Yields fall after US 10-year hits highest since 2002; stocks, euro also decline

Bond yields dipped on Thursday following the benchmark 10-year Treasury yield hitting its highest level since 2002, while stocks and the euro also declined. Initially, yields rose after September manufacturing data showed little change in US manufacturing activity, with input prices surging due to strong demand. Investors are eagerly awaiting the upcoming US monthly jobs report for further economic clues.

Globally, yields have been rising due to high energy costs driving inflation and expectations of growth in AI and data center building. Oliver Pursche, a senior advisor, stated that the global bond selloff might be overdone. The US 10-year note yield fell to 5.272 percent from 5.293 percent, having previously reached 5.34 percent, its highest since April 2002.

The 2-year yield also decreased to 4.814 percent from 4.887 percent. The euro hit its lowest level in 17 months, falling below $1.13 for the first time since May 2025 against the dollar, as investors sold European assets. MSCI's global stock index fell 0.39 percent, while the pan-European STOXX 600 index declined 1.3 percent. Dow Jones, S&P 500, and Nasdaq Composite indices also experienced slight drops.

Oil prices climbed, with US crude reaching $91.79 a barrel and Brent at $100.78 a barrel. Stalled peace talks between the US and Iran have contributed to elevated crude prices.