Oil Climbs as US-Iran Deadlock Lifts Bond Yields: Markets Wrap
(Bloomberg) — A renewed advance in oil prices sent bonds lower after the US and Iran failed to agree on terms to end their war, dashing hopes for a revival of the Strait of Hormuz while stoking inflation concerns.
US crude settled around $98, with the near-halt of traffic through the waterway reigniting worries about further energy disruptions. The Treasury market, which has priced out the odds of Federal Reserve rate cuts this year amid the Middle East conflict, saw an increase in yields. Another rally in chipmakers left the S&P 500 near its all-time highs, but most of the US equity benchmark’s shares retreated.
President Donald Trump is meeting with his national security team to discuss the way forward in the Iran war — including possibly resuming military action — amid a deadlock in negotiations, Axios reported.
The ceasefire between the US and Iran reached a particularly precarious moment as Trump said the deal was on “massive life support.” Speaking to reporters, he called Tehran’s response to his proposal a “piece of garbage.”
“An agreement remains elusive and risks remain elevated,” said Mark Haefele at UBS Chief Investment Office. “Both sides remain under pressure to conclude a deal.”
The conflict with Iran will be on Trump’s agenda when he meets Chinese President Xi Jinping later this week. Revenue that China provides to Iran as well as potential weapons exports would be among the topics discussed at the summit, according to a US official who briefed reporters on a conference call over the weekend.
On the economic front, a fresh batch of data this week is likely to affirm Americans’ growing frustration with inflation. Economists see a 0.6% increase in the consumer price index for April, based on the Bloomberg survey median estimate. That’s on the heels of March’s biggest monthly advance since 2022.
Tuesday’s CPI report will be a “spicier” set of figures, the first in a series of readings this week that will feed into the Fed’s preferred measure of inflation, Morgan Stanley’s Matt Hornbach told Bloomberg Television’s Surveillance.
Goldman Sachs Group Inc. and Bank of America Corp. were the latest in a growing cohort of Wall Street banks pushing back their forecasts for rate cuts, arguing that both inflation and jobs data make a case for the Fed to keep rates on hold until at least the end of the year.
Elsewhere, UK bonds were swept up in another selloff as investors grew increasingly anxious about Britain’s finances, given the risk of fresh challenges to Prime Minister Keir Starmer’s leadership.
Corporate Highlights:
The war in Iran has sent fertilizer prices soaring, but that’s not creating a windfall for producer Mosaic Co. The US’s biggest phosphate fertilizer producer struggled to stay profitable amid the Strait of Hormuz’s disruption. Cerebras Systems Inc. increased the size of its initial public offering, now seeking to raise as much as $4.8 billion, as demand for the artificial-intelligence chipmaker and data center operator’s shares continues to build. KKR & Co. is injecting $300 million into a private credit fund it manages with Future Standard as performance continues to deteriorate. Barrick Mining Corp. said it will repurchase as much as $3 billion of its shares as the world’s third-largest gold producer woos investors before spinning off its North American assets later this year. Circle Internet Group Inc. jumped amid optimism over the prospects of the stablecoin issuer’s ARC blockchain project and as US lawmakers move toward considering a landmark digital asset bill. Some of the main moves in markets:
Stocks
The S&P 500 rose 0.1% as of 3 p.m. New York time The Nasdaq 100 rose 0.2% The Dow Jones Industrial Average was little changed The MSCI World Index rose 0.1% Currencies
The Bloomberg Dollar Spot Index was little changed The euro fell 0.1% to $1.1775 The British pound was little changed at $1.3630 The Japanese yen fell 0.3% to 157.21 per dollar Cryptocurrencies
Bitcoin rose 1.4% to $81,884.98 Ether rose 0.4% to $2,336.58 Bonds
The yield on 10-year Treasuries advanced five basis points to 4.41% Germany’s 10-year yield advanced four basis points to 3.04% Britain’s 10-year yield advanced nine basis points to 5.00% Commodities
West Texas Intermediate crude rose 2.8% to $98.12 a barrel Spot gold rose 0.2% to $4,726.63 an ounce ©2026 Bloomberg L.P.
