Newsquawk European Market Wrap - 13th August 2026

Sentiment tilted firmer but with gains capped amid a lack of drivers. Little notable reaction seen to mostly soft-than-expected US PPI. Iran said Tehran-Muscat talks are ongoing and progressing positively, having achieved progress on several levels. EQUITIES European bourses are to end Thursday's trade entirely in the green, outside of the FTSE 100 given the large number of names trading ex-divs. Volumes have been light in recent sessions, giving the Summer feeling. With earnings nearing to an end, the next catalyst will be Nvidia earnings in 2 weeks and any geopolitical updates. Sectors held their positive bias. Retail topped the sector pile, followed by Food, Beverages & Tobacco and Travel & Leisure. On the other hand, Basic Resources was the clear laggard, given the drop in metals prices and Antofagasta (-4.5%) cutting its FY26 copper production guidance. Key movers included: Maersk (+8%), Q2 metrics beat and raised its FY26 guidance; Pandora (+5.3%), Q2 Net beat and noted of solid margins even excluding the IEEPA claim's positive benefit; Adyen (+15.4%), H1 revenue topped consensus and upped its FY guidance; Lanxess (-8.2%), downgraded to sell at Berenberg. US cash equities open entirely in the green, with outperformace in the RUT. Key movers include: Cisco (-8.6%), profit taking following strong earnings and guidance beat; HP (+7%), read across following Lenovo's 43% revnue increase Y/Y; Cerebras Systems (-9.8%), Q2 revenue missed estimates and gross margin fell. FX USD was choppy throughout the session after encountering some sellers towards 100.00 in DXY, which ING described as a function of traders rebuilding longs after recent July data. However, the Buck saw some weakness following Fed's Bostic and soft US PPI, data which came in below consensus for both headline and core figures. Coinciding with the data were remarks from Fed's Barkin and Hammack; the latter's remarks looked through given her known stance, but, more interestingly, Barkin noted "many" at the Fed feel the current level is restrictive enough to bring inflation down; a remark which triggered gradual DXY pressure, pushing it to a 99.80 low. JPY saw some strength after Bloomberg sources indicated the Takaichi government is said to support a faster BoJ rate hike. A report which has convinced markets, interest rate futures now implying a 75% probability of BoJ tightening in September. These bets could be added to should similar remarks come from Takaichi herself. USD/JPY fell c. 30 pips to a 159.18 base, before paring some of the move, now sitting around 159.30. NOK was weaker throughout the day as, while the Norges Bank left rates unchanged and kept the door open to further tightening, it signalled inflation progress in the statement. If this progress is reflected in September's statement, it could imply a removal of the tightening bias and, as such, has led to the trimming of NOK longs. Despite this, the bank remains slated to hike in September, a view held by Nordea and SEB. EUR/NOK was choppy on the announcement, initially falling 0.2% to a 10.90 base, before reversing the move to a peak just below 10.99. Cable is set to complete the London session modestly firmer, after some modest pressure in the Buck since the European afternoon. Little reaction seen to GDP metrics which were mostly firmer than expected, exept the in-line Q2 Q/Q, with services continuing to support and benefitting from the period of warm weather, while Pharmaceuticals also drove some manufacturing strength; the input often volatile and potentially subject to revision. However, while firmer-than-expected, the series is caveated by a weaker-than-expected breakdown for June and downward revisions to the May GDP series. Overall, the series does not change the extended hold narrative for the BoE. However, it does work in favour of those who raised dovish points at the last gathering. NZD was the G10 laggard after soft one year and two year inflation