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The bond market had a whirlwind week. Where these traders see buying opportunities

Some investors and strategists see the recent rise in yields on medium and long-term bonds as buying opportunities.

U.S. bonds had a whirlwind week, with some strategists seeing opportunities opening up for investors. The 10-year Treasury note yield last week reached 4.818%, a level not seen since November 2023 amid concerns around the impact of the U.S.-Iran war on inflation. The benchmark rate then pulled back following comments from a top Federal Reserve official in support of keeping central bank policy unchanged. On Friday, though, the 10-year crept back higher on a much hotter-than-expected jobs report . Rising yields have rattled equity market investors of late. The S & P 500 was virtually flat last week as yields climbed. Over the past month, the index is down slightly, while the 10-year has advanced roughly 16 basis points in that time. However, that move higher in yields is making certain parts of the yield curve more attractive, Oliver Shale, U.S. investment specialist at firm Ruffer, told CNBC. Specifically, he thinks increasing exposure to medium-term debt such as the 10-year Treasury. “We’re moving to a new regime, [and] to a world that’s characterized by more volatile inflation dynamics, and that the forces that suppressed inflation for decades are reversing … so, on the one hand, over the long term, yields are rising,” Shale said. “That’s not to say that bonds will always be a bad investment, and we are actually becoming increasingly interested or convinced that duration has a role to play at protecting a portfolio, particularly in a growth slowdown.” Bond yields move inversely to prices. So the more yields rise, the cheaper it becomes to buy them. Investors can buy U.S. 10-year notes directly through TreasuryDirect. They can also gain exposure through funds such as the iShares 7-10 Year Treasury Bond ETF (IEF). It has more than $42 billion in assets and charges 0.15% in fees . US10Y YTD mountain US10Y in 2026 5% a key level Gregory Faranello of AmeriVet Securities thinks an even bigger opportunity could present itself if the 10-year yield reaches 5%, or if the Fed raises rates later this month. The 10-year rate last scaled to the key 5% level in October 2023. However, traders are pricing in a 58% chance of a quarter-point rate increase on Sept. 16, according to the CME Group’s FedWatch tool. “If we move another 25 basis points here [or if] we get…maybe a little north of 5%, we like that as an opportunity,” said Faranello, his firm’s head of U.S. rates strategy. Investors should not scoop up loads of bonds right away, however. Instead, they should take a more measured, cautious approach, he added. “We’ve been advising our clients to not necessarily go in, but [to] scale in here in terms of duration,” Faranello said. He cautioned that some uncertainty exists around bonds as central banks back off from buying U.S. debt. Japan, which is a major buyer of U.S. Treasurys, has slowed its accumulation of the asset, leading its holdings to barely grow in absolute terms between 2011 and 2024, according to public policy think tank Brookings. That has left some investors to ask who will buy an ever-growing amount of U.S. debt. But, Faranello said that domestic buyers could step up to scoop up bonds, even as more are issued. “Over time, we need to find a home for this debt,” Faranello said, noting that the total federal debt in the U.S. topped $40 trillion for the first time this summer. “But, ultimately, we think that …the domestic money managers in general and investors will view any further back up in yields here as an opportunity.” Investors looking to play the rise in yields also have some options. HSBC last month highlighted several stocks that are positively correlated with the 10-year yields. Among them are private equity giant Apollo Global with a 32% correlation; Chevron at 26%; Alphabet at 21%; and Wells Fargo at 11%.

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Mistral achieves $24 billion valuation as Samsung leads funding for Europe’s AI champion

Mistral has secured €3 billion in funding led by Samsung, boosting its valuation to over €21 billion and positioning the French AI startup as a European alternative to OpenAI and Anthropic.

Mistral secures €3 billion funding round led by Samsung

Mistral announced on Tuesday that it has raised €3 billion ($3.5 billion) in new funding, spearheaded by memory chip giant Samsung, as the French startup aims to position itself as a European alternative to rivals like OpenAI and Anthropic.

The investment also involved the Scaleup Europe Fund, a European Union-backed investment vehicle managed by EQT, along with existing backer PSG Equity. Mistral stated that the funding gives it a post‑money valuation exceeding €21 billion.

A year ago, Mistral was valued at €11.7 billion following a funding round led by Dutch chip equipment maker ASML.

In an interview with CNBC, Mistral CEO Arthur Mensch said the capital will be used to build additional infrastructure, including its own data centers, and to lease computing capacity.

