SPY•SPY•Global and U.S. stocks reached record highs despite a bond rout, while French borrowing costs surged and diesel prices stayed near record levels. Market-implied odds of a Federal Reserve rate hike at its October meeting fell from 70% to around or below 50%.
The quarter ended with a global bond rout, a 40% jump in Brent crude and record-high diesel prices, yet U.S. and global stocks reached fresh record highs. The article says corporate earnings growth helped drive the gains, which followed the strongest three-month period in six years.
France’s 10-year borrowing cost rose to its highest level since 2002, nearing 5%, after its worst quarterly performance since 1987. The spread between French and German 10-year borrowing costs is close to its widest since the euro zone debt crisis, while the cost of insuring French debt against default reached its highest point since 2013. The article cites a proposed 2027 budget and public protests over planned measures as part of the context.
The Trump administration told Germany and France to draw down emergency diesel inventories to help ease the global fuel squeeze or face a potential U.S. diesel export ban. Separately, market-implied odds of a Federal Reserve rate hike at its October meeting rose to 70% before retreating to around or below 50% after New York Fed President John Williams did not endorse consecutive rate increases. The article also says Anthropic plans to invest more than half a trillion dollars in computing infrastructure over the coming years and is targeting a $2 trillion valuation.
