Newsquawk European Market Wrap - 8th September 2026

• European bourses have managed to claw back some of its earlier losses and are set to close the session mixed.
• JPY continued to extends on recent gains, whilst the Kiwi was the underperformer.
• Crude benchmarks pared some of their earlier upside following more constructive diplomatic headlines.

EQUITIES

• European bourses have managed to claw back some of its earlier losses and are set to close the session mixed. The Swiss SMI (-1.5%) remained the clear laggard, while the AEX (+0.4%) was the outperformer. Driving price action was primarily the energy complex, which pulled back from its earlier highs on headlines that a Hormuz route may be agreed upon soon and that Qatar is working with partners to resume talks with the US and Iran.
• Sectors ended mixed. Basic Resources ended as the clear outperformer, followed by Chemicals and Food, Beverages & Tobacco. To the downside remained Health Care, with Insurance and Tech rounding out the sector laggards.
• Key movers included: Novartis (-9.6%), phase 3 del-desiran trial failed to meet primary endpoints; AstraZeneca (-0.1%), phase 3 tozorakimab data in COPD showed a 29%-34% reduction in exacerbations; Solvay (+2.5%), reportedly in talks about a potential strategic partnership for its rare earths business; Infineon (-4.2%), downgraded to equal weight at Morgan Stanley.
• US cash equities opened with broad losses, with downside in NDX limited by upside in Intel (+5.6%) after the Co. was upgraded to outperform at Northland.

FX

• Snapshot: G10s were mixed against the USD. JPY continued to extends on recent gains, whilst the Kiwi was the underperformer as it digested mixed Chinese Trade data, which from the prior albeit less than consensus.
• DXY was incrementally firmer this morning, and held within a 98.71-99.00 range. US-specific news flow has been lacking as participants return from holiday, but focus will be on trade updates between the US and Canada. On that note, Canada's retaliatory tariffs against US goods took effect, as scheduled. The Loonie was a touch firmer vs USD this morning, but likely benefiting from the surge in energy prices rather than any trade-related optimism.
• The Yen story remained much more pertinent for the USD. Recent thin liquidity (due to Labor Day) has allowed the JPY to take more ground against the USD, with USD/JPY briefly dipping below the 153.00 mark. Also helping the outperformance today is the firmer-than-expected Labour Cash Earnings and an upward Q2 GDP revision. There were also comments from Japanese Finance Minister Katayama, who stated there was no change to their forex stance since the Japan-US joint intervention and that they will closely communicate with the US to achieve orderly forex markets.
• EUR was initially a touch lower this morning, but now set to end the London session flat. Attention will be on the ECB on Thursday, which will hike rates by 25bps. If oil prices continue to lift energy prices, and second-round effects begin to filter through into the Eurozone economy, another hike in December could be likely. The single currency currently holds around 1.1611, with the high of the day a couple pips above its 200-DMA (1.1633).

FIXED INCOME

• Despite some slight respite being found overnight, fixed income reverted to the red in the European morning as energy extended to fresh highs and Brent surpassed the USD 99.0/bbl handle. As such, yields were bid across the globe and the curve, with the UK feeling this most keenly given its energy sensitivity and after AMZN filing for GBP-denominated issuance.
• At most, this took Bunds, Gilts and USTs to lows of 121.64, 85.56 and 107-09+ respectively. However, energy has since waned from highs, though remains in the red, and some modest respite has been found for fixed and by extension yields, with benchmarks now firmer across the board.
• Gilts, which initially underperformed as mentioned, are set to end the European day firmer by around 20 ticks and back above the 86.00 handle vs an 85.56 trough. No reaction to the BoE TSC which remains underway. Strength is potentially a function of the strong indicative demand at the UK syndication, though given the highest 30yr yield offered on record by the DMO, this is perhaps not too surprising.
• Bunds also firmer, by a similar amount and above 122.00 vs a 121.64 low. Specifics for the space light, upside despite the continued strength in TTF. Generally, we continue to await a concrete response from Chancellor Merz on the strength of AfD, something that will become increasingly acute into more regional elections this month. Before that though, the ECB looms on Thursday, and while a 25bps hike is all but priced, the market will be keenly attentive to any dovish/hawkish signal from the statement/forecasts/presser, particularly at the short-end of the curve.
• Autodesk (ADSK) files to sell USD-denominated 3-, 7-year noted.
• 16 potential borrowers are considering US investment-grade bond sales Tuesday, though some issuers are staying sidelined amid a softer credit backdrop and may return later in the week if market conditions improve, according to a Bloomberg survey.
• Santander UK (SAN SM) files to sell USD-denominated 3-parter.
• Germany sold EUR 1.374bln vs exp. 1.5bln 2.30% 2033 and 2.60% 2041 Green Bund. 2.30% 2033 Green: b/c 2.55x (prev. 3.45x), average yield 3.19% (prev. 2.86%), retention 2.7%. 2.60% 2041 Green: b/c 1.32x (prev. 1.38x), average yield 3.31% (prev. 3.31%), retention 14.1%.
• The Netherlands sold EUR 3bln vs exp. 2.5-3bln 2.75% 2036 DSL: Avg. yield 3.463% (prev. 3.206%).
• Amazon (AMZN) to sell GBP-denominated bonds; 3yr, 6yr, 12yr & 19yr.

