Investment Daily: US stocks edged lower as Treasury yields rose
21 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 were mixed.
Markets
US stocks fell on Monday amid lingering geopolitical concerns and higher bond yields, while investors awaited key earnings releases. The S&P 500 closed 0.2% lower.
US Treasuries fell as higher oil prices revived inflation concerns. 10-year yields rose 4bp to 4.59%.
European stocks lacked clear direction on Monday amid ongoing Middle East tensions. The Euro Stoxx 50 was down 0.1%. The German DAX edged up 0.1% and the French CAC closed flat. In the UK, the FTSE 100 fell 0.7%.
European government bonds fell. 10-year German bund yields rose 3bp to 3.15% and 10-year French bond yields edged up 2bp to 3.95%. In the UK, 10-year gilt yields rose 8bp to 5.03% amid fiscal concerns.
Asian stock markets traded mixed on Monday, amid persistent geopolitical uncertainty and AI/semiconductor sector volatility. Korea’s Kospi dropped 4.5% after returning from a three-day weekend. India’s Sensex also fell 0.6%. Elsewhere, tech sector gains and state support aided strength in Chinese equities, with Hong Kong’s Hang Seng and China’s Shanghai Composite up 2.4% and 0.9% respectively. ASEAN markets were mixed. Japan’s market was closed for a public holiday.
Crude oil prices rose on Monday. WTI for August delivery settled 0.9% higher at USD83.2 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 (21 July 2026)
No major releases.
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