Newsquawk Daily US Opening News - 31st August 2026

• The US attacked two missile launchers of the IRGC on Larak Island on Sunday, which were said to be on standby to launch missiles with sea mines toward the Strait of Hormuz.
• Iran's Revolutionary Guards later announced that they retaliated with missiles and drones against two US bases in Jordan and warned that any attack against them will be met with a more devastating response.
• US equity futures trade muted, with focus on the jobs report on Friday.
• DXY is weaker against all G10 peers heading into month-end.
• Fixed income benchmarks are contained on the UK Bank Holiday.
• Energy benchmarks gapped higher as the US and Iran exchange strikes.
• Looking ahead, highlights include German Inflation Flash (Aug) and Supply from the EU.

SNAPSHOT

STOCKS
Euro Stoxx 50	-0.2%	DAX40	-0.7%
Stoxx 600	-0.1%	FTSE 100	Closed
ES Sep'26	-0.1%	RTY Sep'26	+0.1%
NQ Sep'26	U/C	YM Sep'26	-0.1%

FX
DXY	-0.1% (99.54)	EUR/USD	+0.2% (1.1600)
USD/JPY	-0.2% (159.71)	GBP/USD	+0.1% (1.3543)

BONDS
US T-Note Sep'26	+2 ticks	Bund Sep'26	-15 ticks
US 10yr Yield	4.712%	German 10yr Yield	3.294%

ENERGY & METALS
WTI Oct'26	+3.5%	Brent Nov'26	+3.5%
Spot Gold	-0.3%	LME Copper	U/C

CRYPTO
Bitcoin	+1.3%	Ethereum	+1.2%

As of 10:20BST / 05:20EDT

IRAN CONFLICT

WEEKEND GEOPOLITICAL UPDATES

• US attacked two missile launchers of the IRGC on Larak Island on Sunday, which were said to be on standby to launch missiles with sea mines toward the Strait of Hormuz, while there were later reports of explosions heard near Larak Island.
• US Central Command said IRGC claims of US aggression in the Strait of Hormuz are false, but added the US conducted limited precise action against IRGC minelaying forces that posed an imminent threat in the Strait of Hormuz.
• Iran’s Revolutionary Guards warned the US strike on Larak Island would be met with a response and punishment, while it said several soldiers and civilians were killed and wounded in the assault.
• Iran's Revolutionary Guards later announced that they retaliated with missiles and drones against two US bases in Jordan and warned that any attack against them will be met with a more devastating response, although a US official cited by Fox News stated no major damage in Iranian attacks on US forces in Jordan and that all missiles were intercepted.
• Iran's Press TV noted reports of Iran firing missiles towards US vessels in the Strait of Hormuz, and there were reports of explosions heard in the UAE and in Qatar, while Iran's army later said it launched tens of drones at the Al Minhad air base in the UAE.
• IRGC said a supertanker caught fire and was halted after being struck by two naval mines in the Strait of Hormuz, while it added that the tanker was attempting to pass illegally through the Strait of Hormuz and that ships must comply with its rules for passage. IRGC separately announced that it shot down a US MQ-9 drone over the Strait of Hormuz.
• Iran's Foreign Ministry said it will respond decisively to any further enemy military aggression, and stated that the US and parties supporting its military actions bear full responsibility for consequences of escalation.
• US President Trump reiterated in a pre-recorded Fox News interview that Iran cannot have a nuclear weapon and said the Iran blockade has been unbelievable, while he also commented that the US had to intervene in the Middle East to prevent Iran from using a nuclear weapon against Israel and other countries in the region and possibly against the US.
• US President Trump posted a generated video with the caption "Kharg Island being blown to smithereens!!!"
• US Treasury Secretary Bessent said the US Treasury plans to impose more Iran secondary sanctions every week, starting with banks. He also stated that they are telling banks it's not okay to have Iranian money and to aid the Iranian regime, and they will probably just sanction a bank outright next time, after the US imposed curbs on an Egyptian bank's United Arab Emirates branches.
• Iranian President Pezeshkian said they are not looking for war, but will give a decisive response to the aggressors, while he added that instability and unrest in the region are not in the interest of any countries and will create challenges for everyone.
• Iran's President said on Friday that Iran is ready for cooperation and understanding with regional countries, including Saudi Arabia and the UAE, while it is to open its route if four commitments are met. He also stated that Iran is to increase gasoline prices, and that exports and imports have decreased by up to 35% because of US sanctions and the blockade.

NOTABLE EUROPEAN UPDATES

• US officials said they are monitoring the Strait of Hormuz and will strike any forces that threaten navigation in the waterway, Al Arabiya reported.
• Iran's IRGC Navy said compliance with regulations issued for the Strait of Hormuz is mandatory and warned against being “misled” by the US, Press TV reported.
• Yemeni armed forces reportedly targeted Saudi ships in the Red Sea, ISNA reported citing Yemeni media reports.
• UAE Ministry of Defense denied reports that Al Minhad Air Base was targeted by missiles, calling the claims unfounded and saying it remains on high alert and fully prepared to respond to any threats.
• Iranian oil operations are continuing on Kharg Island, and the oil sector there has not stopped, Al Hadath reported.

