Selloff

• The CAC 40 closed at 8,501.91 points on Wednesday, marking a slight decline of 7.45 points (0.088%) from the previous day. • The dip was driven by a broader semiconductor selloff, specifically impacting STMicroelectronics, which weighed down both the French and Italian (FTSE MIB) markets. • In contrast, London's FTSE 100 rose 0.14% to 10,743.35, as its heavy weighting in energy, financials, and healthcare insulated it from the tech rout.

• A recent surge in US long-term Treasury yields has triggered a bond market selloff, causing concern among equity investors regarding the stability of the stock market. • Technical analyst Mark and other experts identify five resilience signals, including a VIX-to-VVIX ratio of 0.17 and the continued strength of financial stocks during yield curve steepening. • Deutsche Bank strategist Maximilian Uleer warns that Brent crude exceeding $100 per barrel, combined with high long-term rates and falling inflation, would be a more critical danger signal.

• A global bond market selloff on August 19 caused long-term government bond yields to surge to multi-year highs, triggering a broad decline in equity markets. • Asia-Pacific technology sectors were hit hardest, with South Korea's KOSPI plunging 5.8% and China's STAR 50 index dropping 6.89%. • In contrast, Hong Kong's Hang Seng Index showed relative resilience by bucking the downward trend and recording a marginal gain.

• Asian equity markets declined today as a sharp selloff in semiconductor shares triggered a broader downturn across the region. • The bearish sentiment was driven by a combination of rising bond yields, escalating oil prices, and heightened Middle East tensions. • Investors are retreating from growth stocks due to mounting concerns over global inflation, increasing debt levels, and the impact of US monetary policy.

• Euro zone government bond yields paused their recent upward trend on Wednesday, following a period of stability in the U.S. Treasury market. • Despite the stabilization in bonds, global markets remain under pressure due to a continuous surge in oil prices. • The shift in bond yields reflects a fluctuating global sentiment as investors balance Treasury stability against rising energy costs.

• Yields on longer-dated euro zone bonds surged to multi-year highs on Tuesday, joining a broader global bond selloff. • The spike is driven by rising oil prices and inflation fears resulting from the lack of a quick resolution to the conflict in Iran. • Investors are now anticipating a quarter-point interest rate hike from the European Central Bank (ECB) to combat these inflationary pressures.

• South Korea's KOSPI index plunged 4.58% following a massive selloff in semiconductor stocks, specifically impacting industry giants Samsung and SK Hynix. • The severity of the decline triggered a trading halt to stabilize the market, reflecting significant volatility within Korean equities in 2026. • Frank Benzimra of Societe Generale noted that these steep declines often occur in sectors where investors utilize the highest levels of leverage.