Blue Monday
SPY•Global bond selling accelerated on Monday, pushing French, German, UK and US 10-year yields to their highest levels since the mid-to-late 2000s. Oil rose 1% as stocks fell, while news of separate US-Iran talks with mediators eased selling pressure.
1. Bonds and stocks fall
The global bond slump accelerated as oil prices rallied after US President Donald Trump rejected an Iran peace proposal. Stock markets fell, though news that the two sides would hold separate talks with mediators eased selling pressure across asset classes. The Dow dropped 0.7%, the S&P 500 fell 0.8% and the Nasdaq lost 0.9%.
2. Debt market strains
High-yield spreads widened on Friday to their highest since April and approached 300 basis points. Investment-grade spreads ended last week at 81 basis points and likely reached their widest since April on Monday. Oracle's borrowing costs and credit default swap rates rose sharply, while Meta's bond yields and CDS also moved higher. Hyperscalers issued around $220 billion in bonds this year, a figure that could double next year.
3. Nvidia raises buyback
Nvidia increased its share buyback authorization by a record $150 billion, bringing remaining capacity to $235 billion, which it expects to deploy through fiscal 2028. Its shares rose nearly 2% on Monday. Gold fell 3.5% to a seven-week low, while Brent crude rose 1%.
