Geopolitical developments in the Middle East, rising oil prices and movements in Treasury yields shaped global markets, while investors focused on growth and core personal consumption expenditures data due in the United States.
The US 10-year Treasury yield stabilized at 5.24% after reaching 5.30% the previous day, its highest level since 2007. The 30-year Treasury yield fell to 5.56% after rising to 5.62%, its highest level since 2002. The two-year Treasury yield moved sideways at around 4.90% after reaching 4.97%, its highest level since May 2024.
Rising oil prices heightened inflation concerns and strengthened expectations that central banks, led by the US Federal Reserve (Fed), could adopt a tighter monetary policy stance. Concerns over persistent inflation, public spending and companies’ growing borrowing to finance artificial intelligence investments also fueled demand for higher returns in the bond market.
Expectations that investments in artificial intelligence would accelerate the economy also contributed to the rise in the US 10-year Treasury yield. Money markets priced in a series of Fed rate hikes throughout next year, while economic data due in the United States is expected to influence those expectations.
The November-dated Brent crude contract traded at 103.1 dollars per barrel, up 0.5%, after US President Donald Trump rejected reports that he was preparing to take steps toward easing sanctions on Iran. Mohsen Rezaei, secretary of Iran’s Supreme National Security Council, made comments on negotiations and war while targeting Trump.
Trump also hosted Meta Chief Executive Officer Mark Zuckerberg, Alphabet Chief Executive Officer Sundar Pichai, Microsoft Chief Executive Officer Satya Nadella, Nvidia Chief Executive Officer Jensen Huang, Tesla and SpaceX Chief Executive Officer Elon Musk, Advanced Micro Devices Chief Executive Officer Lisa Su, Anthropic Chief Executive Officer Dario Amodei and OpenAI President Greg Brockman at an artificial intelligence meeting at the White House. Trump said after the meeting that the talks had been good and productive.
Fed Governor Michael Barr said risks to achieving the inflation target had increased, while risks related to the labor market had declined. Barr said additional policy adjustments might be needed to ensure that inflation falls to the target within a reasonable period.
New York Fed President John Williams said there was no emergency following this month’s policy move. Chicago Fed President Austan Goolsbee described inflation remaining above the 2% target for five and a half years as “playing with fire.”
Mixed outlook for US and European stocks
Following comments from Fed officials, the dollar index stood at 101.5, while gold was down 0.1% at 4,180 dollars per ounce. The US consumer confidence index fell to 81.9 in September, and JOLTS job openings declined to 7.079 million in August, both below expectations.
Against this backdrop, the Dow Jones index fell 0.26%, the S&P 500 declined 0.17% and the Nasdaq lost 0.09%. US stock index futures started the new day higher.
Geopolitical tensions, energy prices and expectations regarding possible Fed rate moves affected European stock markets. In the eurozone, the economic confidence index fell 0.5 points to 97.9 in September, while the consumer confidence index declined from minus 15.5 to minus 16.5.
Germany’s public debt rose to 2.7535 trillion euros in the second quarter of the year, driven by spending from special funds for infrastructure, climate investments and the defense industry. Dan Jorgensen, the European Commission member responsible for energy, said the European Union had paid more than 100 billion euros in additional costs this year for the same amount of oil and natural gas.
Expectations of new tax increases in France’s budget, along with the debt problem and political deadlock ahead of next year’s presidential election, increased pressure on the country’s stock market. The euro-dollar exchange rate also fell to 1.1312, its lowest level since May 2025, amid energy prices and expectations that the Fed could pursue a tighter policy.
Germany’s DAX 40 rose 0.1% and Italy’s FTSE MIB gained 0.09%, while France’s CAC 40 fell 0.53% and the UK’s FTSE 100 declined 0.45%. European stock index futures opened mixed.
China support watched in Asian markets
Caution among investors ahead of US data led to mixed trading in Asian stock markets. The Chinese government announced that it would introduce new support policies to limit the economic slowdown and stabilize the property market.
The People’s Bank of China cut the one-year lending rate of three policy banks by 25 basis points to support the real economy. The rise in the manufacturing Purchasing Managers’ Index from 49.8 to 50.1 in September indicated that the sector had returned to growth.
Weak domestic demand and a prolonged downturn in the property market are weighing on household and business confidence in China, while geopolitical uncertainty and rising trade tensions pose risks to the export outlook. In Japan, retail sales fell 1.2% month-on-month in August, while industrial production declined 1.7%.
Near the close, the Nikkei 225 was up 2.1% and the Shanghai Composite rose 0.1%. South Korea’s Kospi fell 0.2%, while Hong Kong’s Hang Seng moved sideways.
Borsa Istanbul loss reaches 2.40%
The BIST 100 index on Borsa Istanbul ended the day down 2.40% at 12,290.58 points. The October-dated futures contract based on the BIST 30 index also fell 0.19% in the evening session compared with the regular-session close.
The dollar/Turkish lira exchange rate ended the previous day flat at 48.9894. At the opening of interbank trading, the rate stood at 49.0130, up 0.1% from the previous close.
An Economic Coordination Meeting was held under the chairmanship of President Recep Tayyip Erdoğan, with the participation of economic officials and senior executives from relevant institutions. Developments in the capital markets were assessed at the meeting.
Erdoğan announced that a fully authorized board had been established under the chairmanship of the Vice President to coordinate the process concerning funds slated for liquidation. The Fund Coordination Board is expected to provide overall coordination to ensure that the liquidation process is carried out with due regard for investors’ legitimate rights and the public interest.
The State Supervisory Council launched an investigation and inspection process into investment fund transactions in the capital markets. The Capital Markets Board presented a roadmap for making payments to investors in funds subject to liquidation whose entitlement reconciliation has been completed based on their assets and liquidity.
During the day, markets will monitor the unemployment rate, foreign trade balance, services producer price index, and monetary and banking statistics in Türkiye; unemployment and inflation in Germany; and ADP private-sector employment, personal income, personal spending, core personal consumption expenditures and second-quarter growth data in the United States.
Analysts assess 12,200 and 12,100 points as support levels and 12,400 and 12,500 points as resistance levels for the BIST 100 index.
