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VONNIE: 5:00 IN NEW YORK CITY, 10:00 IN LONDON. LET'S GET YOU SET UP FOR THE DAY. CONCERNS AROUND DEFICIT FOR AI. FUELING A GLOBAL BOND ROUT. RISK OFF INEQUITIES. OIL PUSHING HIGHER AS PROSPECTS IS DIM FOR A U.S. PLAN AS ANOTHER VESSEL IS ATTACKED IN THE STREET. META HEADED TO COURT AS THE SOCIAL MEDIA DICTION TRIAL BEGINS WITH POTENTIAL PENALTIES ON -- OF $1.4 TRILLION. CHECK ON MARKETS AROUND THE WORLD. WINNIE HSU WITH THE LATEST IN ASIA.

W ALL ABOUTINNIE: -- WINNIE: ALL ABOUT BONDS IN ASIA TODAY. THAT IS REALLY SHOWING UP IN THE ASIA SESSION TODAY WE HAVE THESE LOCAL CONCERNS AS WELL AS EXPECTATIONS FOR THE BANK OF JAPAN TO RAISE RATES GIVEN THE WEAKNESS IN THE YEN. THE BRIGHT SPOT IS IN THE -- WE SAW YIELDS FALLING A LITTLE BIT AFTER THOSE STRONG AUCTIONS SHOWING DEMANDS OF THE HIGHEST SINCE JUNE OF LAST YEAR DRIVEN BY THIS HIGH YIELDS SHOWING UP WITH SOME ATTRACTIVENESS FOR INVESTORS AS WELL.

SEEING HOW THAT'S AFFECTING THE BROADER ASIA MARKET. ESPECIALLY TO THE TECH STOCKS GIVEN THE HIGH VALUATION. YOU ARE SEEING JAPAN'S NIKKEI LEADING LOSSES AND ALSO DRAGGING THE BROADER ASIA INDEX DOWN ABOUT 1% AFTER FOUR DAYS OF GAINS. OVERALL WE ARE SEEING SOME WEAKNESS FROM THE JAPANESE YEN INCHING CLOSER AGAINST THE DOLLAR BY THE STRENGTH IN THE OIL PRICES AS WELL. VONNIE: THANK YOU FOR THAT. WE GET TO LONDON FOR A LOOK AT THE EUROPEAN SESSION WITH JUSTINA LEE.

JUSTINA: IT IS ALSO ALL ABOUT BONDS HERE WITH THE STOCKS EURO 600. 0.5% IN THE FIFTH STRAIGHT DAILY LOSS. LED BY A LOT OF THOSE TECH SHARES. BAD NEWS FOR THOSE KINDS OF SECTORS TO COUNT ON LONG-TERM CASH FLOWS. LOOKING AT THE BOND MARKET WE CAN SEE A RISE IN BOND YIELDS FOR THE U.K. 30 YEAR YIELD. IF WE FLIP THE BOARD THERE'S A FOCUS ON GERMAN BOND YIELDS TODAY BECAUSE THEY ARE SELLING THESE LONG AND 30 YEAR BONDS AND IT HAS RISEN TO A 15 YEAR HIGH.

REFLECTING SOME BROADER GLOBAL TRENDS HERE. WE ALSO SEE THEM TALK MORE ABOUT DEFENSE INFRASTRUCTURE SPENDING AND THAT IS ALSO FUELING THAT A IN YIELDS. VONNIE: ALL ABOUT BOND YIELDS HERE IN THE U.S. AS WELL. WE HIT ABOUT 2007. TODAY WE ARE AT 530 TO 10 ON THE 30 YEAR YIELD SPREAD SEEN YIELDS MOVE HIGHER BUT MUCH MORE SO ON THE LONG END. WE ARE SEEING SOME STEEPENING. WE ARE REALLY MORE SEEING THIS AT THE BACK END. WE WILL BE SPEAKING ABOUT THE COMMENTS ON BOND VIGILANTES.

PERHAPS PUSHING THE PANIC BUTTON AT SOME POINT. BUT LET'S LOOK AT EQUITIES. ED HAD A COMMENT ABOUT EQUITIES WITH A MODEL ALAN GREENSPAN USED TO SEE WHETHER THE S&P 500 WAS OVER OR UNDERVALUED RELATIVE TO BOND YIELDS WAY BACK WHEN. HE FOUND WHEN HE PUT IT TO WORK IT SHOWS THE S&P IS NOT OVERVALUED WHEN IT COMES TO BOND YIELDS. THAT WON'T HAPPEN UNTIL WE HAD 5% ON THE 10 YEAR. WE CAN REST EASY SEEING THESE RECORDS. FUTURES ARE POINTED LOWER.

