EUROPEAN OPEN: ENR GY seeks bids for EUR 10bln industrials unit; SHEL LN shelves Trinidad Aphrodite gas project; AIR FP Spain workers approve strike; EL FP strategy chief to step down; NWG LN plans expansion into US market

EUROPEAN OPEN:

• European equities started Tuesday trade on the front foot; industrials leads, followed by tech, while autos lag. APAC stocks were mixed overnight following a subdued Wall Street handover, where most major indices declined amid tech weakness and pressure from US economic measures on Iran, as well as US-Canada trade tensions.
• Treasury Secretary Bessent launched “Operation Economic Outcast,” sanctioning over 60 entities, individuals and vessels tied to Iranian oil smuggling, nuclear procurement and cyber operations; Iran’s Economy Minister said Tehran is fully prepared, and has a two-year plan to manage the sanctions, reiterated warnings that it would shut all regional oil exports if the war continued, and again told ships not to pass through the Strait of Hormuz without permission.
• Meanwhile, Pakistan said significant progress had been made with Iran in talks focused on preventing further escalation, reopening the Strait of Hormuz and reaching an end to the conflict.
• Crude futures fell as the US measures against Iran offered little clarity on restoring Strait of Hormuz flows, and traders saw limited immediate impact on physical supply from the US economic pressure; Brent fell beneath USD 90/bbl, and WTI fell beneath USD 85/bbl.
• USD edged higher. Into month-end, Barclays’ rebalancing model signals moderate USD selling against all majors. The bank noted August’s summer lull was short-lived, with Brent rising above USD 90/bbl on US-Iran escalation reigniting inflation concerns, while Treasury buyback announcements acknowledged long-end yield pressures without providing lasting relief. US equities gained as markets priced out Fed hike risks, but the USD weakened sharply, pushing Barclays’ dollar sentiment index into bearish territory.
• Gold steadied after a four-day rally, and trades flat as Europe gets underway; bullion briefly neared USD 4,700/oz before slipping. Citigroup raised its three-month gold price target to USD 4,800/oz, saying speculative momentum has further room to run, adding that physical demand will need to strengthen for the rally to continue.
• Bitcoin rose above USD 80K for the first time since mid-May, and has now gained over 20% over the last week as USD weakness revived the debasement trade.
• RBA meeting minutes from its August confab showed the board considered raising the cash rate by 25bps, but ultimately held at 4.35%, with several members judging upside inflation risks could crystallise and require further tightening, while others saw potential downside offsets and sufficient time to assess incoming data.
• BoJ core CPI eased to 2.3% Y/Y in July (prev. 2.6%), but still remaining above the central bank’s 2% target. Traders are pricing approximately 80% probability of a BoJ rate hike on 18th September.
• In data, final German Q2 GDP growth printed 0.3% Q/Q (exp. 0.2%, prev. 0.4%), with the annual rate up at 1.0% Y/Y (exp. 0.9%, prev. 0.7%). Germany’s stats office said the economy’s growth momentum from the start of the year is continuing, with strong export performance the primary driver, as was the case in Q1.
• In the UK, PM Burnham declined to rule out tax rises in the 28th October Budget, saying he would take a careful approach and would not be unrealistic about the challenging state of public finances; Burnham also noted that cost of living measures announced so far have been funded via reprioritised spending, rather than fresh borrowing.

STOCK SPECIFICS:

• FINANCIALS: NatWest (NWG LN) is reportedly planning to expand into the US market, aiming to benefit from looser rules on UK banks’ overseas activities, according to the FT. Proxy advisor ISS confirmed its recommendation for a vote in favour of Intesa’s (ISP IM) capital increase to aide in the acquisition of BMPS (BMPS IM).
• CONSUMER CYCLICAL: Volkswagen (VOW3 GY) CEO Blume and brand chief Schafer are due to present their restructuring plan to workers at the Wolfsburg factory; the plan could eliminate as many as 100,000 jobs. The IG Metall chief Benner has already said the cost-cutting targets and margin goal of 9% as unrealistic, and some union members have warned of potential strikes if Blume does not walk back his plans.
• ENERGY: Shell (SHEL LN) shelved its Aphrodite offshore gas project in Trinidad and Tobago after failing to agree sales terms with the National Gas Company; Shell released the contracted jack-up rig, but continues evaluating the integrated project schedule.
• INDUSTRIALS: Siemens Energy is working with Goldman Sachs (GS) to seek offers for a majority stake in its Transformation of Industry division; the unit could be valued above EUR 10bln; CVC Capital, EQT, Bain, Brookfield and KKR are exploring bids, with the board due to decide how to proceed today. Workers at Airbus (AIR FP) Spain voted by a large majority to proceed with an indefinite strike from Tuesday 25th August, rejecting the company’s latest wage proposal as insufficient. Airbus warned the action could impact production obligations and customer agreements, and added that reaching an agreement in the coming days was critical.
• HEALTHCARE: Leonardo Maria Del Vecchio will step down as Ray-Ban chairman and EssilorLuxottica (EL FP) chief strategy officer, effective 31st August, according to MF-Milano Finanza; he criticised CEO Francesco Milleri’s management style as distant and impersonal. Gerresheimer (GXI GY) said interim CEO Rohrhoff will step down; CFO Wolf Lehmann and management board member Achim Schalk will assume his duties until further notice.
• TECH: SAP (SAP GY) has extended the contract of one of its senior HR members, after clearing her of faults following several complaints made by other employees.
• NOTABLE BROKER UPDATES: Drax (DRX LN) upgraded at UBS; Next (NXT LN) upgraded at Citi; Air France (AF FP) upgraded at Kepler Cheuvreux; Yara (YAR NO) upgraded at Arctic Securities.

DAY AHEAD:

• EVENTS: Canadian ministers are to unveil Canada’s reply to US tariffs on Tuesday at 16:00BST/11:00EDT.
• DATA: In Europe, Germany August Ifo is expected to see the business climate at 87.2 (prev. 86.6), expectations at 87.5 (prev. 86.7) and current conditions at 87.0 (prev. 86.5). In North America, Conference Board consumer confidence (prev. 90.8) and new home sales (prev. 0.628mln; prev. 1.6% M/M) are due, as well as the S&P/Case-Shiller home prices (prev. 1.6% Y/Y) and FHFA house price index (prev. 2.2% Y/Y). Elsewhere, the Richmond Fed manufacturing index (prev. 5); final building permits data (exp. 1.443mln, prev. 1.374mln), and weekly ADP jobs figures (prev. 9.5K) are due to be published.
• CENTRAL BANKS: Riksbank releases August meeting minutes; Fed publishes discount rate minutes. Hungary’s central bank is expected to lower rates by 25bps, to 5.5%, which would be its third consecutive cut.
• SUPPLY: US sells USD 69bln of 2-year notes; UK auctions GBP 4bln of 2033 debt; Germany auctions EUR 5bln of 2028 Schatz.
• ENERGY: Brent October 2026 options expire; weekly private energy inventory estimates due after the US close.
• EARNINGS: Notable corporate earnings reports due today include: Intuit (INTU), Zoom Communications (ZM), Dick's Sporting Goods (DKS).