From Marc Chandler at Bannockburn Global Forex:
Overview: The biggest development today in the capital markets is the jump in benchmark interest rates. The US 10-year yield is up five basis points to 2.86%, which is about 10 bp above Monday’s low. European yields are up 9-10 bp. The 10-year German Bund yield was near 0.88% on Monday and is now near 1.07%. Italy’s premium over German is near 2.18%, the most in nearly three weeks. Although Asia Pacific equities rallied, led by Japan’s 1.2% gain, but did not include South Korea, European equities are lower as are US futures. The Stoxx 600 is struggled to extend a five-day rally. The Antipodeans are the weakest of the majors, but most of the major currencies are softer. The euro and sterling are straddling unchanged levels near midday in Europe.
Gold is soft in yesterday’s range, near its lowest level since August 5. While $1750 offers support, ahead of it there may be bids around $1765. October WTI is pinned near its lows around $85.50-$86.00. The drop in Chinese demand is a major weight, while the market is closely monitoring developments with the Iranian negotiations. US natgas is edging higher after yesterday 6.9% surge to approach last month’s peak. Europe’s benchmark is 4.5% stronger today after yesterday’s 2.7% pullback. Iron ore fell (3.9%) for the fourth consecutive decline. The September contract that trades in Singapore is at its lowest level since July 22. September copper is a little heavier but is still inside Monday’s range. September wheat is extending its pullback for the fourth consecutive session. It had risen in the first four sessions last week. It is moving sideway in the trough carved over the past month....
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