Global Markets Rally as Fed Hints at Rate Hike; Yen Surges to Two‑Day High

Global equities and bonds advanced on Thursday, buoyed by expectations that the Federal Reserve will raise rates later this month. The U.S. 10‑year Treasury yield edged higher, while the Japanese yen surged to its biggest two‑day rally since early September, spurred by official intervention and a pullback in U.S. government bond yields. Oil slipped slightly, trading around $95 a barrel, as tensions between the United States and Iran added uncertainty.

In Europe, the STOXX 600 slipped marginally, and U.S. equity futures were up roughly 0.1%. Tech shares in the pre‑market session drew attention after earnings from Broadcom, Snowflake and Hewlett Packard Enterprise were released following Wednesday’s close.

Investors are now eyeing Friday’s U.S. payrolls data, which could confirm the softness in private‑sector hiring that was seen in August. Fed officials are also in focus: Governor Christopher Waller is scheduled to speak, while New York Fed President John Williams highlighted that the rise in long‑term yields reflects a robust economy, though he said he was still gathering information for policy decisions.

Lombard Odier chief economist Samy Chaar noted that higher yields may signal stronger nominal growth rather than merely risk‑driven pressures. He added that a demand‑driven yield environment can support multi‑asset portfolios, combining equity growth with carry from credit.

Money‑market expectations for a Fed rate increase this month have risen to about 60 %, up from below 40 % a week earlier, underscoring the market’s tilt toward a tightening stance.

Overall, the day’s moves set the stage for a cautious yet optimistic outlook as markets await key U.S. data and Fed commentary.