“In the long term, the plan is to fully rely on capacity we’re building ourselves, meaning the amount of compute we own will grow roughly 100% over the next five years,” Mensch explained.

The CEO added that the company will train “bigger and faster models.”

Headquartered in Paris, Mistral develops AI models and is expanding its data‑center footprint. It seeks a different approach from OpenAI and Anthropic by partnering with individual companies to create custom AI tools tailored to their needs and integrate them into their operations.

Mistral has integrated AI into the manufacturing process of Netherlands‑based ASML, and Mensch indicated the company will focus on a similar area with South Korea’s Samsung.

Earlier this year, Mensch projected that Mistral’s annual recurring revenue could surpass $1 billion this year. With the new funding and partnerships, he expects “to beat” that figure “if everything happens as they are trending,” though he declined to provide a revised revenue estimate.

“We’re very confident that the fundraising we’re doing today is also accelerating and enabling further growth down the line in 2027,” Mensch told CNBC.

Chinese open‑source competition

Mistral has positioned itself as a non‑U.S., non‑Chinese alternative in the AI industry, tapping into Europe’s growing desire for “sovereign AI.”

Investors in the Scaleup Europe Fund include the European Commission as well as major corporations such as Novo Holdings and Santander.

Mistral is also focusing on open‑weight AI models rather than proprietary closed systems from OpenAI and Anthropic. However, it faces intense competition from highly capable Chinese players.

Mensch said the models Mistral will release “very soon” will be “very competitive.”

He noted that Chinese AI labs are not actually operating or working with enterprise customers outside of China. In some cases, Chinese AI models can be deployed on Mistral’s infrastructure, but this “does not create a very strong dependency” on Chinese AI labs because the data remains with Mistral.

Mensch said it’s difficult for European companies to rely on long‑term support for Chinese models because it’s unclear whether they will be upgraded over time or face export restrictions.

“At this point in time, we’re seeing that the volatility in this space is actually quite extreme,” Mensch said.

“Now we also need to be a trusted partner for our customers, and they want us to be sure to certify that in one year from now they will get access to better models than they have today, and the only way we can provide that guarantee is by continuing to train our models ourselves,” Mensch added.

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Technologies

Iran Foreign Ministry takes aim at Canada for support of U.S. actions in Strait of Hormuz

Canada had condemned Iran’s “destabilizing actions” in the Middle East, saying that it would work with partners to maintain significant pressure on Iran.

Iran hit out at Canada for supporting U.S. actions in the Strait of Hormuz, calling Ottawa’s moves “a display of strategic confusion and submission to intimidation.”

In a post on X, Tehran’s Foreign Ministry spokesperson, Esmaeil Baghaei, said Canada chose to “appease” the U.S. “on the very day the U.S. president, in blatant contempt for Canada’s sovereignty and independence, portrayed the entire country as part of the United States.”

Baghaei was referring to a post by U.S. President Donald Trump on Monday stateside, which showed the U.S.′ territory covering Canada, Greenland and Iceland.

In his second term, Trump has repeatedly made comments about making Canada the 51st state of the U.S. and annexing Greenland, which is a semi-autonomous territory of Denmark.

Baghaei’s comments came after Canada condemned Iran’s “destabilizing actions” in the Middle East, saying that it would work with partners to maintain significant pressure on Iran, including via sanctions and support for efforts to reopen the Strait of Hormuz that were led by the U.S., France and the U.K.

“Canada cannot credibly present itself as a champion of ‘peace and security,’ ‘freedom of navigation,’ and ‘international law’ while simultaneously backing U.S. military aggression and Washington’s illegal, interventionist actions in our region,” Baghaei said.

“This is neither ‘diplomacy’ nor ‘responsible statecraft’. It is … a choice that will not even shield Canada itself from American bullying and aggression,” Baghaei said.

He questioned why Ottawa would choose to support Washington after experiencing what he called “American bad faith and knowing that U.S. signatures are ‘written in pencil.’”

Trade talks between Ottawa and Washington collapsed last month, with Prime Minister Mark Carney saying that the U.S. demands had gone too far. “They asked too much and offered too little,” he said.

This triggered tariffs on about $20 billion of Canadian goods, with Canada also imposing “dollar-for-dollar” retaliatory tariffs that will take effect at 12.01 a.m. ET Tuesday.

