ukraine, which began in early 2022. Rubio and Jaishankar discussed sanctions that could be imposed against states that do business with Russia and Iran, the State Department stated in a press release following their meeting in New York. Jaishankar wrote 'on X he reiterated India’s interests and concerns in regard to SRIA. India warned Washington that new tariffs on Russian oil purchases could have a negative impact on bilateral relations. The bill mandates that Trump impose tariffs up to 100 percent within 30 days for all goods imported to the US by the top five importers of Russian crude or gas, as well as from any country who knowingly purchased new oil or natural gas 30 days after?the law was enacted? or helped Russia evade sanctions. India is one of the largest buyers of Russian crude oil. India 'increased its purchases of Russian discounted crude after Russia invaded Ukraine. Trump's hefty tariffs on Indian goods, which could reach as high as 50% in August 2025 due to the increased purchases of discounted Russian crude were partly a result of the increased purchases. Trump lifted these duties in February, citing India's pledge to stop Russian oil purchases. New Delhi only reduced its purchases of Russian oil briefly in early 2026. Since then, they have risen dramatically, particularly since the supply shock following the 'US-Israeli War on Iran. India's?large population? and?growing economy? need affordable energy? supplies. Indian analysts claim that India's purchases from Russia of oil did not finance the war in Ukraine, but helped stabilize global supplies while keeping domestic prices under control.
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Elmet signs tungsten supply agreement with Masan High-Tech, Vietnam
Vietnamese tungsten manufacturer Masan High-Tech Materials announced on Thursday that it would sell a 4,99% stake to US-based tungsten product supplier Elmet Group. The deal valued the company at approximately $2.5 billion. Masan 'High-Tech has also agreed to "supply" and process approximately 1,250 metric tonnes of tungsten equivalent per year for Elmet, under a contract lasting at least eight years. At current prices, the agreement is expected generate gross revenues of about $1.5 billion. After the announcement, shares of Masan High-Tech rose by 7% in the morning on Thursday. Many countries classify tungsten, an extremely tough metal, as a critical material. It is used in electronic and defence applications, including semiconductors and ammunition. Masan High-Tech is the owner of Nui Phao, which is one of the largest tungsten mines in the world outside of China. It accounts for almost all of Vietnam's annual estimated tungsten production of 3,400 tonnes. According to the U.S. Geological Survey, Vietnam will be the second largest tungsten producer in the world after?China by 2024. In June, the company announced plans to expand the Nui Phao mine and nearby Nui Chiem area, potentially adding 115 million tons of tungsten-polymetallic resources as it seeks to expand its role in the global critical-minerals supply chain. Masan High-Tech stated that the transaction was a 'first step in its strategy of building long-term partnership with customers who seek secure tungsten supply, and it would continue exploring'similar partnerships in key market. The sale of Elmet's stake, which is still subject to regulatory and corporate approvals (and may take longer), should be completed by the end of the first month of October. After the transaction, Masan High-Tech’s parent, the conglomerate Masan Group will remain the controlling share-holder with approximately 87.46% ownership. Elmet manufactures tungsten, precision components, and high-energy systems in Maine, Michigan, and Ohio. It won a contract from the US Defense Logistics Agency worth up to $2 billion last week. The contract is meant to rebuild the National Defense Stockpile as well as boost US tungsten supplies. Jefferies Singapore was the exclusive financial advisor to Masan High-Tech.
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Oil drops from highs, bonds are shaky amid trade and peace talks
Investors weighed the'simmering Middle East tensions' and prospects of a 'talk between China and the United States. Tokyo's markets opened?after?a three-day break, and the 10-year Japanese government bonds yield shot up to a 30 year high following a sharp sell-off overnight in the U.S. The greenback and oil prices both eased off recent highs after the leader of Iran vowed that they would never give up following Donald Trump's warning to "annihilate Iran". Investors waited for future rate hike signals from central bank speeches, economic releases and U.S. unemployment claims. The market was also focused on a summit between Trump and Chinese president Xi Jinping, hoping for progress in trade relations. Ray Attrill said in a podcast that "equities are showing signs of creaking" under the weight of ever-rising bonds yields. Attrill is the head of FX Strategy at the National Australia Bank. In a risk-off climate, the U.S. Dollar still appears to be a safe haven. The MSCI Asia ex Japan index fell by 0.64% while Japan's Nikkei rose by 1.73%. The benchmark S&P/ASX 200 index fell 1.2%, a drop of more than three months. Xi’s first visit to the U.S. after nearly three years is not expected to bring major breakthroughs. However, Washington?and Beijing may extend their 11-month trading truce. ?Scott Bessent, Treasury Secretary, said that they had agreed on a new extension while Trump personally welcomed Xi at Joint Base Andrews. The bond yields are at multi-year highs, as traders factor in the possibility of central banks raising interest rates to combat persistent inflation. The yield on Japan's 10-year bond rose 8 basis points to 3.06%. This is the highest level since August 1996. The 30-year yield increased 5.5 basis points to 4.12%. The 10-year Treasury yield in the United States remained at 5.11% after overnight reaching its highest level since 2007. Officials at the central bank maintained a "hawkish" tone, as rising oil costs exacerbated inflationary pressures. Federal Reserve Governor Michael Barr stated on Wednesday that the recent rate increase was part of an effort to recalibrate lending costs. He also indicated that more increases could be required. The markets are looking forward to speeches from other Fed officials, such as New York Fed president John Williams and Fed president Beth Hammack on Thursday. The geopolitical tensions pushed up energy prices. Iranian officials spoke with U.S. ambassadors at the UN General Assembly but neither side made any progress in ending the conflict. Trump reaffirmed his threats of escalation while Iran's President vowed to not yield. Brent crude dropped 1% to $102,05 per barrel. U.S. West Texas Intermediate fell 0.74%, down to $91,48. Gold spot rose 0.35%, to $4.301.89 per ounce. The dollar index dropped 0.04%, to 101.09 while the euro fell 0.02%, to $1.14. The Japanese yen rose 0.24%, to 157.91 dollars. The U.S. Labor Department will likely report that initial claims for unemployment rose to a likely 201,000 in the week ending September 19. Meanwhile, continuing claims are likely to have increased by 15,000 to 1.745 millions the previous week. The U.S. Labor Department is expected to report that initial jobless claims likely rose to 201,000?in the week ended September 19, while continuing claims likely increased 15,000?to 1.745 million in the prior week. European futures are lower. Euro Stoxx futures declined 0.33% at 6,304.00. DAX futures slipped 0.33% at 25,525.00. FTSE Futures fell 0.35% at 10,739.50. Ether rose 0.46% to 2,683.24, while Bitcoin grew 0.07% to $84 288.53.
