Global Markets React to U.S. Labor Data

The benchmark 10-year Treasury yield climbed to 4% after U.S. labor market data eased recession fears, influencing global markets and supporting the U.S. dollar. As markets adjusted to a reduced likelihood of a Federal Reserve rate cut, focus shifted to upcoming U.S. CPI data and geopolitical events affecting economic sentiment.

The benchmark 10-year Treasury yield, a barometer for global finance, surged to 4% on Monday. This rise comes on the heels of stronger-than-expected U.S. labor market data that has allayed recession fears and tempered expectations for an imminent rate cut by the Federal Reserve.

Following the unexpected payroll growth, market participants have dialed down bets on a significant rate cut at the Fed's November meeting. Consequently, government bond yields rose, reflecting changing investor sentiment. The two-year yield notably climbed above the 10-year for the first time in weeks, signaling caution over future economic conditions.

Globally, financial markets are monitoring U.S. CPI data due later this week and geopolitical developments like the Israeli conflict. Meanwhile, the robust dollar strengthened further, particularly against the yen, amid market adjustments. With geopolitical tensions simmering and economic outlooks evolving, investor focus remains on central banks' next moves.

(With inputs from agencies.)