Investment Daily: Global stocks and bonds fell amid renewed geopolitical concerns

9 July 2026

US stocks mostly fell on Wednesday amid higher oil prices, despite a rebound in chipmaker shares. The S&P 500 edged 0.3% lower, while the Nasdaq closed 0.2% higher.  

US Treasuries declined as higher oil prices revived inflation concerns. 10-year yields rose 3bp to 4.58%.

European stocks fell on Wednesday as geopolitical tensions re-escalated in the Middle East. The Euro Stoxx 50 fell 1.8%, while both the German DAX and the French CAC 40 dropped 2.2%. In the UK, the FTSE 100 lost 1.7%.

European government bonds sold off. 10-year German bund yields climbed 13bp to 3.12% and 10-year French bond yields jumped 14bp to 3.93%. In the UK, 10-year gilt yields closed 12bp higher at 4.97%.

Asian stock markets traded mixed but mostly lower on Wednesday, as investors continued to monitor volatile chipmaker stocks and geopolitical developments in the Middle East. Korea’s Kospi dropped 5.3% while Japan’s Nikkei 225 lost 2.1%. Elsewhere, China’s Shanghai Composite fell 0.5% while India’s Sensex closed 2.1% lower as a rebound in oil prices weighed on market sentiment. Bucking the regional trend, Hong Kong’s Hang Seng rallied 3.0%, led by gains in tech share on some positive corporate news and as investors rotated into laggards with cheaper valuations.

Crude oil prices extended gains on Wednesday amid renewed geopolitical worries. WTI for August delivery settled 4.4% higher at USD73.5 a barrel. 

The Bank of Japan (BoJ) raised its policy rate by 25bp to 1.00%, as widely expected, and decided to halt the reduction in JGB purchases from April 2027. The BoJ highlighted the risk of underlying CPI inflation deviating upward above 2%.

The Reserve Bank of Australia (RBA) kept its policy rate unchanged at 4.35%, as widely anticipated. Governor Bullock noted upside risks to inflation and did not rule out further tightening.

In China, May activity indicators continued to reflect a two-speed economy. Industrial production showed resilience, up 4.5% YOY, driven mainly by gains in high-tech manufacturing and new energy sectors thanks to robust exports. However, non-tech domestic demand was softer than expected as the property sector remained under pressure. Retail sales fell 0.6% YOY, partly reflecting an unfavourable base effect from last year’s trade-in subsidies. Fixed asset investment contracted by 4.1% YOY in the first five months, despite strong advanced manufacturing investment.

In China, soft food prices have constrained headline CPI inflation, as subdued core inflation reflects tepid domestic demand.