RISK OFF SENTIMENT IS NOT HELPING. ALSO TURMOIL POTENTIALLY IN WAITING THERE. BUT ALSO SOME GREAT DAYS. THE RUSSELL 2000 HIT A RECORD AND IS HAVE A NICE STREAK. OF COURSE THERE IS OIL TO THINK ABOUT. WE ARE HIGHER ONCE AGAIN ON OIL. BRENT CRUDE OFF THE HIGHS OF THE SESSION. NEW YORK ACCRUED JUST BELOW 85. GOLD AS WELL 11 STRAIGHT SESSIONS WHERE WE ARE HIGHER. OFF JUST A LITTLE BIT BUT PUSHING THAT $4400 MARK. THIS TUESDAY MORNING WE GO WITH CHLOE MELEY.

CHLOE: AI RELATED STOCKS ARE DOWN THIS MORNING GIVING UP THE GAINS FROM THE RALLY YESTERDAY. WE HAVE THIS RISK OFF SENTIMENT SETTING IN DRAGGING DOWN THE LIKES OF NVIDIA INTEL AND BROADCOM AND WEIGHING ON U.S. FUTURES AS WELL. WE ARE ALSO READ -- DOWN SIGNIFICANTLY AFTER THE REPORTED RESULTS WITH AYOTTE -- WITH DISAPPOINTING SALES. THIS UNDERWHELMING PERFORMANCE IN THAT KEY DIVISION IS SOMETHING INVESTORS ARE FOCUSED ON.

DOWN MORE THAN 9% THIS MORNING OFF THE BACK ABOUT EARNINGS SPRINT. HM PLACED ON EIGHT POSITIVE CATALYST WITH THE ANALYST SAYING THEY SHOWED QUITE A BIT OF RESILIENCE IN THE THIRD QUARTER RESULTS LATER IN SEPTEMBER. WE ARE UP ABOUT THREE OR 4% ON THE BACK OF THAT UPGRADE. VONNIE: THANK YOU SO MUCH. CHLOE WILL BE BACK LATER IN THE HOUR. MORE ON THIS BOND SELLOFF WITH KATRINA DUDLEY A FRANKLIN TEMPLETON PURDON LONG DATED BOND YIELDS PUSHING FURTHER AS SOVEREIGN BOND RATES RISE AROUND THE WORLD.

U.S. 30 YEAR YIELD UP THE HIGHEST SINCE 2000 SEVEN. JOINING US IS VEN RAM. I MENTIONED NOTES SAYING HE'S NOT PUSHING THE PANIC BUTTON BUT WATCHING IF THE BOND VIGILANTES WILL AT SOME POINT MAYBE WHEN THE 10 YEAR YIELD GETS TO 5%. WHAT WOULD THAT LOOK LIKE, WILL THAT BE SOME TYPE OF TURBULENCE? VEN: I THINK IT WILL MEAN HIGHER VOLATILITY AND I THINK IF YOU LOOK AT THE MEASURES, THE VOLATILITY MEASURES ARE STILL RATHER MUTED.

IF THAT HAPPENS WITH HIM SAYING HAPPENS, BUT I THINK THERE IS ASSISTANT -- BUT I THINK THERE IS A DISTINCT POSSIBILITY. YOUR HYPERSCALERS ISSUING 1.5 TRILLION WORTH OF DEBT SO FAR THIS YEAR ALONE. FOR THE BIGGEST FUNDRAISING SINCE 2020. I THINK WHAT WE ARE SEEING IS THE COMBINATION OF HYPERSCALERS THEN WE'VE GOT THE FISCAL CONCERNS WHICH HAVE BEEN LINGERING IN THE MARKETS FOR YEARS AND THEN WE HAVE ALSO HAVE INFLATION TRENDING FOR FIVE YEARS NOW ABOVE 2%.

SO YOU'VE GOT A PERFECT STORM THAT IS INDUCING ALL OF THIS IN THE BOND MARKET. WE ARE IN A SITUATION WHERE THE STRUCTURAL INTEREST RATES ARE MOVING HIGHER A MESS THE MOST IMPORTANT TAKE AWAY HERE BECAUSE A FEW YEARS AGO WE WERE IN THIS 0% INFLATION AND INTEREST REGIME. NOW WE HAVE MOVED TO A 5% INTEREST RATE REGIME. THAT IS HUGE IN THE SPACE OF A FEW YEARS AND SHOWS DEMAND FOR FUNDS IS HIGHER AND THAT IS AFFECTING THE EQUILIBRIUM RATE FOR NEUTRAL RATE OF FUNDS.

