Midday Mashup
Published
The Iran standoff that drove this morning's selloff has turned genuinely fluid by midday. After Trump rejected Tehran's proposal and crude spiked above $96 a barrel, oil has reversed hard to trade near $92 as US officials signal Trump is open to easing sanctions and unfreezing Iranian assets in exchange for concrete nuclear concessions, with mediators describing talks as "positive and constructive" and Iran showing flexibility on nuclear matters. Yet the picture remains contradictory: one US source tells Al Arabiya the gaps are wide and a deal is "extremely slim," while Iran's Foreign Minister Araghchi meets mediators in New York without American officials present.
The bigger story by 2 PM is the bond market, not oil. The 10-year Treasury yield has climbed to 5.27%, up 10 basis points on the session and roughly 65 basis points higher since the end of August, while the 2-year hit 4.952%, its highest since May 2024. UK gilts are at their highest since July 2007. The VIX is up 6.6%, confirming that equity stress is now a rates story as much as a geopolitical one.
Tech is absorbing the brunt of it. MongoDB shares collapsed 26% after chief executive CJ Desai abruptly resigned to take a senior role at Meta, with interim CEO Dev Ittycheria stepping back in even as guidance was reaffirmed. Qualcomm is down 6.1%, DoorDash off 6.5%, Arm Holdings down 8.1%, Carvana down 8.1%, and Credo Technology down 9.0%. Palo Alto Networks is a rare gainer, up 4.5%, alongside Ionis Pharma up 4.3% and Chipotle up 3.9%.
Gold's breakdown from this morning has extended, with miners still sharply lower as higher-for-longer rate expectations dominate over any safe-haven bid. Fed officials are leaning into that framing: Governor Cook says she expects continued inflation pressure from AI-driven demand and the Middle East conflict, while flagging risk that AI adoption could temporarily lift unemployment. ECB's Lagarde, meanwhile, says wages aren't responding to the energy shock and that traders are paring bets on an October hike to under 40%.
Elsewhere, Nvidia unveiled new open-source AI security tools aimed at preventing agent breaches like the one at Hugging Face, and a federal appeals court upheld Anthropic's designation as a national-security supply-chain risk. The through-line for markets remains the same: rates, not equities, are setting the pace.