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MPC Markets Morning Call — 30 September 2026: Bonds Tighten Their Grip as 30-Year Yield Hits 2002 High
Wall Street slipped as Treasury yields surged to multi-decade highs ahead of PCE data, while oil fell nearly 4% on Gulf export recovery and the RBA hiked to a 15-year high of 4.60%.
US equities closed slightly lower on Tuesday as the bond selloff deepened, with the 30-year Treasury yield touching 5.62% — the highest since June 2002 — and the 10-year hitting 5.29%, a level not seen since 2007. The Dow shed 0.3%, the S&P 500 lost 0.2% and the Nasdaq was essentially flat. Consumer confidence plunged to a 12½-year low and JOLTS job openings missed estimates, painting a picture of growing household unease even as the labour market holds. NY Fed President Williams pushed back against an October rate hike, saying there is “no urgency” to act, which trimmed FedWatch odds to roughly 50–50. Oil was the session’s relief valve: WTI tumbled 3.9% to US$89.01 as Saudi Yanbu loadings resumed and the Trump administration ordered another SPR release. In Australia, the RBA lifted the cash rate 25bp to 4.60% — a 15-year high — citing elevated inflation, the Iran war and AI-driven price pressures. The Aussie dollar drifted near a two-month low at US69.9¢. Gold recovered 1.4% after Monday’s 4% smash. SPI futures point to a flat-to-softer open near 8,744, with monthly CPI due locally and US PCE tonight.
The US 30-year yield hit 5.62%, its highest since June 2002, as the global bond selloff deepened on inflation fears and heavy corporate issuance.
NY Fed’s Williams said there is “no urgency” for an October hike, cutting FedWatch odds to about 50% from nearly 70%.
WTI crude fell 3.9% to US$89.01 as Saudi Red Sea exports resumed via Yanbu and the US ordered another SPR release.
US consumer confidence plunged to a 12½-year low of 81.9, well below the 89.2 consensus, reflecting household unease over rates and the Iran war.
The RBA hiked the cash rate 25bp to 4.60% — its fourth increase of 2026 and the highest since late 2011 — keeping a hawkish bias on inflation risks.
Anthropic’s IPO prospectus targeted a US$2 trillion-plus valuation while OpenAI sought a US$30 billion bridge round, keeping the AI mega-cap theme alive.
Wall Street: Yields Call the Tune
US equities finished Tuesday in mild red as Treasury yields resumed their climb ahead of Wednesday’s PCE print and Friday’s payrolls. The Dow fell 131.59 points (−0.26%) to 51,349.92, the S&P 500 lost 12.85 (−0.17%) to 7,670.84 and the Nasdaq Composite slipped 22.84 (−0.09%) to 26,797.54. The Nasdaq 100 edged up 0.21% to 30,339.33. Breadth was soft: NYSE decliners outnumbered advancers 1.66-to-1 and the S&P posted just eight new 52-week highs against 33 new lows.
The Conference Board’s September consumer confidence index plunged to 81.9 — a near 12½-year low and well below the 89.2 consensus — with households expecting worse business and labour conditions. JOLTS August job openings fell 256,000 to 7.079 million, below the 7.225 million estimate, reinforcing a “low-hire, low-fire” labour backdrop.
NY Fed President John Williams said one more rate increase this year “may be appropriate” but stressed there is “no urgency” to act following the September hike. CME FedWatch odds of an October 25bp move fell to about 51.5% from nearly 70%. Evercore read the remarks as “most consistent with skipping October and hiking in December.” Governor Michael Barr and Chicago Fed’s Goolsbee maintained hawkish stances, with Goolsbee warning that allowing inflation to stay above target for 5½ years is “playing with fire.”
Bonds: Multi-Decade Highs
Tuesday extended the long-end selloff into fresh multi-decade territory. The 10-year closed at 5.255% after a session high of 5.293% — the highest since June 2007. The 30-year closed at 5.594% after touching 5.621%, its highest since June 2002. BMO’s Ian Lyngen said the Middle East conflict and forward inflation remain the primary macro narrative for US rates. Investors are demanding more term premium amid government spending, heavy corporate issuance — including Paramount Skydance’s US$32 billion investment-grade deal — and AI-related borrowing.
Treasury Secretary Bessent urged the Fed to keep an “open mind,” arguing that AI productivity gains and deregulation will help cool inflation. He also said Iranian oil deliveries to China will stop within two weeks. Germany’s 10-year ended at ~3.63% (−2bp); UK 10-year at ~5.41% (−1bp).
