Oil retreat and easing yields support global equities

US stock indices moved higher on Friday as moderating oil prices halted the recent surge in Treasury yields. The S&P 500 gained 0.50%, the Dow Jones Industrial Average rose 479 points and the Nasdaq 100 added 0.40%. The US 10-year Treasury yield held around 5.20%, near its highest level since the mid-2000s, as traders refocused on hawkish comments from Federal Reserve officials and higher inflation expectations. Applied Materials rose 2.30%, Lam Research 2.60% and Microsoft 3.70%, while Meta fell 3.30% and Oracle declined 1.70%. Over the week, the S&P 500 gained 0.60%, the Nasdaq 100 rose 2.10% and the Dow fell 103 points.

Oil prices eased to around $92 a barrel after Iran called on the US to return to an interim peace agreement and proposed reopening the Strait of Hormuz and resuming nuclear talks within seven days if the Trump administration accepted its conditions. Oil flows through Hormuz reached 33.7 million barrels this week, roughly in line with the previous week. Markets remained volatile amid mixed signals over peace prospects, recovering Middle East energy flows and speculation over US diesel exports.

European equities ended the week higher as lower energy prices eased inflation concerns and sovereign yields held below their recent highs. The Euro STOXX 50 gained 0.40% to 6 296 and the STOXX Europe 600 rose 0.30% to 638.5. Germany’s DAX 40 advanced 0.50% to 25 396, while France’s CAC 40 was little changed at 8 078. Banks and technology stocks gained, with UniCredit, Deutsche Bank and ING higher, while weaker Chinese demand weighed on luxury stocks. German consumer sentiment deteriorated more sharply than expected heading into October. The FTSE 100 inched higher on Friday as advances in banking and mining stocks offset losses among energy companies.

Asian markets were mixed as investors assessed global yields and developments from the Trump-Xi summit in Washington. The Shanghai Composite fell 1.12% to 3 892.43 and the Hang Seng Index declined 1% to 24 510, while Japan’s Nikkei 225 rose 1.30% to 66 364 as lower oil prices and stabilising bond yields supported equities. The offshore yuan depreciated to around 6.72 per dollar, extending its decline for a fourth session. Artificial intelligence (AI) was a key topic at the Trump-Xi meeting, while the two leaders also discussed Taiwan and the management of competition in the sector. The US-China trade truce was extended by two months, although little progress was made on AI, Iran and Taiwan.

South African markets declined, with the JSE All Share Index falling 0.66% to 110 826.04. Resources declined 0.53%, industrials fell 0.40% and financials lost 0.93%. The rand strengthened against the dollar, pound and euro, trading at around R16.31, R21.61 and R18.59, respectively.

Brent crude fell 2.03% to $104.44 a barrel, while gold rose 0.37% to $4 293.62 an ounce. Silver gained 0.79% to $64.41, while platinum advanced 1.55% to $1 779.10.