Iran has also taken aim at other U.S. allies, such as South Korea. Baghaei on Monday warned Seoul against potential military involvement and support for U.S. “aggression,” posting on X in Korean.

South Korea’s Foreign Ministry reportedly said over the weekend that it was in “close communication with relevant countries to help restore peace and stability in the Middle East as soon as possible.”

Last week, Seoul said it was reviewing options, including military measures to support freedom of navigation in the Strait of Hormuz, according to Reuters.

“Any other country maintaining a military presence or participating in [U.S.] operations in the Persian Gulf and the Strait of Hormuz can only be regarded as directly supporting the perpetrators of the aggression, and it will lead to serious consequences,” Baghaei posted.

U.S. criticisms

Late Monday, U.S. Rep. Jason Crow, D-Colo., an Army veteran and member of the Permanent Select Committee on Intelligence and House Armed Services Committee, called the war “an absolute quagmire.“

In a post on X, Crow said the conflict was “all predictable & preventable,” and called for the end of “forever wars” in the Middle East.

U.S. Defense Secretary Pete Hegseth said early on in the conflict that this would not be a “forever war” for Washington.

His sentiments were echoed by Sen. Mark Warner, D-Va., the vice chair of the Select Committee on Intelligence, who criticized Trump in a video message on X.

“The Iran war of choice that Donald Trump started cost Americans $100 billion,” he said, adding that “every two minutes, it goes up by another $1 million.” The administration was “nowhere” in terms of goals in this war, he said, adding that “this is what happens when you start a war of choice with no plan, no strategy, no allies, and no way to get out.”

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Brent crude oil hits $98 after Iran’s Houthi allies attack multiple Saudi energy facilities

Oil prices rose Tuesday on worries over escalating Mideast tensions after the U.S. and Iran traded strikes over the weekend.

Oil prices rose Tuesday after Iran-allied militants in Yemen attacked several energy facilities in Saudi Arabia, forcing a temporary halt to some operations.

Brent crude

Oil prices are up more than 8% in September as the U.S. and Iran have traded military strikes for the first time since July.

Houthi militants targeted civilian and economic assets in the cities of Abha, Khamis Mushait, Jazan and Najran, the Saudi Foreign Ministry said. More than 70 civilians were injured in the attacks, it said.

The attacks caused fires at several energy facilities resulting in temporary shutdowns, the kingdom’s Energy Ministry said in a statement. Emergency services are working to contain fires at the sites and assess the extent of damage, the world’s largest oil exporter added.

Riyadh did not disclose what type of energy facilities were struck. Houthi state media said the group attacked Saudi Aramco facilities in southern areas with drones and ballistic missiles.

Saudi Arabia “affirms its legitimate right to take all necessary measures to defend its sovereignty, safeguard its national assets, and protect the security and safety of its citizens and residents,” the Foreign Ministry said.

The attacks come after the U.S. military struck three Iranian oil tankers on Saturday in retaliation for Iranian ballistic missile attacks on two Navy warships. The Iran’s Foreign Ministry denounced the attacks on the tankers as a “war crime” and an act of “economic warfare” in a statement on Saturday. Tehran has repeatedly attacked commercial ships during the war.

“Strike our assets and you get struck,” Iranian Parliament Speaker Mohammad Bagher Ghalibaf wrote Monday in a post on X. That was in response to Defense Secretary Pete Hegseth’s post, who wrote that the U.S. “will destroy (and sink)” Iranian oil tankers if Iran fires on U.S. vessels.

Goldman Sachs on Monday raised its forecasts for Brent and WTI by $5 to $85 and $80 per barrel, respectively, for December 2026 and to $80 and $75 per barrel, respectively, for 2027.

Goldman warned that Brent could exceed $120 in 2027 if crude oil output in the Gulf remains 4 million barrels per day below prewar levels, though this is not the bank’s base-case scenario.

“We view more intense shipping attacks in Hormuz and the Red Sea as the most likely driver of this lower-output, higher-price scenario,” Daan Struyven, head of oil research at Goldman, said in a Monday note.

Goldman expects Mideast shipping disruptions to continue into 2027, with production gradually recovering by the second half of the year. “Markets are increasingly pricing a prolonged Mideast conflict,” Struyven said.

President Donald Trump in a post on Monday said that “Oil prices will drop precipitously … when we WIN the war with Iran.”

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