Global Markets Witness Minor Easing Amid Rising U.S. Treasury Yields

Global stock indexes saw a slight decline on Wednesday as energy shares dropped. Investors kept faith in the Federal Reserve’s ability to manage a soft economic landing. Meanwhile, U.S. Treasury yields rose, China's yuan lost gains after significant stimulus, and oil prices decreased amidst easing supply concerns in Libya.

Global stock indexes mostly eased on Wednesday, weighed down by a slump in energy shares, while U.S. Treasury yields rose as investors maintained confidence in the Federal Reserve's capacity for a soft landing for the U.S. economy.

In China, the yuan retreated despite the central bank's major stimulus unveiling, the largest since the pandemic, aimed at reviving the economy from deflation and achieving growth targets. However, Wednesday's U.S. data showing a decline in new home sales had minimal market impact, despite Tuesday's report revealing the sharpest drop in U.S. consumer confidence in three years, escalating concerns about the labor market.

The U.S. central bank kicked off an anticipated series of interest rate reductions with a significant half-percentage-point cut last week. According to the CME Group's FedWatch Tool, market expectations for another 50-basis-point cut in the Fed's November meeting surged to about 60% from 53% the previous day. Chip Hughey from Truist Advisory Services pointed out the counter-intuitive rise in yields at the start of the Fed's rate-cutting cycle.

(With inputs from agencies.)