Oil & Iran: Gulf Exports Resume
Crude reversed sharply lower on Tuesday as physical-supply relief outweighed the unresolved Hormuz standoff. WTI settled at US$89.01 (−3.9%) and Brent dropped below US$103. Saudi Arabia’s East-West pipeline flows moved higher and tanker loadings resumed at the Red Sea port of Yanbu, improving the Gulf export outlook. Kpler data showed Middle East crude exports rebounding to their highest since the war began in late February.
The Trump administration ordered another release of oil from emergency reserves amid the US–Iran stalemate. President Trump denied media reports that Washington was prepared to ease sanctions or release frozen funds, saying he has “offered Iran nothing.” Qatari mediators were still expected to hold separate talks with both sides. Diesel remains the acute pain point, with the White House considering broader red-dyed diesel sales.
Movers & Corporate
FICO −26.5% to US$617.87 after FHFA Director Pulte said Fannie Mae and Freddie Mac will move to a single pricing grid — the session’s clearest idiosyncratic shock.
CarMax +4.7% to US$59.23 on a second-quarter profit and revenue beat.
Carnival +13%, top S&P 500 gainer, after comfortably beating adjusted profit expectations with record booked occupancy for FY27.
Meta +3.3% to US$738.79 amid the broader AI bid; Apple −2.7% on CEO Ternus’s product development overhaul; Boeing +1.8% bounce; Broadcom +1.6%.
Anthropic’s IPO prospectus showed revenue surging 12-fold in 2025 to nearly US$4.6 billion, but a US$42 billion net loss including a ~US$34 billion accounting charge. It is targeting a valuation above US$2 trillion. OpenAI is seeking a US$30 billion bridge round at a ~US$1.4 trillion valuation after pushing back IPO plans. Trump hosted 31 AI executives at the White House, ruling out new regulation and signing a voluntary review accord plus a “super intelligence” rebrand.
FX & Commodities
The Aussie dollar drifted near a two-month low around US69.9¢ after the RBA’s Tuesday hike, with traders paring bets on a further November move. DXY firmed to 101.39; EURUSD hit a 16-month low at US$1.1340; GBPUSD US$1.3231; USDJPY ~157.33.
Gold recovered 1.4% to US$4,175.01 after Monday’s roughly 4% smash, though real-yield and dollar headwinds capped upside. Silver ~US$61.85. Copper steadied on a Chile mine strike threat. Iron ore was little changed ahead of China’s National Day holiday. China unveiled mortgage subsidies and higher relending quotas for tech and infrastructure in a modest stimulus step; Morgan Stanley called the package “unlikely to reverse confidence-driven household de-leveraging.”
ASX & Australia
The RBA raised the cash rate 25bp to 4.60% at 2:30pm AEST Tuesday — unanimous, its fourth hike of 2026, and the highest since late 2011. The board cited inflation remaining elevated, a broader Middle East conflict pushing energy prices well above August forecasts, AI-related tech-goods inflation, and domestic capacity pressures. Governor Bullock said the global bond selloff “is not worrying me at the moment” but the board is watching closely. Macquarie Bank will lift variable home-loan rates by 0.25% from 15 October.
The ASX 200 still closed +0.34% at 8,709.3, led by Information Technology (+4.61%) on the back of Codan’s ~24% surge after guiding H1 net profit to at least $160 million and Megaport’s +9.4% jump on three AI infrastructure contracts worth nearly $1 billion. Codan overtook WiseTech as the ASX’s largest tech name. Banks slipped ~0.36%; Karoon extended Monday’s production-downgrade washout (−6.75%). Cochlear faces a shareholder class action over its FY26 profit forecast.
Day Ahead: Key Events — Wednesday 30 September
- ABS Monthly CPI Indicator (Aug) — Key local inflation read after yesterday’s RBA hike; watch for energy and services components.
- US PCE Price Index (Aug) — The Fed’s preferred inflation gauge; core PCE consensus ~0.2% m/m. Due 8:30am EDT / 10:30pm AEST.
- US Personal Spending (Aug) — Released alongside PCE; watch for consumer resilience after the confidence plunge.
- ADP Private Payrolls (Sep) — Preview of Friday’s non-farm payrolls; any upside surprise could reignite October hike pricing.
- Micron earnings (after US close) — Key AI/semiconductor demand signal; guides for DRAM pricing closely watched.
- China official PMIs (Sep) — Manufacturing and non-manufacturing; released ahead of Golden Week holiday.
- Germany CPI (Sep, prelim) — Early European inflation read; energy base effects in focus.
- Q3 end / quarter-end rebalancing — Final trading day of the quarter; watch for portfolio rebalancing flows.