Trading Day-AI-pocalypse now

ORLANDO, Florida, Sept. 14 (Reuters) - The 10-year U.S. Treasury yield rose above 5% on Monday for the first time in nearly three years, as yet another rise in energy prices from supply disruptions in the Middle East fueled worries over inflation. Meanwhile, AI stocks dragged Wall Street into the red, as fears over the [destructive force](https://x.com/hilbertspaess/status/2097476196791709843?s=20) of artificial intelligence spooked investors. Today's key market moves: * **Stocks:** South Korea -3.3%, Japan -0.8%. Europe -0.5%, UK +0.4%. Big three U.S. indices fall — Dow -0.3%, S&P 500 -0.5%, Nasdaq -0.6%. * **Sectors/shares:** Eight sectors on the S&P 500 fall, three rise. Tech -1.7%, comms services +2.7%. Chipmakers -6%, Nvidia -3.4%, Intel -5.6%. CrowdStrike Holdings +14%, Palo Alto Networks +13%. * **FX:** Dollar index hits one-month high, posts biggest rise since Jackson Hole. Chilean peso -2%, Mexican and Colombian pesos -1%. * **Bonds:** 10-year U.S. yield above 5%, 10-year TIPS yield highest since 2008. UK 30-year highest since 1998, German 10-year yield highest since 2009. * **Commodities/metals:** Oil +1%, trimming earlier gains of up to 5%. U.S. diesel up to record $6.23/gallon. European nat gas +4% above €84/MWh. Gold lowest in over a month. 5 Alive The global "bondpocalypse" marked another milestone on Monday, as the 10-year U.S. Treasury yield rose above 5.00% for the first time since October 2023. It came within a basis point of breaking above 5.02%, which would have been its highest since 2002. The bond selloff is global — yields in Japan and Europe, across the maturity curve, are also at or near the highest in years. Sometimes decades. But as investors grapple with hot inflation and rising central bank rate hike expectations, there's a growing realisation that more expensive money will choke borrowing, spending, investment and economic activity. At some point, and to some degree. The latest wave of AI doomerism is another factor that could lure investors back into bonds. All eyes now turn to the Fed's decision, revised projections, and Chair Kevin Warsh's press conference on Wednesday. In my column today, I argue that the most important signal from the bond market selloff isn't yields surging to multi-year highs, important as that is, but the flattening of the yield curve. This suggests the economy, particularly consumers, will struggle to cope with higher borrowing costs. Today's Talking Points: It's the end of the world as we know it? Remember when the big fear around AI was that it would destroy everyone's jobs? Good times. Now, all of a sudden, the worry is it will destroy humanity itself. Some of the most powerful leaders in the industry, including Anthropic CEO Dario Amodei, OpenAI CEO Sam Altman, and SpaceX CEO Elon Musk, are now calling for the pace of advanced AI development to be slowed. How that happens is unclear. Broader, tighter, government-led regulation and controls? That's not something these three figures, and the tech industry at large, are known to support. And President Donald Trump on Monday downplayed the fears, and said the U.S. has sufficient guardrails in place. But why has this latest — and most chilling — wave of AI "doomerism" come now? There is no shortage of theories doing the rounds, some more conspiratorial than others. For markets, the immediate fallout seems to be "risk off" — stocks down, bonds up. China 'data dump' Beijing releases its top-tier economic indicators for August on Tuesday, with industrial production, retail sales, business investment, and house prices front and center for investors. The monthly "data dump" will offer clues on the strength — or otherwise — of the economy, and specifically whether growth continues to be driven by exports, or whether domestic demand is finally doing more of the heavy lifting. Lending figures released on Sunday fell short of expectations. It is the last batch of official data before President Xi Jinping travels to Washington next week for a summit with Trump. Chinese growth has been softer than Beijing would like — the deflationary fallout from the property sector burst continues to hang over the economy — and on Sunday Xi unveiled initiatives in areas ranging from AI to trade to deepen cooperation among the "Greater BRICS" emerging economies. What could move markets tomorrow? * China "data dump" — industrial production, investment, house prices, retail sales (August) * Germany ZEW index (September) * Germany PPI inflation (August) * UK unemployment (August) * U.S. Treasury sells $13 billion of 20-year notes at auction

Trading Day-AI-pocalypse now

Market moves and the AI selloff

The bondpocalypse and Fed focus

Bond market signals and AI doomerism

China data and other market catalysts

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