The US Treasury's announcement of a substantially expanded long-dated debt buyback program has interrupted the recent global bond selloff, lifting Asian equities and fixed income markets across the board, while the dollar stabilizes after touching a three-month low.

On Thursday, the 30-year US Treasury yield slipped 1 basis point to 5.18%, extending the previous session's 9-basis-point decline, while the benchmark 10-year yield also moved roughly 1 basis point lower to 4.63% after a cumulative 6-basis-point drop the day before. A Bloomberg index tracking US government bonds with maturities of 20 years or longer posted a 1.7% single-day gain on Wednesday, its biggest advance since February 2025. This momentum spilled over into Japan, Australia, and New Zealand, where bond prices rose in tandem.

SK Hynix and Samsung Electronics have sequentially unveiled massive shareholder return programs totaling a combined 140 trillion Korean won, directly igniting the Korean stock market. The MSCI Asia Pacific equity index climbed 1.6%, snapping a two-day losing streak. South Korea's Kospi index led gains across the region, surging between 5.5% and 5.9%, with SK Hynix jumping 12% on its share buyback announcement and Samsung Electronics advancing 8.5%. Japan's Nikkei 225 closed 1.4% higher at 66,216.79 points, while Seoul's composite index finished up 5.9% at 6,852.58 points.

Jack McIntyre, portfolio manager at Brandywine Global Investment Management, commented: "This administration needs a win, perhaps achieved precisely through artificially suppressing long-end Treasury yields. The pessimism in the global long-end market is unlike anything I've seen in a long time; they had to act."

Europe's Stoxx 50 opened flat, Germany's DAX slipped 0.3%, the UK's FTSE 100 edged up 0.1%, and France's CAC 40 gained 0.1%.

The Nikkei 225 closed up 1.4% at 66,216.79 points, and Seoul's Kospi ended 5.9% higher at 6,852.58 points.

The 30-year US Treasury yield fell 1 basis point to 5.18%, building on Wednesday's 9-basis-point drop, and the benchmark 10-year yield similarly dipped about 1 basis point to 4.63%.

Japan's 10-year yield declined 6 basis points to 2.835%.

The dollar index edged up 0.1% during Asian trading hours after dropping 0.8% the prior day to its lowest level since May.

The euro rose 0.1% against the dollar to 1.1687, its strongest level since May 14.

Brent crude advanced 0.4% to approximately $92 per barrel.

Gold slipped 0.8% to around $4,480 per ounce.

Bitcoin climbed above $69,300.

Buyback Scale at Least Doubled; Treasury Targets Long-End Rates

The US Treasury has announced it will at least double the scale of its long-dated debt buyback program. The move is aimed at suppressing long-end Treasury yields, which have recently climbed to multi-decade highs.

Earlier this week, long-dated US Treasury yields surged sharply. The 30-year yield touched its highest level since 2007, while last week's 10-year auction cleared at the richest funding cost since 2007, and the 30-year auction's resulting yield marked a fresh high not seen since 2001.

Market participants have drawn comparisons between this buyback operation and the Federal Reserve's "Operation Twist." The Treasury has not specified the funding source for the buybacks, though it typically relies on short-term bills to meet variable funding needs. If authorities are effectively replacing long-term bonds with short-term paper, the mechanics bear a striking resemblance to Operation Twist.

Jack McIntyre of Brandywine Global Investment Management remarked: "This administration needs a win, perhaps achieved precisely through artificially suppressing long-end Treasury yields. The pessimism in the global long-end market is unlike anything I've seen in a long time; they had to act."

Market Skepticism Over Buyback Efficacy; Dollar Narrative Shifts Quietly

Despite the clear short-term improvement in sentiment, several analysts remain cautious about the sustainability of the buyback policy's impact.

Gerald Gan, chief investment officer at Reed Capital, stated: "The buyback program convinces me the US Treasury is deeply worried about long-term borrowing costs. But like currency intervention in the yen, the effect is temporary; buybacks cannot last indefinitely."

In the foreign exchange market, the Bloomberg Dollar Index edged up 0.1% during Asian trading after sliding 0.8% the previous day to its lowest level since May. The euro gained 0.1% against the dollar to 1.1687, the strongest since May 14.

Lloyd Chan, Singapore-based currency strategist at MUFG Bank, wrote in a research note: "Buybacks alone are unlikely to change longer-term fundamentals, but they do signal that policymakers are inclined to resist further yield increases. This suggests the relative rate logic that previously underpinned the dollar is fading."

Bloomberg market strategist Mark Cranfield also pointed out: "For investors weighing Treasury buybacks against a persistently widening fiscal deficit, the dollar is becoming the weakest link, providing further room for Asian currencies to strengthen."

Root Cause of Bond Rout Remains; Gold and Oil Diverge

The deeper triggers of the current bond market turmoil have not dissipated. Recent global bond market pressure stems from investors demanding higher compensation for inflation risks and rising government debt levels, with Middle East tensions adding to price pressures. Concurrently, a wave of corporate bond issuance to finance the AI boom has amplified the intensity of this selloff.

In commodities, Brent crude rose 0.4% to approximately $92 per barrel. The former president has stated he would wage an "unprecedented economic war" against Iran and accused Tehran of missing an opportunity to reach a deal, with geopolitical risk premiums lending support to oil prices.

Gold, however, pulled back after climbing to its highest level since early June, falling 0.8% to around $4,480 per ounce. Bitcoin advanced above $69,300, following the former president's meeting with cryptocurrency industry executives at the White House, during which he urged Congress to push through related legislation.