Shares slip as European bond bashing rumbles on
SPY•Global shares fell as European bond strains, rising energy prices and reports of large technology-company debt plans weighed on markets. Brent rose nearly 4% to above $104 a barrel, while the 10-year U.S. Treasury yield reached 5.33%, near its 24-year high.
1. Shares retreat globally
The pan-European STOXX 600 fell 1% to its lowest since June, and France’s CAC 40 dropped by a similar amount, leaving it more than 12% below its August record. Japan’s Nikkei fell 1.4% and South Korea’s market lost 2.6%. European bank shares also declined, with the sector index down nearly 2%.
2. Bonds and energy weigh
Brent crude rose nearly 4% to above $104 a barrel, while U.S. crude gained 3.2% to $91.43. The euro traded near a 17-month low as worries about French finances spread to Italian and Greek debt. The 10-year U.S. Treasury yield reached 5.33% in European trading after touching 5.36%, its highest in 24 years.
3. Technology debt plans
Reports said Broadcom was seeking $50 billion in financing, while SpaceX planned to issue $30 billion in investment-grade debt and raise $10 billion in loans to buy chips from Nvidia. SpaceX shares and bonds fell, and credit default insurance on the company reached record highs. Separately, Samsung projected third-quarter operating profit would jump 783% to 107.4 trillion won, though its shares fell 2.4%.
