No Yielding In Sight: Global Bond Yields Push Higher Still, Earnings Season Begins Lunaro Weekly Report

(MENAFN- Mid-East Info) Nick Spencer-Skeen, Senior Executive Officer, Lunaro Markets Limited

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Friday Closing Prices (9 October 2026)

S&P 500 7,812 (+0.59%)

Nasdaq 27,366 (+0.64%)

Gold $4,294 (+1.47%)

Brent Crude Oil $104.34 (+0.51%)

Global markets spent another week grappling with a combination of rising yields and persistent inflation pressures. The US 10-year Treasury yield briefly touched 5.36%, its highest since 2002, as Brent crude remained above $100/bbl1. Fed officials signalled that further tightening may be necessary2.

European sovereign bonds remained a particular flashpoint, with fiscal concerns exacerbating the global bond selloff1. Higher borrowing costs weighed on financials, pushing the Euro Stoxx Banks index down approximately 8% over two weeks1.

US equities proved more resilient, although not without volatility. The S&P 500 reached a fresh record on Tuesday before AI sentiment weakened following questions surrounding OpenAI's revenue trajectory3. The Nasdaq recorded its steepest daily decline since August on Thursday, before technology shares recovered on Friday1. The S&P 500 ultimately gained 1.2% for the week1.

Elsewhere, Canada's unexpected loss of 68,300 jobs weakened the Canadian Dollar and dampened near-term rate-hike expectations4. EU-China trade negotiations offered some relief, but the bond market remained the overarching theme of the week.

Earnings Season Kicks Off

The third-quarter earnings season gets underway this week, with Wall Street's largest banks providing the first major test of corporate profitability against a backdrop of rising yields and persistent inflation pressures.

Goldman Sachs, Citigroup, and Morgan Stanley are among the major names reporting, with trading revenues expected to remain a bright spot5. Wall Street's five largest banks are collectively forecast to generate approximately $19 billion in equity trading revenues, supported by elevated market volatility and robust client activity5.

However, the outlook for investment banking appears less encouraging. A slowdown in IPO activity, including reported delays to anticipated listings from Oura and Anthropic, is expected to weigh on advisory and underwriting revenues6.

Beyond headline earnings, investors will be watching management commentary on credit conditions and the implications of higher borrowing costs.

A Crude Reality

Energy traders will have plenty of information to digest in the coming days, with both OPEC and the International Energy Agency (IEA) publishing their monthly oil market reports7. These reports are expected to offer fresh insight into global supply-demand balances, including the extent to which geopolitical disruptions may be affecting physical markets. Any revisions to demand forecasts or supply estimates could prove particularly consequential for crude oil prices.

Meanwhile, IEA member governments are expected to assess proposed strategic oil stockpile releases at a mid-week meeting.

With oil increasingly shaping inflation expectations and global bond yields, many more parties are watching developments in energy markets.

The Elephant in the Meeting Room

The IMF and World Bank Annual Meetings in Bangkok are a further potential source of headline risk8. The meetings, which bring together central bankers and finance ministers, see many important figures offer their opinion on interest rates and the general macroeconomic environment.

Federal Reserve Chair Kevin Warsh is expected to speak on Friday9, with investors closely watching for signals on the Fed's reaction function as elevated energy prices complicate the inflation outlook.

Sovereign debt sustainability is also expected to feature prominently, given the elevated borrowing costs highlighted in recent Week Ahead editions. The combination of persistent fiscal deficits and rising debt-servicing costs has placed renewed scrutiny on government finances.

The IMF's updated global economic forecasts will provide another focal point, particularly any revisions reflecting the recent energy shock.

Sources:

Bloomberg Terminal Pricing (US 10yr Yield, CL1, CO1, Gold, OAT 10yr, Bund 10yr, Euro Stoxx Bank Index SX7E, SPX, Nasdaq)

Fed's Musalem says tighter monetary policy needed to lower inflation | Reuters

Review & Preview: Panic Retracted – Barron's

Canada's employment unexpectedly shrinks in September, jobless rate inches up | Reuters

Big Banks' Earnings Will Have to Convince 'Glass Half Empty' Investors – Barron's

Companies Raise More Than $1 Trillion in Equity Markets, But AI, Bond Yields Sour Mood

Oil Market Report – October 2026 – Event – IEA

Annual Meetings | World Bank Group Annual Meetings Schedule | World Bank Group

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