COMMODITIES

• Crude - WTI Oct and Brent Nov futures remained firmer amid heightened US-Iran tensions and the latest Saudi-Houthi escalation, although benchmarks pared some of their earlier upside following more constructive diplomatic headlines. Iran reported “significant progress” on a Strait of Hormuz shipping route, while Qatar said it is working with regional partners and China to resume US-Iran talks. WTI rose from a USD 90.87/bbl low to USD 94.73/bbl before easing to around USD 92.80/bbl, while Brent climbed from USD 96.78/bbl to USD 99.46/bbl before paring to around USD 97.70/bbl.
• Natural Gas - Dutch TTF remained firmly higher amid continued Middle Eastern supply risks, extending above earlier resistance around EUR 74.50/MWh. TTF rose from a EUR 73.02/MWh low to EUR 75.79/MWh before easing to around EUR 75/MWh, still firmer by over 2% on the session.
• Precious Metals - Precious metals recovered from earlier lows despite higher energy prices. Spot gold rebounded from USD 4,386/oz to around USD 4,400/oz, having earlier reached USD 4,442/oz high, and traded broadly subdued on the session. Spot silver similarly recovered from a USD 65.70/oz low to north of USD 66.50/oz, having earlier printed a peak at USD 67.18/oz, near its 100 DMA (USD 67.27/oz)
• Base Metals - Base metals remained mostly firmer amid supply concerns, tariff fears and ongoing hopes of Chinese stimulus. COMEX copper extended its upside to a USD 6.78/lb high from USD 6.59/lb and traded around the highs, up almost 3%, while 3M LME copper extended on record levels within a USD 14,511.92-14,780.58/t range.
• Germany's Economy Minister said German gas storage levels are in the range of 60-70% at the start of winter; there are import options, which are sufficient enough to meet expected winter demand.
• Some critical mineral firms chosen for the European Strategic Critical Mineral Projects have flagged liquidity concerns, according to documents.
• HSBC raises its H2'26 Dutch TTF gas price forecast to USD 22.5/MMBtu and its 2027 forecast to USD 17/MMBtu.
• UK government said a general licence will enable the continued operation of Azerbaijan’s Shah Deniz gas field.
• Iraqi Oil Minister said the Basra-Baniyas pipeline is under negotiation with US and Qatari companies.
• Iraqi Oil Minister said they will soon announce refinery development and construction opportunities for investors.
• Saudi Energy Minister said a number of energy facilities and utilities were hit; are temporarily halting some operations. Authorities are working to ensure the safety of facilities and continuity of operations.

EUROPEAN DATA

• French Current Account (Jul) -4.70B (Prev. -1.60B).
• French Trade Balance (Jul) -6.7B vs. Exp. -6B (Prev. -5.8B).
• French Exports (Jul) 54.7B (Prev. 54.5B).
• French Imports (Jul) 61.3B (Prev. 60.2B).
• German Trade Balance (Jul) 21.3B vs. Exp. 16B (Prev. 15.4B).
• German Imports (Jul MM) -5.7% (Prev. 4.4%).
• German Exports (Jul MM) -0.8% vs. Exp. 0% (Prev. 0.9%).

