GLOBAL MARKETS-Oil eases, bringing some respite to stocks and battered bonds

World stocks rose on Friday and oil prices slipped after ‌US ​President Donald Trump said the US would not attack Iran before next month's midterm elections, easing some near-term concerns about energy supplies. Investors remained cautious, however, as they weighed another wave of fundraising by technology companies while borrowing costs in some of the world's biggest economies hovered near multi-year ‌highs.

European shares were broadly firm and US stock futures pointed to gains on Wall Street later in the day. Brent crude futures fell over 1% to just under $103 per barrel after surging more than 4% in the previous session. MSCI's broadest index of Asia-Pacific shares outside Japan also rose, while Japan's Nikkei closed little changed on the day.

"We are in a period following the central bank policy meetings and before ‌earnings season, which means that markets are more vulnerable to being whiplashed by day-to-day commentary," said Guy Miller, chief market strategist at Zurich Insurance Group. "Equity markets are still robust. They've been ‌able to weather much higher bond yields and the volatility within these markets well and the outlook is good as we head towards earning season."

The third-quarter earnings season kicks off next week with a number of Wall Street banks set to report. US Treasury yields ticked up in Europe after falling on Thursday, when a sale of 30-year government bonds drew solid demand.

In Europe, government borrowing costs were broadly lower after a sharp selloff driven most recently by worries about high inflation ⁠and France's fiscal ​outlook. The premium investors demand to hold 10-year French ⁠debt over German Bunds was trading at about 137 basis points, and was on track to narrow by around 3 bps over the week.

France has been hit particularly hard by the global bond selloff as investors scrutinise its debt ⁠burden, budget deficit and political outlook ahead of the 2027 presidential election. CHIPS?

Chip stocks remained in focus after coming under pressure on Thursday on concerns about OpenAI. Reuters reported that the ChatGPT owner told investors its annualised September ​revenue was almost $50 billion, below earlier signals, although Bloomberg reported the firm could reach or exceed $70 billion by year-end.

"Investors are becoming more discriminating about AI valuations while renewed demand for ⁠government bonds is emerging at elevated yields," said Florian Ielpo, head of macro at Lombard Odier. Investors were also assessing a fresh wave of fundraising, with SpaceX, Broadcom and Oracle all expected to raise billions of dollars to buy advanced AI chips.

Australian data ⁠centre ​operator Firmus, backed by Nvidia , shelved its $5-billion initial public offering, citing market volatility, and said it would pursue a private fundraising round instead. A combination of higher energy costs, expectations of further central bank interest-rate hikes and concerns about rising government debt has fuelled a months-long global bond selloff, pushing borrowing costs higher.

"With long-term yields back around multi-decade highs, investors no longer have the luxury ⁠of valuing AI growth in a low-cost-of-capital world," said Charu Chanana, chief investment strategist at Saxo. Higher sovereign yields and rising corporate debt issuance to fund AI infrastructure mean capital is becoming "both more expensive ⁠and more selective, which puts balance sheets and ⁠the quality of future earnings firmly in focus," Chanana said.

In currency markets, the dollar stood tall as the euro headed for a fifth consecutive weekly decline, trading at $1.121 and near the 17-month low touched earlier this week amid concerns over French debt. Gold rose more than 1% to ‌around $4,180 an ounce, helped by a slightly ‌softer US dollar and lower oil prices.