- US stocks finished mixed with the Nasdaq kept afloat by tech outperformance and the small-cap Russell 2000 tumbled, while the majority of sectors took a hit and price action for the major indices was rangebound amid a lack of catalysts, lingering geopolitical risks and ahead of key data.
- USD traded rangebound amid a lack of catalysts ahead of upcoming data releases including US PPI on Tuesday, CPI on Wednesday and Retail Sales on Thursday, while NY Fed SCE showed 1-year and 5-year inflation expectations were unchanged from the previous but the 3-year view fell.
- Looking ahead, highlights include Japanese PPI, Singapore GDP, Australian Westpac Consumer Sentiment, NAB Business Survey & Wage Price Index.
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LOOKING AHEAD
- Highlights include Japanese PPI, Singapore GDP, Australian Westpac Consumer Sentiment, NAB Business Survey & Wage Price Index.
- Click for the Newsquawk Week Ahead.
US TRADE
- US stocks finished mixed with the Nasdaq kept afloat by tech outperformance and the small-cap Russell 2000 tumbled, while the majority of sectors took a hit and price action for the major indices was rangebound amid a lack of catalysts, lingering geopolitical risks and ahead of key data.
- SPX flat at 5,344, NDX +0.16% at 18,542, DJIA -0.36% at 39,357, RUT -0.91% at 2,062.
- Click here for a detailed summary.
NOTABLE HEADLINES
- White House official said US President Biden would sign a proposal to bar tax on tips.
DATA RECAP
- NY Fed SCE (Jul.) 1yr inflation expectations 3.0% (prev. 3.0%), 3yr 2.3% (prev. 2.9%), 5yr 2.8% (prev. 2.8%)
- Cleveland Fed Survey of Firms' Inflation Expectations (Jul): 1yr ahead 3.4% (prev. 3.8%)
FX
- USD traded rangebound amid a lack of catalysts ahead of upcoming data releases including US PPI on Tuesday, CPI on Wednesday and Retail Sales on Thursday, while NY Fed SCE showed 1-year and 5-year inflation expectations were unchanged from the previous but the 3-year view fell.
- EUR eked marginal gains against the dollar but with price action kept within a tight range at the 1.0900 territory.
- GBP was ultimately flat after a choppy session for GBP/USD with intraday advances thwarted by resistance just shy of 1.2800.
- JPY weakened but is well off intraday lows after USD/JPY pulled back from a brief return to the 148.00 handle.
FIXED INCOME
- T-notes were underpinned amid the heightened geopolitical risks and as focus turns to upcoming key US data.
COMMODITIES
- Oil prices were firmer to start the week amid geopolitical uncertainty with Israel on the highest state of alert, while a recent CNN report noted Iran could attack Israel in less than 24 hours although IDF radio had previously reported that the final decision on the direct attack has not yet been made and if carried out, will be limited and will not lead to a wide regional war.
- OPEC MOMR (August) noted demand growth for 2024 was revised lower by 135k BPD to 2.1mln bbls and the 2025 forecast was revised lower by 65k BPD to about 1.8mln BPD.
- US Department of Energy said the US seeks to buy 6mln bbls of oil to help replenish the SPR.
GEOPOLITICAL
MIDDLE EAST
- Iran could reportedly attack Israel in less than 24 hours, according to Fox citing sources.
- Iran has made significant deployment steps in its missiles and drone systems, similar to those it took before the attack on Israel in April, according to Israeli and US officials cited by Axios's Ravid.
- Israeli Military said they are at the highest state of alert. It was also reported that the Israeli Air Force commander prevented pilots from leaving Israel immediately in preparation for an Iranian response, according to Bloomberg.
- IDF radio said the final decision on the direct attack has not yet been made and is in the hands of the Iranian leader, while it was added that the Iranian attack if carried out, will be limited and will not lead to a wide regional war, according to Asharq News.
- White House's Kirby said the timing of Iran's attack on Israel could be this week and have to be prepared for what could be significant attacks.
- US State Department said they fully expect the Gaza peace talks to move forward as planned and believes a ceasefire agreement is still possible, while it was also reported that President Biden and European leaders discussed a Gaza hostage release.
OTHER
- Ukraine's Army Chief said roughly 1,000 square km in Kursk region is under Ukraine's control. It was also reported that a governor alleged Ukrainian forces used chemical weapons in Russia's Kursk region, according to RIA.
- Russian forces took control of the settlement of Lyscychne in Ukraine, according to RIA.
ASIA-PAC
NOTABLE HEADLINES
- US-China working group set to meet in China this week for discussions about financial stability and curbing the flow of fentanyl with talks to take place on Thursday and Friday, according to New York Times.
- Hong Kong chip fab which is being led by a Chinese scientist who worked on developing photonic technology for the US military raises US research security concerns, according to a report cited by Nikkei.
DATA RECAP
- Indian CPI Inflation YY (Jul) 3.54% vs. Exp. 3.65% (Prev. 5.08%)
- Indian Industrial Output YY (Jun) 4.2% vs. Exp. 5.5% (Prev. 5.9%)
EU/UK
DATA RECAP
- German Wholesale Price Index MM (Jul) 0.3% (Prev. -0.3%)
- German Wholesale Price Index YY (Jul) -0.1% (Prev. -0.6%)
