EUROPEAN OPEN: AV/ LN beats H1 profit expectations; VOW3 GY plans to cut 8TRA GY stake; AAL LN unit signs yearlong iron ore supply deal; BP/ LN awarded Venezuela Loran Phase 2 licence; FER SM plans Euronext Amsterdam delisting

EUROPEAN OPEN:

• European equities have started Friday trade flat/higher. On the week, futures of the Euro Stoxx 50 are on course for a fourth week of gains, while futures of the broader Stoxx 600 are on course for small weekly losses following a four week run of gains.
• Global stocks are headed for a third straight weekly gain as investors returned to AI-linked shares and cooling US inflation reduced expectations of Fed rate hikes. MSCI’s Asia Pacific benchmark rose 0.3%, while the All Country World Index was on track for its longest weekly winning streak since April after closing at a record high. Asian memory chip stocks rose after SanDisk’s bullish long-term outlook boosted confidence in AI-driven demand; Kioxia, SK Hynix, Nanya Technology and Advantest were all up sharply following the update.
• Overnight, the PBoC injected CNY 349bln via overnight reverse repos, leaving a net CNY 348bln liquidity addition, marking its first mid-month use of the tool; analysts said the move was a tactical liquidity adjustment rather than a policy shift.
• The BoJ could raise interest rates as soon as September and may accelerate tightening beyond its roughly twice-yearly pace, sources told Reuters, chiming with other sourced reporting earlier in the week. Policymakers are increasingly concerned about inflation risks from JPY weakness, Middle East pressures and AI-driven demand. Markets are currently pricing almost 80% probability of a September hike, with another increase potentially possible in December.
• Crude ticked higher amid limited progress on reopening the Strait of Hormuz. Brent trades around USD 88/bbl, WTI is above USD 82/bbl. Treasury Secretary Bessent said the US plans to announce unprecedented economic measures against Iran next week as part of intensified financial pressure. The measures will accompany the continued blockade of Iranian ports.
• Gold prices fell towards USD 4,300/oz, down for a second day as profit-taking followed a rally driven by subdued US inflation data and reduced expectations for a Fed rate hike. Bullion enters the European trading day around USD 4,330/oz.
• In trade news, the White House said that the US is applying a 100% tariff on imports of unmanned aircraft systems and their components; the 100% rate will apply to drones of a certain size or those that possess national security capabilities, while other imports will face lower duties.
• In data releases, German wholesale prices rose +0.2% M/M in July (exp. 0.4%), with the annual rate rising to 5.3% Y/Y (prev. 4.9%).
• In UK politics, Nigel Farage retained his Clacton seat with 62.8% of the vote after resigning to trigger a by-election amid scrutiny over GBP 5mln received from crypto investor; Count Binface won 26.7%, while major parties boycotted the contest. Parliamentary inquiries into whether the payment required disclosure can now resume.

STOCK SPECIFICS:

• TECH: Applied Materials’ (AMAT) shares fell 5.1% in extended US trading as lofty investor expectations overshadowed solid quarterly results, an above-consensus outlook, and continued strength in AI-related semiconductor equipment demand.
• FINANCIALS: Aviva (AV/ LN) H1 operating profit GBP 1.33bln (exp. 1.25bln), operating EPS 0.318 (exp. 0.297); Aviva said it remains confident in its three-year targets and sustained longer-term growth.
• CONSUMER CYCLICALS: Ford (F), General Motors (GM) and Stellantis (SLTAM IM) plan to argue proposed USMCA changes could add billions in annual costs and weaken competitiveness; a proposed 50% US-made content threshold and higher North American content requirement could cost each Detroit automaker at least USD 2bln annually. Volkswagen (VOW3 GY) plans to reduce its 87.5% stake in Traton (8TRA GY) to 75% plus one share as part of a broader cost-cutting and asset-sale programme; it previously sold 2.2% of Traton for about EUR 360mln in March 2025. Traton CEO said pressure from Volkswagen to control costs and investments has increased.
• MATERIALS: Producer Kumba Iron Ore, part of Anglo American (AAL LN), has reportedly reached a yearlong deal with CMRG to supply iron ore to its mills. Norsk Hydro (NHY NO) said Alunorte reached a temporary agreement with gas supplier CELBA on terminal access and has begun increasing alumina production; the refinery had previously reduced output temporarily due to disruptions in natural gas availability.
• ENERGY: BP (BP/ LN) announced that it has been awarded an exploration and production licence for Phase 2 of the Loran field in the Plataforma Deltana area in Venezuela.
• INDUSTRIALS: Ferrovial (FER SM) plans to delist from Euronext Amsterdam in September, with the last trading day expected on 10th September; it will remain listed on the Nasdaq and Spanish Stock Exchanges.
• HEALTHCARE: Valneva (VLA FP) and Pfizer (PFE) announced that the EMA has validated the Marketing Authorisation Application for PF-07307405, the companies’ 6-valent OspA-based Lyme disease vaccine candidate and will begin its assessment of the application.
• NOTABLE BROKER UPDATES: Maersk (MAERSKB DC) upgraded at Nordea. Valmet (VALMT FH) downgraded at SEB.

DAY AHEAD:

• EVENTS: US President Trump will deliver remarks from New York at 15:00EDT/20:00BST.
• DATA: In Europe, Eurozone Q2 GDP second estimate is expected to print 1.0% Y/Y (prev. 0.5%), with the quarterly figure seen rising 0.4% Q/Q (prev. 0.0%). The Eurozone June trade balance is also due, expected at EUR 5bln (prev. EUR -7.8bln), and the EZ employment change prelim data for Q2 is seen +0.1% Q/Q. In North America, US July retail sales are expected to see the headline rise by 0.1% M/M (prev. 0.2%), with the core measure at 0.2% M/M (prev. -0.2%), and the control group at 0.3% M/M (prev. 0.5%). US will also release prelim University of Michigan consumer sentiment, with the headline seen easing to 54.5 (prev. 55.2), current conditions at 55.0 (prev. 54.8), expectations at 55.2 (prev. 55.4); 1yr inflation expectations are seen easing to 4.1% (from 4.2%), while 5-10yr expectations are seen easing to 3.2% (prev. 3.3%). After today’s data, the Atlanta Fed will update its GDPNow Q3 tracking model (it was previously tracking growth of 5.8%). In Canada, wholesale sales final are seen rising 2.7% M/M (prev. 0%) and final manufacturing sales are seen declining by -0.1% M/M (prev. 1.3%).
• ENERGY: Baker Hughes will report its weekly rig count data (prev. oil 454, gas 124, total 588).
• CRA: Fitch reviews the UK (AA).
• PRIMER - US RETAIL SALES (13:30BST/08:30EDT): The consensus expects US retail sales to rise by 0.1% M/M in July (prev. 0.2%), the core measure rising 0.2% M/M (prev. -0.2%), and the control group rising 0.3% M/M (prev. 0.5%). The Chicago Fed’s July advance retail trade summary sees retail and food services sales ex. autos rising +0.1% M/M seasonally adjusted, and unchanged when adjusted for inflation. BofA’s consumer checkpoint data for the month showed total card spending growth easing to 5.0% Y/Y (prev. 6.3% in June), but the bank said that much of the moderation appears tied to the fading of temporary boosts, like the timing of online promotions, and World Cup-related spending, rather than a broad deterioration in underlying demand. “Against this backdrop, consumer financial health looks solid,” BofA writes, “despite cost-of-living pressures from areas such as gasoline, the share of households paying off their credit card bills in full each month has risen,” adding that “there is little sign of an acceleration in households drawing upon their savings.”