EUROPEAN TRADE

EQUITIES

• European bourses are mixed to start the week, with Italy's FTSE MIB outperforming while Germany's DAX 40 lags. To note, UK markets are closed today for a Summer Bank Holiday. Little in terms of newsflow; however, the US and Iran exchanged strikes for the first time in around a month at the weekend, with the US targeting Larak Island while Iran struck two US bases in Jordan.
• Overnight, South Korea's KOSPI gapped lower and traded with losses as much as 3.6%, before reversing and closing with gains of 0.5%. Samsung Securities' Roy Lim explains this reversal by pointing to notable buying by pension funds, primarily in tech names. Lim said pensions bought KRW 120bln worth of shares over a 20-minute period heading into the close.
• Sectors are mixed. Chemicals top the sector pile, with Autos and Energy completing the sector outperformers. Tech is the laggard, with worries that the Fed hiking rates will drag yields higher and, in turn, weigh on tech. Real Estate and Industrials round out the sector laggards.
• US equity futures are muted with a slight negative tilt. A typical quiet start of the week, with an important jobs report awaiting markets on Friday.
• Click for the sessions European pre-market equity newsflow
• Click for the additional news

FX

• Some USD weakness emerged this morning with DXY falling to a base around 99.50 which is the 50% Fibonacci retracement of the 99.19-99.72 rally seen after Warsh’s speech. Sell side commentary viewed the speech as hawkish, but Morgan Stanley said it was “not convinced it means hikes are coming” while GS said nothing is yet baked in and with focus on incoming data. Some also note algos reacted to Warsh’s use of “hike” within the context of “hikes on the trails”, in his use of a Kohn/Bernanke analogy. Note, month end may be playing a part in some of the moves seen this morning, where Barclays sees moderate USD selling.
• Action elsewhere paints the picture of the weaker USD, with all majors firmer vs. the Buck.
• JPY leads with earlier, modest losses accelerated around 160.00 where it fell to a 159.74 base. Data overnight showed better-than-expected Japanese Industrial Production and Retail Sales data, though nothing which moved JPY at the time.
• EUR keeps focus on French politics where PM Lecornu’s preview of the 2027 budget ruled out tax increases and de-indexing small pensions. In terms of the 2027 presidential election, an Elabe poll showed Le Pen victorious in every run-off tested, while Philippe (centre) currently appears best placed to challenge, polling at around 47.5%. On the left is Mélenchon, whose odds have ticked lower in recent days, perhaps a welcome development to EUR and EGBs. For now, EUR within a thin 1.1578-1.1606 with UK participants away on Bank holiday. To remind, Barclays sees moderate EUR buying vs USD.

FIXED INCOME

• A contained start to the week for fixed income. The European morning has been particularly quiet, owing to the fact that the UK is away on Bank Holiday. USTs are currently firmer by a few ticks, in 108-01 to 108-09 parameters; note, the initial low went below last week’s trough by half a tick, and any resumption of the move looks to 107-31+ from the last week of July.
• Overnight, USTs, JGBs and Bunds were all in relatively narrow ranges and ultimately didn't significantly differ from the unchanged mark. Broadly speaking, the main focus was the weekend’s geopolitical updates and particularly US action on Larak Island and then Iranian retaliation.
• Geopolitics aside, desks remain focused on the speech by Fed Chair Warsh last week, which had a hawkish skew and has contributed to the implied probability of a September 25bps hike increasing to just under 60% currently via CME, vs around 41% one week ago.
• Bunds reside in the red by a few ticks. Nonetheless, the benchmark holds at the upper-end of 123.43-60 parameters. No move to the German State CPIs, which saw the Y/Y tick up modestly from the prior, in-fitting with consensus for the 13:00BST mainland figure. On Tuesday, we get the Flash EZ HICP series, and given what we have seen so far the energy component may be the most pertinent.

