European markets felt calmer today after a previous global bond selloff triggered market worries. US 30-year yields briefly hit 5% but then pulled back. UK 30-year yields also dipped slightly to 5.66%. In Japan, 30-year yields rose to a historical high of 3.29%. European stocks rallied, with S&P 500 futures up 0.5% and Nasdaq futures up 0.7%. In currency markets, the US dollar remained stable. The EUR/USD increased by 0.1% to 1.1648, while USD/JPY rose by 0.2% to 148.63. Gold prices held steady at $3,547, and silver remained about $40.90. However, oil prices dropped after news that OPEC+ might consider raising output again. WTI crude fell from $65.40 to $64.29, hovering just above its 100-day moving average.

Key Economic Indicators

Recent economic indicators showed that the Eurozone’s Producer Price Index (PPI) for July increased by 0.4%. The UK’s final services PMI for August was reported at 54.2. Japan’s trade negotiator plans a visit to the US, and the Bank of Japan is maintaining its position on interest rates. The sharp rise in government bond yields is a crucial signal right now. With US 30-year yields reaching 5% again, market stability is under pressure. The last US Consumer Price Index (CPI) from August 2025 was a stubborn 3.8%. We should consider using options to protect against rising yields, like buying puts on long-term Treasury bond futures. This anxiety in the bond market makes the current upswing in stocks seem fragile. We’ve seen a similar pattern before, such as in fall 2023 when rising yields abruptly ended short equity rallies. With the CBOE Volatility Index (VIX) elevated near 22, which is higher than usual, buying put options on the S&P 500 appears smart for protecting portfolios in the coming weeks.

Upcoming OPEC Plus Meeting

The OPEC+ meeting on Sunday will significantly impact oil prices. The crude’s 2% decrease to $64.29 suggests that the market is already expecting a potential supply increase. Buying put options on WTI crude futures before the meeting could be a good strategy for betting on prices dipping below the key support level of $64.25. In foreign exchange, the dollar-yen pair is just below the 149 level. While differences in central bank policies favor a stronger dollar, we should remember the heavy intervention by Japanese authorities in late 2022 when the pair crossed 150. This makes buying call options above that level risky, as a governmental response could quickly reverse any gains. Gold’s value above $3,500 shows it’s a key safe-haven asset in this uncertain environment. The metal is reacting to bond market instability and ongoing inflation, attracting buyers who seek safety. This presents an opportunity to purchase call options on gold, with the $3,500 mark serving as new support for potential further gains. Create your live VT Markets account and start trading now.

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