Newsquawk Daily US Opening News - 6th October 2026

• US President Trump signed an order to waive off-road requirements to allow anyone to purchase tax-free red-dyed diesel.
• French RN leader Le Pen said France could face a default if President Macron policy continues, while announcing a French deficit target of 3%of GDP by 2032 at the latest.
• Global equities bid as energy benchmarks fall throughout the European morning (Brent -2.0%).
• DXY near the 102.00 handle; EUR pares back Monday's losses as EGBs rebound.
• Fixed income benchmarks climb; JGBs helped by a strong 10-year auction and hawkish BoJ sources.
• Looking ahead, highlights include US ADP Employment Change Weekly, Atlanta Fed GDP (Q3), EIA STEO. Speakers include ECB's Zigman, Elderson & Cipollone, Fed's Williams, Bowman & Schmid. Supply from the US.

As of 11:05BST / 06:05EDT

EQUITIES

• European bourses (STOXX 600 +1.0%) are firmer across the board, helped by the recent downside across the energy complex. France's CAC 40 was little-moved following comments from Presidential frontrunner Le Pen, who outlined her party’s alternative budget. It was potentially regarded as optimistic by the market, but ultimately enough to appease traders, who continued to take French bonds higher.
• Sectors highlight the positive bias, with all sectors in the green. Health Care is the sector outperformer, following a Genmab update (see more below), while Media and Banks follow closely behind.
• US equity futures are higher, following their European counterparts. An interesting story from Bloomberg, related to the Toshiba-Seagate competition in the memory space, stating that the two Cos are fighting to acquire TDK's HDD magnetic heads business. Elsewhere, AMD CEO commented that demand is exceeding supply, memory remains supply constrained and AMD will substantially increase supply in 2027.
• Click for the sessions European pre-market equity newsflow
• Click for the additional news

FX

• G10s are mixed against the flat USD this morning. EUR and GBP sit towards the top of the pile, but post only modest gains; the single currency moves higher in tandem with OATs. Typical haven currencies such as the CHF and JPY are pressured amidst today’s pullback in yields.
• DXY is currently holding just above the 102 mark, within a 102.01 to 102.28 range. Newsflow for the USD has been lacking this morning, whilst focus has been on the geopolitical situation, which remains tense. The Houthis and Saudi Arabia continue tit-for-tat strikes, with the latter subject to attacks on key pipelines and airports. A factor, along with continued strikes in the Strait of Hormuz, which have kept energy benchmarks elevated.
• USD action over the past couple of days has been attributed to EUR volatility. Recent pressure in the single currency was due to ongoing French fiscal concerns, and the potential contagion risk across Europe. That appeared to ease earlier today, as OATs found some relief heading into a Le Pen speech. She was expected to outline her own budget plan, and perhaps more pertinently explain how she would achieve it. She did the first part by providing her targets, which were seen to be quite optimistic. However, some were left disappointed given that she did not say what policies would be enacted to achieve the targets. It seems as though OATs (and to some extent the EUR) have bought into her speech so far, but there is likely room for further EUR pressure in the near-term heading into October 13, where general debates will begin.
• JPY underperforms this morning, in-line with CHF. Much of the pressure is in tandem with narrowing yield differentials, but there are some domestic factors also at play. For starter, a Reuters source report suggested that the BoJ may be cautious about raising rates in October, and instead signal that underlying inflation has hit the 2% inflation target. A report which downplays an immediate hike, but plays in favour of faster tightening at the Bank, with MUFG believing it is in-fitting with its view of another hike in December. Another reason behind the pressure could be some continuation of the Bloomberg report from Monday, which suggested that the GPIF did not discuss portfolio allocation.

