Investment Daily: US stocks and Treasuries fell amid renewed geopolitical tensions
14 July 2026
Key takeaways
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US stocks and Treasuries fell.
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European stocks were mixed; government bonds fell.
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Asian stocks traded mostly lower.
Markets
US stocks declined on Monday amid renewed geopolitical tensions and a hawkish Fed repricing. The S&P 500 lost 0.8%, led by losses in technology/chipmaker stocks and cyclical sectors, while energy and defensive sectors outperformed.
US Treasuries fell on higher oil prices and hawkish Fed comment. 10-year yields rose 6bp to 4.62%.
European stocks were mixed on Monday as investors continued to assess geopolitical situation in the Middle East. The Euro Stoxx 50 closed flat. The German DAX was up 0.2% and French CAC rose 0.3%. In the UK, the FTSE 100 ended little changed.
European government bonds fell. 10-year German and French bond yields rose 5bp to 3.11% and 3.88% respectively. In the UK, 10-year gilt yields jumped 10bp to 4.97%.
Asian stock markets traded mixed but mostly lower on Monday as oil prices rallied and AI-related stocks led losses. Korea’s Kospi dropped 8.9% and Japan’s Nikkei 225 lost 1.9%. Elsewhere, China’s Shanghai Composite fell 2.1%, while Hong Kong’s Hang Seng edged up 0.2%. India’s Sensex ended little changed (+0.1%).
Crude oil prices surged on Monday amid renewed geopolitical tensions. WTI for August delivery settled 9.4% higher at USD78.1 a barrel.
Key Data Releases and Events
Releases yesterday
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.
Releases due today (14 July 2026)
In the US, headline CPI inflation likely eased on lower oil prices, but core inflation may have remained stable at close to 3.0% yoy. The NFIB Small Business Optimism is expected to be broadly unchanged at below average levels. Hiring intentions have softened in recent months.
In China, strong AI-related demand and new energy products should continue to drive export growth and the trade surplus.
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