European stocks fell on the opening, Japan's 40-year Treasury bond yield hit a new high, Berry Oil fell below the $64 mark, and gold climbed for the fourth consecutive day

Source: Wall Street News

Due to concerns that the US tax reform plan may widen the fiscal deficit, risk - appetite sentiment has deteriorated. European stocks opened lower, Asian stocks declined, and the US Treasury bond market was under pressure. Investors flocked to safe - haven assets. Gold climbed for the fourth consecutive day, and Bitcoin hit a new all - time high, breaking through $110,000.

The yields on Japanese long - term bonds continued to rise. Previously, Akio Noguchi, a member of the Policy Board of the Bank of Japan, said that it was not appropriate to intervene in ultra - long - term yields. Brent crude oil futures fell below $64 per barrel, dropping nearly 1.6% on the day. It was previously reported that OPEC+ discussed a large - scale production increase again in July.

Before the opening of US stocks, XPeng Inc. fell nearly 6%, Li Auto Inc. dropped 1.65%, and Alibaba Group Holding Limited fell nearly 1.6%.

The Euro Stoxx 50 index opened 0.55% lower, the German DAX index fell 0.42%, the UK's FTSE 100 index dropped 0.46%, and the French CAC 40 index declined 0.43%.

The spot US dollar index changed little. The euro was almost unchanged against the US dollar, trading at $1.1333.

The Japanese yen rose 0.3%, rising for the fourth consecutive day, the longest winning streak since February 6.

The Nikkei 225 index closed 0.8% lower at 36,985.87 points. The Topix index closed 0.6% lower at 2,717.09 points. The South Korean KOSPI index closed 1.2% lower at 2,593.67 points.

The yields on Japanese long - term bonds continued to rise. The yield on 20 - year Japanese government bonds rose 5.5 basis points to 2.595%. The 40 - year yield rose 6 basis points to 3.675%, hitting the highest level since issuance began in 2007.

The yield on 10 - year US Treasury bonds changed little, at 4.59%.

The yield on 10 - year Australian government bonds rose 2 basis points to 4.47%.

Bitcoin rose 2.9% to 110,931, the highest level on record.

Spot gold rose 0.5%, climbing for the fourth consecutive day, setting the longest winning streak since February 5.

Brent crude oil futures fell below $64 per barrel, dropping nearly 1.6% on the day.

Fears of US Fiscal Deficit Intensify, Global Bond Market Under Pressure

Investors are worried that the tax reform bill will add trillions of dollars to the already bloated budget deficit in the coming years, and global investors' interest in US assets is waning.

Market strategist Mark Cranfield said that the passage of the bill will not immediately push the yield on 10 - year US Treasury bonds to 5%. But it will accelerate the steady upward trend in the bond market, as the "watchmen" of the bond market demand a higher premium for holding US bonds.

Analysts at DBS Bank Ltd. pointed out in a report:

"Risk assets are reacting to the rise in US Treasury bond yields. Stock markets are plummeting, and credit spreads are widening. We also note that the US dollar is weakening, and in the current situation, it is more like a risk asset. All in all, the'sell US' trade is making a comeback."

Japanese Bond Market Sounds Alarm, Long - Term Bond Yields Soar

Amid persistent weak demand, the yields on Japanese long - term bonds rose. The 40 - year yield rose 6 basis points to 3.675%. Previously, Akio Noguchi, a member of the Policy Board of the Bank of Japan, said that it was not appropriate to intervene in ultra - long - term yields.

The yield on 40 - year Japanese government bonds hit the highest level since issuance began in 2007. The 10 - year yield rose 5 basis points to 1.565%, and the 20 - year yield rose 5.5 basis points to 2.595%.

Nick Twidale, the chief analyst at AT Global Markets Australia, said that as the yields on Japanese government bonds soar, Japan's fiscal health could become a "concern" for global investors:

"This is a global issue, and investors are struggling to adapt to the new situation."

Currency Market Turbulence, Bitcoin Hits New High

In the currency market, the US dollar was flat against the euro but weakened against most Asian currencies, including the Japanese yen and the Indonesian rupiah, as traders weighed potential foreign exchange agreements in trade negotiations. The South Korean won maintained most of its overnight gains after local media reported discussions on currency movements with the United States.

Meanwhile, Bitcoin broke through $111,000 for the first time, and traders are increasingly optimistic about the prospects of this original cryptocurrency. Richard Galvin, co - founder of hedge fund DACM, said:

"Bitcoin and the entire cryptocurrency market have largely decoupled from the stock market in the past few days. Bitcoin continues to benefit from its market status as a non - systemic store of value, and as the global bond market begins to look vulnerable, Bitcoin has been strengthening."

OPEC+ Discusses Large - Scale Production Increase in July, Brent Crude Falls Below $64 Mark

Brent crude oil futures fell below $64 per barrel, dropping nearly 1.6% on the day. It was reported that OPEC+ plans to increase production by 411,000 barrels per day in July, the third consecutive month of production increases, aiming to put pressure on member states that have over - produced their quotas.

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