COMMODITIES

• Over the weekend, tensions between the US and Iran escalated after US forces struck IRGC missile and minelaying capabilities on Larak Island, prompting Iran to retaliate with missile and drone attacks against US and regional military targets. Further, Iran reported striking a tanker with mines, downing a US drone and targeting US vessels, while both sides exchanged warnings of further retaliation. President Trump reiterated that Iran cannot obtain nuclear weapons, while Washington is also intensifying economic pressure through additional sanctions. Despite the escalation, Iranian leaders said they do not seek war and remain open to regional cooperation, whilst also warning of a decisive response to further attacks.
• WTI Oct and Brent Nov futures gapped higher at the open after the US and Iran resumed strikes for the first time in over a month. The contracts are firmer by over 3%, with USD 84.11-86.53/bbl and USD 89.03-91.38/bbl ranges respectively. Dutch TTF surged by some 4% intraday and tested EUR 70/MWh this morning. “Tight supply entering the heating season leaves the market vulnerable to spikes higher later in the year”, ING says.
• Metals are flat/mixed with the complex somewhat cushioned by the softer USD despite the backdrop of higher energy prices. Spot gold moves closer to its 100 DMA to the downside (USD 4,370/oz) after dipping under Friday’s low (4,445/oz) to trade in a current USD 4,396-4,472/oz range. 3M LME copper trades in a narrow USD 14,223.68- 14,388.55/t.

TRADE/TARIFFS

• US Treasury Secretary Bessent said the G20 should re-examine trade terms with China and current exports from China are unsustainable, adding the world cannot have China with a USD 1.2tln trade surplus.

NOTABLE EUROPEAN HEADLINES

• S&P affirmed Portugal A+; Outlook Positive, citing resilient economic growth, while Fitch affirmed France at A+; Outlook Stable.

NOTABLE EUROPEAN DATA RECAP

• German North Rhine Westphalia CPI (Aug MM) 0.2% (Prev. 0.9%).
• German North Rhine Westphalia CPI (Aug YY) 2.9% (Prev. 2.7%).

CENTRAL BANKS

• Riksbank Deputy Governor Jansson said Sweden’s inflation outlook has become more uncertain after unexpectedly high inflation readings this summer but the Riksbank's have scope to wait before adjusting monetary policy, even if there are some risks of elevated inflation going forward. Jansoon added that Sweden’s economic recovery could prove more persistent than expected but does not currently see signs that Sweden’s economy is at risk of overheating soon.
• New Zealand NZIER Shadow Board recommended the RBNZ hike the OCR by 25bps to 2.75% at its meeting this week.

NOTABLE US HEADLINES

• A bipartisan US bill would permanently ban Chinese internet-connected vehicles, and target Chinese software and hardware in US autos, NYT reported.

GEOPOLITICS

RUSSIA-UKRAINE

• The EU is to unveil "one of the biggest" Russia sanctions list in retaliation of hybrid threats, with the package to come alongside bilateral measures being prepared by Berlin, POLITICO reported citing sources.
• Ukrainian President Zelensky is to send top sanctions adviser to Capitol Hill this week in a bid to convince House lawmakers to drop their opposition to the Senate-passed Russia sanctions bill, Punchbowl reported.

CRYPTO

• Bitcoin trades at the top end of its USD 77.37k-78.50k range as the cryptocoin holds onto the recent surge.

APAC TRADE

• APAC stocks were mostly lower heading into month-end and after recent hawkish comments from Fed Chair Warsh at Jackson Hole, while tensions in the Middle East escalated over the weekend after the US and Iran resumed strikes for the first time in over a month.
• ASX 200 saw mixed price action and was initially kept afloat amid strength in the top-weighted financials sector and with gains also seen in energy, utility and consumer industries, although upside was limited and eventually reversed following disappointing Private Sector Credit and Company Profits data.
• Nikkei 225 gapped lower at the open to below the 66,000 level, although it was off today's worst levels as participants also reflected on stronger-than-expected Japanese Industrial Production and Retail Sales data.
• KOSPI retreated amid weakness in its tech heavyweights and with a report noting that day traders are abandoning Korean chip leveraged ETFs in large numbers, with leveraged ETFs targeting twice the daily returns of chipmakers Samsung Electronics and SK Hynix, on course for their first monthly outflow.
• Hang Seng and Shanghai Comp were subdued, with risk appetite not helped by the latest official PMI data, in which headline Manufacturing topped forecasts, but Non-Manufacturing disappointed and both remained in contraction territory.

NOTABLE ASIA-PAC HEADLINES

• Japanese government is to request JPY 143tln for the budget (general account) in FY27, Nikkei reported citing sources.
• South Korean President Lee nominated Lee Hyoung-il as the new finance minister and Kang Shin-chul as defence minister.
• China’s MOFCOM targets around CNY 60tln in total retail sales of consumer goods by 2030.
• New Zealand government cancelled fuel tax hike planned for next year.

NOTABLE APAC DATA RECAP

• Chinese NBS Manufacturing PMI (Aug) 49.8 vs. Exp. 49.7 (Prev. 49.2).
• Chinese NBS Non Manufacturing PMI (Aug) 49.0 vs. Exp. 49.5 (Prev. 49.0).
• Chinese NBS General PMI (Aug) 49.5 (Prev. 49.3).
• Japanese Industrial Production Prel (Jul MM) 0.1% vs. Exp. -0.6% (Prev. 1.9%).
• Japanese Industrial Production Prel (Jul YY) 4.1% (Prev. 4.9%).