> ## Content Index > Fetch the complete content index at: https://www.yardeniquicktakes.com/llms.txt > Use this file to discover other available public pages before exploring further. # GLOBAL MARKETS CALL: French Toast & Brazilian Bossa Nova - URL: https://www.yardeniquicktakes.com/global-markets-call-french-toast-brazilian-bossa-nova/ - Published: 2026-10-11T00:14:50.000Z - Updated: 2026-10-11T04:00:31.000Z - Author: Ed Yardeni - Tags: Global Market Call, Global Bonds, Global Stocks **I. Bonds** The global bond market remains jittery, though yields may be starting to stabilize after their rout in recent months (chart). Nevertheless, geopolitical turbulence may still buffet them. ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-92.png) Yields have risen for an assortment of reasons, from better-than-expected economic growth (US) to fiscal instability concerns (France). Brazil and China are the only major countries showing declines in bond yields so far this year (chart). Bond yields have also risen on higher-for-longer oil prices as the war in the Middle East has continued to disrupt oil supplies. The Houthis have said airliners should avoid Saudi airspace, declaring it a zone of military operations after the Saudi-backed Yemeni government launched an offensive ⁠against the group earlier this month. On Saturday, a third attack this week on Riyadh's international airport left 12 people dead and dozens wounded. President Donald Trump said the US will "look at" joining Saudi strikes on Houthis. ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-88.png) **II. Stay Home vs Go Global** So far this year, the US has held onto its 65% market-cap share of the All Country World (ACW) MSCI (chart). Japan's share has also held steady at 5%. However, Europe's share has slipped (13.3%) to the advantage of the share of the Emerging Markets (12.0%). ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-86.png) Nevertheless, last week, the US outperformed the Developed World ex-US as the French debt crisis weighed on European stock prices (chart). ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-19.jpg) So far this month, the US MSCI is the second-best-performing stock price index we track (chart). Brazil was the best-performing in response to first-round presidential election results showing conservative Flavio Bolsonaro, son of former President ⁠Jair Bolsonaro, exceeding expectations in the race against leftist President Luiz Inacio Lula da Silva. ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-81.png) **III. Earnings & Valuation** The ratio of forward earnings for the US MSCI to the ACW ex US MSCI fell through the summer this year (chart). It stopped doing so in recent weeks. ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-90.png) Forward P/Es have been falling worldwide since the start of the year, as forward earnings have outpaced stock price gains (chart). ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-85.png) **IV. Currencies** The French debt crisis is also weighing on the euro, which is down from $1.20 at the start of this year to $1.12 (chart). ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-95.png) As a result, the DXY dollar index has rebounded to its best reading since early 2025 (chart). We remain constructive on the US dollar. ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-96.png) **V. Notable** (1) German factory orders fell sharply in August, plunging 10.6% m/m (chart). The primary driver behind the contraction was a steep pullback in large-scale contracts. The headline drop was almost entirely due to a 61.5% slump in large-scale orders for aircraft, ships, trains, and military vehicles, which suffered a major correction following an exceptional surge in July. When these volatile large-scale contracts are excluded, new manufacturing orders actually slipped by just 0.1%, indicating that core industrial demand was essentially treading water rather than experiencing a broad-based collapse. ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-91.png) (2) CQQQ continues to underperform QQQ (chart). While China's long-term industrial policy goals are ambitious, cyclical demand inside China has struggled to generate the same explosive revenue growth seen in Western tech sectors. Furthermore, China's tech industries carry a persistent regulatory discount. Chinese technology sectors have historically been vulnerable to abrupt policy shifts, anti-monopoly crackdowns, data security reviews, and ongoing geopolitical tensions (including US–China trade restrictions and semiconductor export controls), which compress valuations and deter long-term institutional capital inflows. ![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2026/10/gateway-93.png) 💡 Join the discussion with Ed below! To leave comments or questions, log in to the Yardeni QuickTakes website and post them at the end of the QuickTakes article. Paid members' contributions may be featured in our segment, "Ed Answers Your Questions".