CENTRAL BANKS

• BoJ plans to raise rates by 25bps to 1.25% at the September 18 meeting, Kyodo reported.
• BoE Governor Bailey said the US Iran war has led to high energy prices and they could be still be higher.
• BoE's Greene said that the length of time oil prices has been high for, worries her, in relation to potential second round effects.
• BoE's Taylor judges that, for now, holding at a "moderately restrictive level" provides insurance. However, the conflict subsiding, energy moderating and underlying disinflation continuing would see the case for easing becoming stronger.
• BoE's Ramsden said that domestic inflation position is relatively benign; gets reassurance on inflation from the labour market, adding that UK wages has come in below what was expected before the conflict.
• BNP Paribas expects the BoE to lift interest rates by 25bps in November 2026 (prev. saw 25bps hike in September).
• RBA's Hauser said that the RBA stands ready to raise rates again if needed; the question is whether more is needed on interest rates. Will debate a hike at this month's meeting, outcome is not a certainty. Have not yet arrived at a point where they need to be sharply raising rates.
• Westpac sees the RBA hiking rates by 25bps in November.

GEOPOLITICS

MIDDLE EAST

• Aircrafts have reportedly targeted Houthi reinforcements on route to the west of Taiz, Al Hadath reported.
• Yemen's Deputy FM said "attacks on Saudi Arabia will continue until the end of the siege of Yemen", Tasnim reported; targeted Saudi's infrastructure to prevent Saudi oil exports.
• Saudi Foreign Minister said the path remains open for diplomacy to address the conflict with the Houthis, but will not hesitate to defend itself , Al Hadath reported.
• UK government said it is expanding restrictions on Iran’s financial, trade and aviation sectors.
• Qatar's Foreign Ministry said they are working with its regional partners and China to resume talks with the US and Iran.
• Houthi-run Al Masirah TV said four Saudi airstrikes hit Yemen’s Marib province.
• Iranian President Pezeshkian said Iran has always opposed war but will continue to resist aggression with full force until the aggressors are made to regret their actions.
• Iranian Official Azizi said "We inform the International Atomic Energy Agency and the Director General to pay attention to the fact that they are dealing with Iran after the war. Iran is different before the 40-day war and after it".
• Yemeni Houthis confirm they struck Aramco facilities as well as Khamis Mushait Air Base, with dozens of ballistic missiles and drones in response to recent Saudi airstrikes; warn that further attacks on Yemen will be met with broader strikes on Saudi.
• Tasnim analysis suggests that commentary from Iranian official Rezaei signals that Iran is considering expanding the geographic scope of its maritime confrontation into the northern Indian Ocean.
• Yemeni Houthi spokesperson said the group is to give an important statement at 9:30am local time (07:30 BST) regarding the military operation in Saudi Arabia.
• Iranian army said a US MQ-1 drone has been shot down over Bandar Abbas, Tasnim reported.
• China President Xi holds phone call with UK PM Burnham, reported Xinhua.
• Iranian Foreign Minister tells his Japanese counterpart that “significant progress” has been made on the Strait of Hormuz shipping route, SNN reported.
• Republican senators have suggested that the bipartisan crypto regulatory bill is likely to fail next week, Semafor reported.

RUSSIA-UKRAINE

• Russia's Kremlin spokesman said India and Russia are discussing the sale of Su-57 fighter jets.
• Kremlin spokesman reiterates that Russia is ready to move toward peace at any time, but that this depends on Kyiv.
• Ukrainian President Zelensky said he hopes to meet US President Trump later in September to discuss winter air defence package.
• Russia's Kremlin said that President Putin will take part in the BRICS summit.
• Russia’s Defence Ministry said Russian forces struck energy infrastructure and drone-manufacturing facilities in Odesa and the Odesa region.
• Russian Foreign Minister Lavrov rejected a proposal to halt strikes on civilian supply vessels in the Black Sea, Interfax reported.
• UK pledges GBP 100mln winter air defence package to support Ukraine’s defences.

NOTABLE NORTH AMERICAN NEWS

• US seeks more access to Venezuela’s mineral wealth after tapping its oil, according to reported.

NORTH AMERICAN DATA

• NFIB Business Optimism Index (Aug) 98.7 vs. Exp. 99.3 (Prev. 99.8).