Stocks Rise as Oil Drop Offsets Europe Debt Worry: Markets Wrap
(Bloomberg) — A drop in oil prices brought some relief to Wall Street, offsetting concerns over Europe’s public finances that sent the euro to its weakest level since May 2025.
In a volatile session, US crude dropped to around $90. The S&P 500 rose for a third straight day. Renewed political uncertainty in Europe left Treasury 10-year yields near the highest since 2002, but boosted the dollar’s haven appeal. Brazilian assets soared as market-friendly Flávio Bolsonaro became the front-runner to win the Oct. 25 presidential election runoff.
While crude has rallied strongly this year amid the Middle East conflict, energy flows have been rising toward pre-war levels in recent weeks. Iran’s interior minister headed to Doha for talks with his Qatari counterpart and other officials, the semi-official Iranian Students’ News Agency reported.
Meantime, investors remained on edge over parts of the European bond market after a recent selloff triggered memories of the debt crisis. Spanish Prime Minister Pedro Sánchez called for snap elections on Nov. 29, injecting fresh political risk into markets already grappling with strains in French and other vulnerable sovereign debt.
With stocks near record highs, managing concentration risk and strengthening portfolio resilience remain important as investors navigate geopolitical risks and elevated bond yields, said Ulrike Hoffmann-Burchardi at UBS Chief Investment Office.
“We believe equities have room to move higher over the next six to 12 months amid resilient economic growth and robust earnings,” she noted. “But the path is unlikely to be smooth.”
On the economic front, the US service sector expanded at a slower pace in September while a price gauge climbed to a four-year high. Overall, the data points to mounting inflationary pressures and strong nominal growth — reinforcing a central bond-bearish underpinning over the past several weeks, according to Vail Hartman at BMO Capital Markets.
Bond yields are continuing their relentless march higher, but equities have been remarkably resilient — even though breadth beneath the surface has been historically weak, noted Jason Pride and Michael Reynolds at Glenmede.
“Relative equity market calm amid the bond market’s ‘perfect storm’ is understandable, given accelerating economic growth and the AI boom’s rate insensitivity,” said Lisa Shalett at Morgan Stanley Wealth Management.
Investors have gotten too bearish on stocks, with earnings expected to remain robust and the surge in bond yields looking increasingly stretched, according to JPMorgan Chase & Co.’s strategists led by Mislav Matejka.
A drop in US stock valuations has left some areas looking attractive as earnings growth shows few signs of waning, according to Morgan Stanley’s Michael Wilson. The extent of the pullback has created a “better setup” for sectors linked to the economic cycle where the fundamental outlook remains robust, he said.
Corporate Highlights:
Intel Corp. fell after a report on discussions of a potential collaboration between Taiwan Semiconductor Manufacturing Co. and Elon Musk’s Terafab initiative, which the US chipmaker joined in April. Cerebras Systems Inc. rallied after OpenAI Chief Executive Officer Sam Altman said the company is a “close partner,” and the two firms have a deep engagement pushing on the frontiers of speed. CH Robinson Worldwide Inc. agreed to buy trucking brokerage firm RXO Inc. in a deal centered around a bet that artificial intelligence can help the companies improve efficiency in a challenging freight market. Cenovus Energy Inc. agreed to buy Athabasca Oil Corp. for about C$5.8 billion ($4.1 billion), expanding its footprint in the Canadian oil sands. Nvidia Corp. partner Hon Hai Precision Industry Co. reported better-than-expected quarterly revenue, signaling sustained and elevated spending on global AI infrastructure. Some of the main moves in markets:
Stocks
The S&P 500 rose 0.4% as of 10:55 a.m. New York time The Nasdaq 100 rose 0.6% The Dow Jones Industrial Average fell 0.2% The Stoxx Europe 600 rose 0.4% The MSCI World Index rose 0.3% Currencies
The Bloomberg Dollar Spot Index rose 0.1% The euro fell 0.4% to $1.1206 The British pound fell 0.2% to $1.3217 The Japanese yen fell 0.1% to 158.02 per dollar Cryptocurrencies
Bitcoin fell 0.3% to $85,588.43 Ether was little changed at $2,704.07 Bonds
The yield on 10-year Treasuries advanced four basis points to 5.31% Germany’s 10-year yield advanced three basis points to 3.49% Britain’s 10-year yield advanced five basis points to 5.42% The yield on 2-year Treasuries was little changed at 4.83% The yield on 30-year Treasuries advanced five basis points to 5.67% Commodities
West Texas Intermediate crude fell 0.8% to $90.37 a barrel Spot gold rose 0.1% to $4,146.60 an ounce ©2026 Bloomberg L.P.