FIXED INCOME

• A bullish start for fixed amid a modest pullback in energy prices, but particularly as EGBs mount a recovery with France driving into and after the RN alternative budget speech.
• OATs firmer by over 110 ticks at best, hitting a 109.99 peak just after the cash equity open, a tick shy of the 30th October high, which was the session before the draft budget presentation. As such, the OAT-Bund 10yr yield spread narrowed to 133bps, vs over 150bps last week.
• However, while largely intact, some of this strength waned on the alternate presentation from RN’s Le Pen. As, in brief, her proposals are a significant departure from the govt’s draft, and are perhaps being regarded as unrealistic by the market. Initial commentary which weighed on OATs by about 30 ticks vs the peak at the time.
• Since, as Le Pen continues to speak, the tone remains one of a fiscally constructive approach and while ambitious, the market has turned-around and moved to highs, seemingly on her openness to wholesale fiscal reform and coordination with other European authorities, particularly the ECB. Taking OATs to a new high of 110.23 at the time of publication, and the 10yr yield spread to Germany down to c. 128bps. Note, this has also come alongside crude benchmarks hitting fresh lows, Brent USD 1.20/bbl lower on the day, but Dutch TTF remains firmer by over EUR 3/MWh.
• Elsewhere, EGBs are generally on the front-foot. Bunds saw a bounce on a dismal set of German factory orders for August. However, this was almost entirely due to the impact of the "Other Vehicle Construction" sector after an exceptionally strong July print, and as such is likely not indicative of the situation across the bloc. Currently, Bunds are firmer by around 40 ticks and hold some 20 off the 121.37 high.
• USTs firmer, but with magnitudes slightly less pronounced into data and Fed speak. At the upper-end of a 104-04 to 104-14+ band.
• Germany sells EUR 4.526bln vs Exp. 6bln 3.00% 2028 Schatz: b/c 1.08x, average yield 3.10%, retention 24.6%.
• UK sells GBP 1.25bln 1.125% 2035 I/L Gilt: b/c 3.62x (prev. 3.37x), real yield 1.860% (prev. 1.725%).
• Japan sells JPY 1.97tln 10yr JGBs: b/c 3.76x (prev. 3.29x), average yield 3.101% (prev. 2.995%), Tail in price 0.02 (prev. 0.12).

COMMODITIES

• WTI Nov and Brent Dec futures are softer following Monday’s choppy session, with the complex pressured by recovering Persian Gulf exports, Saudi OSP cuts and recent emergency stock releases. Kpler data showed average daily crude flows through the Strait of Hormuz recovered to 10.3mln BPD in the seven days to Saturday, around 76% of pre-war levels, while Trump reiterated that the US had secured the Strait and expects the Iran war to end soon. Geopolitical risks remain after reports of another Yemeni attack on Saudi Aramco facilities in Jeddah, while Saudi Arabia confirmed Jazan and Najran airports were struck on Monday. Iran also kept up the rhetoric, with officials warning that its forces are ready to respond to any US or Israeli “miscalculation”. At the same time, some diplomatic tones remain after Iran said talks in Doha addressed Qatari and Pakistani mediation proposals aimed at reducing regional tensions and averting further war.
• WTI has fallen from a USD 90.05/bbl high to USD 87.56/bbl, while Brent has declined from USD 100.99/bbl to USD 98.47/bbl.
• Dutch TTF is sharply firmer and has extended to a EUR 76.45/MWh high from EUR 74.03/MWh, with European energy security concerns remaining at the front of traders' minds. Equinor noted that European gas customers are showing greater willingness to sign long-term contracts extending into the 2040s, while European Commission President von der Leyen said Europe must address structural vulnerabilities to volatile foreign fossil-fuel markets. Sticking with supply side, drones hit two commercial ships in the Black Sea off Bulgaria, sinking one.
• Precious metals are mixed, with spot gold firmer as USD dips with oil. The yellow metal has rebounded from USD 4,104/oz to above USD 4,150/oz, within a USD 4,104-4,157/oz range, while spot silver is little changed within a USD 60.28-61.21/oz range.
• Base metals are modestly firmer, with copper extending recent gains amid the positive risk tone and expectations for stronger AI-related demand for data centres and power infrastructure. However, upside remains tempered by the continued absence of mainland China for the National Day holiday. 3M LME copper trades in a USD 14,393.08-14,485.00/t range at the time of writing.
• US President Trump signed an order to waive off-road requirements to allow anyone to purchase tax-free red-dyed diesel. Trump separately commented that Russian refinery strikes by Ukraine and US closures are driving up gas prices.
• Saudi Energy Minister said 5.8mln BPD is currently flowing through the East-West pipeline, and that operations resumed around five days after the hit.
• EU President von der Leyen said Europe must address structural issues that leave it exposed to volatile foreign fossil fuel markets. She announced that the EU will give exporters an extra year to comply with the methane regulation and will launch a strategic dialogue on European refineries to bring down costs and ensure supplies.
• The diesel export ban may be lifted in October for some Russian companies, according to IFX.
• Kpler data showed average daily crude flows through the Strait of Hormuz were at 10.3mln bbls in the seven days to Saturday, which is about 76% of the pre-war baseline.

