Key facts
- Asian stocks rose, led by technology shares, with futures indicating gains in US and European markets.
- Oil prices eased due to potential supply increases, with Brent crude at $103.68 and US crude at $100.02.
- US 2-year Treasury yields reached their highest since mid-2024 at 4.7604%.
- There is a 56% chance of another Fed rate hike in October, according to futures pricing.
- Saudi Arabia is reportedly aiming to restart flows through its damaged east-to-west pipeline.
- US President Donald Trump will host Chinese President Xi Jinping in Washington this week.
Asian stock markets edged higher, with technology shares leading the gains, while oil prices eased amid expectations of increased supply. Investors are closely monitoring the Federal Reserve's interest rate trajectory and the ongoing debate surrounding artificial intelligence.
Futures indicated a positive open for US and European markets. S&P 500 futures were up 0.3%, and Nasdaq futures added 0.4%. In Europe, EUROSTOXX 50 futures rose 0.2%.
US 2-year Treasury yields have tested the psychologically important 5% threshold, reaching 4.7604%, their highest since mid-2024. The Federal Reserve's recent hawkish guidance has led to futures pricing a 56% chance of another rate hike in October.
Oil prices remained above $100 a barrel, with Brent crude at $103.68 and US crude at $100.02. Saudi Arabia is reportedly aiming to quickly restart flows through its damaged east-to-west pipeline.
This week's headline event is Chinese President Xi Jinping's three-day state visit to Washington to meet US President Donald Trump. The meeting occurs against a backdrop of multiplying global crises, including the deepening fractures of a fragmenting world order and ongoing conflicts in Ukraine and the Middle East.
Other key events include flash purchasing managers index (PMI) data for the US manufacturing sector on Wednesday, and Indonesia's central bank interest rate decision. The 81st UN General Assembly High-Level Week also kicks off, focusing on restoring trust and managing transformation, with urgent panels on artificial intelligence governance, global climate change, and sovereign debt mechanisms.
Discussions around AI development continue, with calls from some AI lab heads to 'pace' its development amid concerns about its potential threats. President Trump has signaled he will not let developers apply the brakes, while European Commission President Ursula von der Leyen wants to discuss the risks with major AI players in Europe.