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Investment Daily: Global bonds rose amid a broader flight to safety

16 October 2026

Key takeaways

  • US stocks ended higher; Treasuries rose.
  • European stocks were mixed; government bonds rose.
  • Asian stocks declined.

Markets

US stocks ended higher on Thursday, recovering from intraday losses, as investors rotated away from AI-related sectors amid concerns over AI valuations and the sustainability of AI investment. The S&P 500 was up 0.3%.

US Treasuries rallied as heightened AI concerns drove demand for safe assets. 10-year yields fell 13bp to 5.06%.

European stocks traded mixed but mostly higher on Thursday. The Euro Stoxx 50 closed 0.4% lower. The German DAX rose 0.3%, while the French CAC was up 0.8%. In the UK, the FTSE 100 gained 1.1%.

European government bonds rose. 10-year German bund yields fell 6bp to 3.41%, and 10-year French bond yields fell 9bp to 4.79%. In the UK, 10-year gilt yields fell 5bp to 5.37%.

Asian stock markets declined on Thursday, amid an extended sell-off in regional semiconductor/tech shares. Korea’s Kospi dropped 7.6%, while Japan’s Nikkei 225 slid 4.9%. Elsewhere, China’s Shanghai Composite and Hong Kong’s Hang Seng fell 1.6% and 1.0%, respectively. Bucking the regional trend, India’s Sensex rallied 2.1%, driven by strength in software stocks.

Crude oil prices were set for a second weekly advance. WTI for November delivery settled 3.0% higher at USD98.0 a barrel.

Key Data Releases and Events

Releases yesterday

In the US, PPI inflation accelerated to 1.3% mom in September from 0.5% mom in August, above market consensus. Retail sales rose 0.8% mom in September after a 1.3% mom gain in August, beating expectations. 

Releases due today (16 October 2026)

US industrial production likely rose 0.4% mom in September after no change in August.

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