NOTABLE EUROPEAN HEADLINES

• French RN leader Le Pen said France could face a default if President Macron policy continues, while announcing a French deficit of 3% of GDP by 2032 at the latest. In terms of other targets, she plans for the deficit to be below 5% from 2027, aims to reduce the public deficit to 3% by 2030 and aims for EUR 140bln in savings in 2032, compared to 2026. Le Pen also announced that they aim to reduce the pension deficit, and plans will be unveiled in the next few weeks. She also said they would be open to some kind of wealth tax and that it would be important to discuss with the ECB for an intervention.
• Spanish PM Sanchez calling a snap election means it is now less likely the EU will agree on its long-term budget by end-2026, according to Politico citing sources.
• French Finance Minister Lescure said they are not at the stage of talking about ECB TPI and that they need to do everything to avoid getting to such a point.

NOTABLE EUROPEAN DATA RECAP

• German Factory Orders (Aug MM) -10.6% vs. Exp. -1% (Prev. 2.5%). "The negative trend in manufacturing orders in August 2026 is almost entirely attributable to the sharp decline in the "Other Vehicle Construction" sector. Seasonally and calendar-adjusted orders in this sector fell by 61.5% compared to July 2026."
• French Industrial Production (Aug MM) -0.3% vs. Exp. 0.3% (Prev. -0.6%).
• European Retail Sales (Aug MM) 0.1% vs. Exp. 0.2% (Prev. -0.6%).
• European Retail Sales (Aug YY) 0.8% vs. Exp. 1% (Prev. 0.4%).

CENTRAL BANKS

• BoJ Governor Ueda said Japan’s economy is recovering moderately, albeit with some weakness and that the September Tankan showed business sentiment remained in good shape. On policy, Ueda said that the pace and timing of future policy adjustments will be decided based on the likelihood of the baseline projections materialising and associated risks, while reiterating that the BoJ will continue to raise the policy rate in accordance with economic activity, prices and financial conditions. Prices are moving in line with the BoJ’s baseline forecasts and that it is important to anchor underlying inflation around 2%. On financial conditions, they are accommodative and that it continues to support economic activity even after the September rate hike.
• The BoJ may signal at the October meeting that underlying inflation has hit the 2% target to highlight its readiness to keep raising rates, according to Reuters citing sources. The report added that many members are cautious about delivering another hike in October and prefer to gauge more data.
• ECB's Lane said there have not yet been “very strong” second-round effects and the degree of pass-through into broader inflation remains uncertain. Lane reiterated that the main driver of the interest rate decision has been the inflation implications of the energy shock. On the fiscal environment, Lane said the degree of fiscal policy support for the economy in 2027 and 2028 will differ from 2026.
• ECB's Rehn said that energy inflation has not yet spread to other goods but that high long-term rates contribute to a slowdown in growth and reduces pass-through of energy prices to other prices and to wages. Furthermore, Rehn said that he is closely monitoring market conditions.
• BoE's Mann said supply shocks are embedding inflation.

NOTABLE US HEADLINES

• NY Fed has been visiting big banks to review their loans to private credit firms and understand their exposure, while officials have gone into JPMorgan (JPM), Wells Fargo (WFC), Barclays (BARC LN), and Morgan Stanley (MS) since the spring with questions about overall exposure and risk, according to Semafor.
• US Treasury Secretary Bessent said underlying, core inflation is down to around 2.3% and that interest rates are all a function of headline inflation, while he added that mortgage rates will come back down after the Iran conflict. Bessent said they inherited a big stack of debt and could start bending the debt curve very quickly, while he thinks they will see in excess of 3% growth for Q3 and noted the US economy is accelerating.
• US Senators Warren (D) and Blumenthal (D) reportedly wrote to the Trump administration for answers on industry influence on the AI regulatory framework, according to Semafor.

