Market Commentary: Wednesday 3rd September

Asian equities fell to three-week lows as a global bond sell-off gathered pace. Japanese yields led the move higher, with 20-year bonds hitting levels last seen in 1999 and 30-years at record highs, while U.S. 30-year yields hovered near 5% after Tuesday’s spike. The dollar extended gains as the yen weakened on political uncertainty, and European equity futures edged up.

Long-dated government debt was under pressure worldwide as heavy fiscal spending lifted supply expectations, adding to record global corporate issuance that topped $90bn on Tuesday. Australian bonds also slid after stronger growth data reinforced the case for steady policy, while political risks in Japan further weighed on sentiment. Bessent will begin interviewing candidates for the Fed chair role on Friday.

Corporate headlines included a U.S. ruling forcing Google to share search data, a U.S. licence revocation curbing TSMC’s China operations, and further AI talent losses for Apple to Meta.

Data-wise, we have services and composite PMIs out of major European nations this morning, followed by mortgage applications in the U.S. later today.

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