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Iran declares it is willing to negotiate to end the conflict, lowering oil prices
Oil prices fell on Thursday after rising 4% the previous day.?Iran stated that it was open to diplomacy in order to end the US/Iran conflict, but the two countries are still far apart as to how to achieve this. Brent crude futures dropped 94 cents or 0.9% to $102,13 per barrel. West Texas Intermediate futures declined 59 cents or 0.7% to $91,56. Iran and the United States are divided over how to end their war. Diplomacy, however, must continue. A senior Iranian official said. Iran's President told the UN General Assembly on Wednesday that Tehran will never yield to US pressure. The official stated that Tehran was reviewing Washington's response regarding its peace proposals. These include lifting the US naval blockade of Iranian ports and reopening of the Strait of Hormuz. The official stated that during indirect talks on Tuesday the reopening of Strait of Hormuz, and the lifting of Washington’s naval blockade against Iran were discussed. Mohsenrezaei, Iran's chief of security, said earlier on Wednesday that the Strait of Hormuz will not reopen until Iran's demands are met. US Secretary of state Marco Rubio said to reporters on Wednesday, that a deal would require hard work and patience over time. He added that Trump had other options. The traders also evaluated the possibility of limiting diesel exports. The price of ultra-low sulfur diesel futures fell by about 5% at midday after Politico reported that the Trump administration had plans to impose a 90-day ban on diesel. However, the White House has denied this. Bloomberg, citing sources, reported that Chris Wright, Energy Secretary, had told the oil industry to prepare for possible US restrictions on diesel exports during a call late Tuesday. Wright had said on Wednesday morning that a ban on diesel exports would not work, despite the fact that US President Donald Trump has said he will support it. Market watchers and analysts have warned such a move would do little to reduce high energy prices, and could worsen the global supply and further disrupt economies. The Energy Information Administration reported that US crude oil inventories increased by 3 million barrels, to 426.4 millions barrels, last week. The analysts polled had predicted a draw of 641,000 barrels. Fuel stocks fell.
Look at the performance of India’s biggest IPOs as they list on NSE
National Stock Exchange of India (NSEI) shares rose?as high as 5% in their trading debut Thursday?after a $2.3billion IPO?the country's 2nd-largest.
The stock was listed on the BSE at 1,800 Indian Rupees ($18.77), a % premium to its IPO price.
Check out the performance of large companies that have a market capitalization of over $1 billion.
HYUNDAI MOTOR INDIANA
Hyundai Motor India shares dropped more than 7% in their debut 2024 after the largest-ever IPO in India drew a muted response from investors.
The sentiment was weighed down by concerns over an industry slowdown and a high valuation. Its South Korean parent raised $2.91 billion by selling a 17.5% stake as part of a pure "offer-for-sale" where existing investors sold their stakes.
At the last close, Hyundai India?has gained approximately 7% on its IPO price.
LIFE INSURANCE COMPANY OF INDIA
Life Insurance Corp of India (India's largest insurance company) fell nearly?8% on its debut in 2022, despite the strong demand for then India's 'largest IPO'.
The government raised?205 billion by selling a 3.5 percent stake in the insurer owned by the state, which is well below its original target of upto $12 billion.
LIC traded at a price of 407.5 rupees. This is a level that has been adjusted following issuance of a 1:1 bonus in May.
Paytm, a digital payments company in India, suffered one of the worst large-cap debuts on India's stock market in 2021. Its $2.5?billion IPO saw its share price plummet by more than 27%.
The concern over high valuations has intensified, especially among technology companies that are losing money.
Paytm has dropped 17.5% in value since its launch.
TATA CAPITAL
Tata Capital's debut in October 2025 saw a modest gain of 1.4%, due to the crowded issuance schedule and limited valuation discount compared to listed peers.
The $1.75 billion IPO of LG Electronics India coincided with its $1.3 billion $1.3 billion offering which attracted bids worth nearly $50 billion.
Tata Capital has risen 7.4% since its listing.
COAL INDIA
Coal India (the world's largest coal mining company) surged by 40% on the day of its listing in November 2010. Investors snapped up this stock as a proxy for India's surging energy demand and growth.
The biggest IPO of the government at the time set the stage to the public listing other state-owned enterprises.
Coal India's market debut has seen a gain of 73.3%.
(source: Reuters)