VONNIE: WHAT CAN AUTHORITIES DO FOR THE LONG END SHORT OF ENGINEERING SOME KIND OF ECONOMIC SLOWDOWN. VEN: WHAT THEY CAN DO IS THE POWER TO BRING DOWN INFLATION. WE HAVE SEEN THIS ENVIRONMENT WHERE IF YOU LOOK AT THE U.K., INFLATION IS NOT UNDER CONTROL. IF YOU LOOK AT THE U.S.. 2% INFLATION FIVE YEARS NOW AND IN JAPAN AS WELL TRYING TO COME TO GRIPS WITH INFLATION. SO YOU'VE GOT THIS SITUATION WHERE INFLATION IS NOT FULLY CONTAINED AND AUTHORITIES COULD BRING THAT DOWN TO INSPIRE CONFIDENCE IN THE MARKETS BUT WHEN THEY SAY 2% INFLATION THEY MEAN 2% INFLATION.

VONNIE: THERE'S A LOT OF ISSUING AT THE SHORT END. WE HAD NICE DEMAND IN JAPAN FOR JGB SPRING HYPOTHETICALLY WHAT IS THE PROBLEM WITH ISSUING MORE THE SHORT END IF THAT'S WHAT THE TREASURY HAS TO DO? VEN: IF YOU'RE GOING TO ISSUE COUPONS TAKE IT OUT BY HIGHER YIELDS SUBSEQUENTLY IT IMPOSES LOSSES ON BONDHOLDERS WHICH IS WHY THERE IS A COST TO ALL OF THIS WHY INVESTORS HAVE BEEN EVEN THOUGH JAPAN'S ISSUANCE WAS WELL RECEIVED I THINK THE SECOND REPORT MARKET IS A JUDGE OF WHAT HAPPENS IN THE BOND MARKETS AND THEY ARE THE YIELDS ARE MARCHING HIGHER.

BONDHOLDERS WILL FACE LOSSES IF THEY ARE BUYING INTO A HIGHER RATE ENVIRONMENT. VONNIE: WONDERFUL STUFF ON THE BLOOMBERG AS WELL. BLOOMBERG'S VEN RAM. OIL GAINING FOR A THIRD DAY WITH NO RESOLUTION -- WITH THE RESOLUTION OF THE IRAN WAR LOOKING CLOUDY. THE PRESIDENT SAYING HE'S NOT INTERESTED IN EXTENDING THE AGREEMENT WITH IRAN AFTER EXPIRING YESTERDAY. IT TO IRAN SAYING THE COMMENT ABOUT BACK CHANNELS BEING ILLUSIONARY.

NOT ONLY THAT BUT WE HAVE ANOTHER ATTACK IN THE STRAIGHT. ABEER: IN THE EARLY HOURS WE SAW A REPORT BY THE U.K. NAVY SAYING AN UNIDENTIFIED PROJECT AL HAD HIT A VESSEL IN THE STRAIT OF HORMUZ. ONE CASUALTY REPORTED. OUR ENERGY TEAM REPORTING A FUEL TANKER WAS MAKING AN ERRATIC MOVES BEFORE -- NEXT TO AN ISLAND IN IRAN WHICH MEANS TRYING TO REALLY ASSERT THAT DOMINANCE IT'S BEEN TOUTING OVER THE STRAIT OF HORMUZ. WHEN IT COMES TO THE EXPIRING DATA ON THAT CEASEFIRE WITH THAT MOU, THAT HAS BEEN RENDERED MEANINGLESS ACCORDING TO A IRANIAN OFFICIALS.

SAYING THAT IS DUE TO MULTIPLE VIOLATIONS THAT HAPPENED -- COMMITTED BY THE UNITED STATES. PRESIDENT TRUMP SAID HE DOES NOT WANT TO EXTEND THAT SO WE ARE LEFT IN A STATE OF LIMBO WHEN IT COMES TO WIDER TALKS. IRANIAN AND AMERICAN OFFICIALS ARE REPORTEDLY NOT TALKING BUT THE TALKS THAT ARE ONGOING ACCORDING TO MULTIPLE REPORTS OVER THE PAST COUPLE OF WEEKS ARE THOSE BETWEEN IRAN AND OMAN TO FIND