Market Moment
The week closed green even as bonds burned. On Friday the S&P 500 rose 0.51% to 7,743, the Nasdaq gained 0.5% to 27,069 and the Dow Jones added 0.93% to 51,829. All three indices finished the week higher.
The US 10-year Treasury yield closed at 5.18%. Intraday it briefly neared its highest level since 2007 before easing into the close. Equities shrugged off the rate shock all week.
Oil fell on Iran’s offer. WTI dropped 2.33% to $92.41 a barrel, Brent 2.14% to $104.32. The market priced in hope that the Strait of Hormuz could reopen within a week.
Gold rose 0.46% to $4,285 an ounce, but still ended the week lower as rising yields capped the rally. The dollar index slipped about 0.3% on Friday from its weekly high, while bitcoin is holding near $84,000 on Saturday.
Lithuania and the Baltics
Prime Minister Mindaugas Sinkevičius told banks to prepare for payments during mobilization. Card payments must work for medicines and fuel even without a bank connection, and ATMs are to receive guaranteed power and cash supply in a crisis. The figures released alongside show an overheating credit market: the mortgage portfolio is growing 14.9% a year, the fastest since March 2009, and household deposits hit a record €30.8 billion in July.
Border municipalities openly admit evacuation gaps during the “Vyčio skliautas 2026” exercise. Šalčininkai district would lack transport if it had to evacuate within 24 hours. Jurbarkas district may need to move up to 5,700 residents, roughly a quarter of its population, including 130 patients needing special vehicles. Practical drills begin on Saturday.
Lithuania submitted its seventh and final Recovery and Resilience Facility (RRF) payment request to the European Commission, for €1.1 billion. About €992.8 million is expected by the end of December; over five years Lithuania will receive nearly €4 billion from the fund.
Transport Minister Juras Taminskas says an airBaltic bankruptcy would not be a tragedy for Lithuania. The Latvian carrier is cutting routes and has cancelled its share offering, and its collapse would effectively shut down Riga airport as the regional hub.
Speaker of the Seimas Juozas Olekas’s proposal to extend judges’ tenure from 65 to 70 caught the judiciary by surprise, says Judicial Council chair Danguolė Bublienė. Of 510 judges surveyed, only 121 said they would actually work longer.
Europe
From November 1 the European Commission introduces a €2 handling fee on every imported parcel ordered online. Platforms such as Temu, Shein and AliExpress will pay it. Last year about 6 billion such parcels entered the EU, 90% of them from China.
The US Justice Department sided with Elon Musk in his case against the EU. It backs X’s challenge at the EU General Court against a €120 million fine under the Digital Services Act. The Commission said on Friday it will defend the fine. Together with the proposed diesel export ban, this is Washington’s second pressure front on Brussels in a week.
Ukraine
Kyiv has been under near-continuous attack for a second day. Friday’s strikes on the capital killed seven people, injured 58 and halted production at ArcelorMittal, Ukraine’s largest steelmaker. Overnight into Saturday Russia launched 173 Shahed-type drones, 50 of them jet-powered. Steel accounts for about 15% of Ukraine’s exports.
A Ukrainian strike halted the Perm oil refinery, Russia’s seventh-largest by capacity. The Novoshakhtinsk refinery also stopped temporarily, and fires broke out at two industrial sites in Krasnodar region.
Diplomacy is standing still. Zelensky says he is waiting for a US proposal on the date of trilateral talks in the United Arab Emirates. Sergei Lavrov accuses Europe of obstructing peace and insists Moscow will achieve its military objectives.
Geopolitics
Iran offered to reopen Hormuz within seven days. Foreign Minister Abbas Araghchi presented in New York a plan built on the June 17 Islamabad memorandum, which collapsed in early July. The conditions: the US lifts its naval blockade of Iranian ports, waives sanctions on oil sales and observes a ceasefire that includes Lebanon. The strait would reopen on day six, nuclear talks would start on day seven.
At the same time Tehran is threatening its neighbours. The US imposed secondary sanctions on airports serving Iranian airlines, and the carriers cancelled international flights. Mohammad Mokhber, an adviser to the Supreme Leader, warned that if Iran is denied the right to fly, no one in the region will fly. In Iraq, the airports of Najaf, Erbil and Sulaimaniya have already restricted Iranian flights.
United Russia won a record 349 of 450 seats in Russia’s State Duma. This was the first wartime parliamentary election, genuine opposition was kept off the ballot, and 46 seats went to veterans of the war in Ukraine.
Trump calls Xi Jinping’s visit “very positive for both countries,” yet no concrete figures were announced. Of the promised 200 Boeing jets, roughly 140 are in “good state” in negotiations, and China is behind on its farm purchases.
What to Watch Tomorrow
The US response to Iran’s seven-day plan. Tehran gave four to five days. If Washington responds positively, Brent could drop below $100; if it refuses, oil will return to its weekly highs.
Futures opening on Sunday evening. After a week in which the 10-year yield approached its 2007 high, it will show whether the bond sell-off continues.
September 30 PCE data. This is the Fed’s key inflation gauge and will decide whether rates rise again in October for a second meeting in a row.
Results of the “Vyčio skliautas” evacuation drills in border municipalities. The drills will show whether the transport shortage is a paper problem or a real one.
The date of trilateral talks in the UAE. Until the US announces it, the diplomatic track exists only in words.
Meška’s Comment
On the same day the prime minister tells banks to prepare for mobilization, municipalities count buses for evacuation, and mortgages grow at the fastest pace since 2009. Confidence? No, these are two different clocks: the state is preparing for a crisis, while households borrow as if there will be none.
The same logic holds globally. Iran offers to reopen the strait while threatening to close the skies to its neighbours, and Washington pressures Brussels over both diesel and Musk. When a hegemon weakens, it does not retreat; it raises the price for everyone who depends on it, and the periphery feels it first through energy and interest rates.