Global stocks fall and Treasury yields rise as oil shock roils rate outlook

Global equities retreated, U.S. Treasury yields climbed and the dollar stayed near recent highs as escalating U.S.-Iran tensions and tanker disruptions drove oil sharply higher before prices eased, intensifying inflation concerns and prompting investors to reprice the Federal Reserve outlook. Brent crude rose as high as $94.9 a barrel before softening; the U.S. 10-year Treasury yield reached 4.71%-4.72% before easing to 4.67%, the two-year touched 4.37%-4.38%, the 30-year rose to 5.19%, and the U.S. dollar index paused at 101.3 after a July 23 peak of 101.5. Markets widely expected the Fed to hold rates unchanged next week, but pricing still reflected a meaningful chance of another hike later this year as July PMI data and a sharp drop in jobless claims pointed to firm growth and persistent price pressures. Gold steadied near $4,050 after a sharp drop as higher oil prices and yields reduced the appeal of the non-yielding metal.