Morning Note: A Round-up of Global Financial Market News.
Market News
The yield on the US 10-year Treasury note is currently 4.65% after a weaker-than-expected jobs report scaled back bets on Fed rate hikes. Non-farm payrolls unexpectedly declined by 23k last month, versus expectations for a gain of 80k, while figures for May and June were also revised sharply lower by a combined 103k. The odds of a Fed rate hike in September fell to 44%, from 67% a week earlier. Scott Bessent has signalled he’ll do whatever he can to keep US bond yields from soaring.
Gold surged more than 7% last week and currently trades at $4,350 an ounce. The FT reports that the FCA is preparing a framework for tokenised gold in an attempt to protect the dominance of London in global bullion trading. Tokenised gold involves creating digital tokens that represent ownership rights in physical gold. Gold bars are held by the issuer as a backing for the tokens.
Brent crude trades at $83 a barrel as uncertainty persisted over efforts to reopen the Strait of Hormuz. Iran said over the weekend that talks with Oman on establishing a shipping route through the strategic waterway were nearing an agreement but warned that any arrangement would not lead to an immediate reopening of Hormuz. Tehran also rejected direct negotiations with the US for now, citing breaches of the interim peace deal reached in June, while maintaining demands for an end to the US naval blockade, the lifting of sanctions, and compensation for war damages.
The S&P 500 rose to a record at the end of its best week since April. In Asia this morning, equity markets tracked Wall Street higher: Nikkei 225 (+2.1%); Hang Seng (+0.9%); Shanghai Composite (+0.7%); Kospi (+0.7%). TSMC sales rose by 45% as demand for AI hardware stayed strong.
The FTSE 100 is little changed at 10,896, while Sterling trades at $1.3495 and €1.1680. Hiring at British businesses held steady in July, ending a downturn stretching back to the Liz Truss crisis in 2022, according to REC and KPMG. Temporary vacancies rose for the first time in two years and pay growth ticked up.
Berkshire Hathaway spent about $4.5bn buying back shares in the second quarter and purchased nearly $20bn of equities.
Source: Bloomberg