GEOPOLITICS

MIDDLE EAST

• US President Trump said they were able to eliminate Iran's military capabilities and secure the Strait of Hormuz, while he stated the Iran war will end soon, one way or another, and prices will fall.
• US CENTCOM said it maintains strict enforcement of the US blockade against Iran and redirected the 130th commercial vessel in the Middle East on Monday.
• A US Navy helicopter reportedly transmitted an emergency code over the Red Sea, while a report noted that the helicopter most likely crashed into the Red Sea, citing analysis of flight data. However, there was no confirmation or denial from the US, while the potential cause was also unknown, according to BNO News.
• Iranian Interior Minister Momeni said talks in Doha addressed Qatar and Pakistan’s mediation efforts, with proposals discussed aimed at reducing regional tensions and averting further war, IRNA reported.
• Saudi Arabia confirmed that Jazan and Najran airports were hit by strikes on Monday, according to reports, while air traffic was halted at Riyadh Airport due to a Houthi attack. Furthermore, Tasnim reported of new explosions at the Saudi Jeddah oil refinery and that a fire has broken out following an attack by Yemeni forces. Later, the Houthis said that they targeted Saudi Arabia's Abha airport with missiles, with no confirmation from Saudi officials.
• A Yemeni Houthi spokesperson said in response to the Saudi aggression that they carried out three qualitative military operations using a large number of ballistic and cruise missiles and drones, in which they targeted King Khalid International Airport in Riyadh and the Aramco refinery in Rabigh, as well as Abha Airport, Khamis Mushait Air Base, the Aqifa camp in Asir, and other critical sites in Najran and Jizan. Furthermore, their armed forces warned all international airlines using Saudi airspace to cease their flights, as it has become an operations zone for their forces, with the exception of the sacred airspace over Mecca and Medina.
• Yemeni Houthis said Dhubab near Bab al-Mandab remains under Houthi control.
• Lebanon and Israel talks are said to resume in Tampa, Florida before the Israeli election, with talks to be military, not political, and will likely be on October 20th, according to a Kan reporter citing Radio Lebanon.

RUSSIA-UKRAINE

• Russia carried out a strike on the Dnipro River Bridge in Zaporizhzhia.
• Moscow's mayor said 650 Ukrainian drones were launched towards the Moscow region.

OTHER

• South Korea's Defence Ministry said it is preparing a response to force North Korea to apologise for the mine blast that injured South Korean soldiers, while it added that North Korea must remove the mines it planted in the demilitarised zone border.
• Bulgaria's President said a drone struck two ships in the Black Sea economic zone of Bulgaria.

CRYPTO

• Bitcoin fell in the APAC session but reversed just shy of the USD 85k mark before reversing to USD 86k.

• APAC stocks mostly took impetus from the positive handover from Wall St, where all major indices gained and the Nasdaq led the advances to print a fresh record high, despite the continued upside in long-term Treasury yields.
• ASX 200 gained at the open with outperformance seen in real estate and utilities, while the top-weighted financials sector and mining stocks also contributed to the upside in the index.
• Nikkei 225 returned to above the 70,000 level but with the gains somewhat modest in comparison to the prior day's surge and in the absence of any major fresh catalysts, while it was recently reported that Japan’s GPIF did not discuss allocation at its September meeting.
• KOSPI underperformed on return from the long weekend with the index dragged lower by losses in its tech giants, while US President Trump had also previously threatened South Korea to sign on to the Alaska LNG deal or he will 'charge them more’.
• Hang Seng extended above the 24,000 level with tech and biopharmaceuticals spearheading the advances, while it was also reported that China's Moonshot is to close its pre-IPO funding round at a USD 50bln valuation and eyes a Hong Kong IPO in Q1 next year.

NOTABLE ASIA-PAC HEADLINES

• Japan's Finance Minister Katayama said they have enough measures to meet spending needs for next year's budget and will thoroughly communicate with markets.
• Japanese Senior Lawmaker said that Japan should expand sales of government bonds to retail investors to create a more stable domestic investor base.
• Australia's Treasurer Chalmers said private sector is leading growth in Australia's economy, adding that Australia has a long-standing productivity challenge but noted Australia's economy story is a positive one.

NOTABLE APAC DATA RECAP

• Australian Westpac Consumer Confidence Change (Oct) -4.7% (Prev. -5.2%).
• Australian Westpac Consumer Confidence Index (Oct) 80.4 (Prev. 84.4).
• Indian HSBC Composite PMI Final (Sep) 55.90 vs. Exp. 56.50 (Prev. 54.30).
• Indian HSBC Services PMI Final (Sep) 55.2 vs. Exp. 56.2 (Prev. 54.1).