expectations. Kiwi saw pressure throughout the APAC session, but rebounded slightly vs. USD as it lost its shine throughout the day/ NZD/USD set to complete the London session -0.2%, after finding buyers below the 100 and 200 DMAs between 0.5820/30. FIXED INCOME Bunds firmed as the session progressed, in-fitting with the broader bid across fixed income and against the backdrop of softer energy prices. Bloc-specific newsflow remained light, with little else to shift the narrative. Bund futures rose to a 124.94 high from a 124.65 low, extending beyond the earlier 124.83 peak. Gilts moved higher following a limited initial reaction to the UK GDP series, which was stronger than expected across most components but caveated by a weaker June breakdown and downward revisions to May. Overall, the data did little to alter the extended hold narrative for the BoE. Gilt futures climbed to an 87.22 high from an 86.94 low. USTs extended their earlier upside, with mostly softer-than-expected US PPI doing little for price action in what seems like a summer lull and in the absence of major drivers. Amid softer energy prices, UST futures rose to a 108-27 high from a 108-15+ low, extending above the earlier 108-23 peak. COMMODITIES WTI Sep and Brent Oct futures remained subdued amid a lack of notable US-Iran-related updates. On diplomacy, Pakistan's key mediator held a second meeting with Iran's Foreign Minister Araghchi and sought to extend the 60-day truce, according to an informed source cited by Al Arabiya. Further, Iran said Tehran-Muscat talks are ongoing and progressing positively, having achieved progress on several levels. On the flip side, the Strait of Hormuz authority rejected US claims and said the waterway remained blocked until Iran's conditions are met, according to Press TV. Crude extended its downside as the session progressed, with WTI falling to a USD 80.30/bbl low from a USD 83.30/bbl high, while Brent fell to a USD 86.25/bbl low from a USD 89.07/bbl high. Dutch TTF remained on a softer footing and extended below EUR 60/MWh, with focus in Europe on limited storage replenishment ahead of winter against the backdrop of ongoing Middle Eastern issues. Precious Metals were mixed ahead of US PPI, which proved to be a damp squib. Spot gold extended its earlier downside to a USD 4,364/oz low from a USD 4,450/oz high, before recovering to around USD 4,395/oz and back above its 100 DMA (USD 4,387/oz). Spot silver fared better and recovered from a USD 64.22/oz low to around USD 65.41/oz, having earlier printed a USD 66.30/oz high. Base Metals were mixed/mostly lower, with copper recovering from earlier lows despite the summer lull. Antofagasta lowered its FY26 copper production guidance to 625-655k metric tonnes (prev. 650-700k) following a precautionary weather-related shutdown at Los Pelambres. 3M LME copper traded within a USD 13,949.58-14,136.00/t range, while COMEX copper recovered from a USD 6.50/lb low to near its USD 6.63/lb session high. Antofagasta (ANTO LN) said it expects a more moderate raw material price environment in H2. Qatar set its September official selling price for seaborne crude at USD 5.00/bbl below the Oman/Dubai benchmark, while land crude was priced at a USD 4.50/bbl discount to the same benchmark. Romania's Nuclearelectrica has begun to to disconnect the final nuclear reactor, due to the continued low Danube level. EUROPEAN DATA European Industrial Production (Jun MM) 0.0% vs. Exp. -0.1% (Prev. 0.3%). European Industrial Production (Jun YY) 0.1% vs. Exp. -0.8% (Prev. -0.1%). Spanish Core CPI Final (Jul YY) 3% vs. Exp. 3% (Prev. 2.9%). Spanish CPI Final (Jul MM) 0.3% vs. Exp. 0.2% (Prev. 0.6%). Spanish CPI Final (Jul YY) 3.6% vs. Exp. 3.5% (Prev. 3.2%). Spanish HICP Final (Jul MM) 0.0% vs. Exp. -0.1% (Prev. 0.6%). Spanish HICP Final (Jul YY) 3.9% vs. Exp. 3.8% (Prev. 3.6%). UK GDP Growth Rate Prel (Q2 QQ) 0.4% vs. Exp. 0.4% (Prev. 0.6%). UK Construction Orders (Q2 YY) -18.1% (Prev. -11.9%). UK Goods Trade Balance Non-EU (Jun) -10.45 (Prev. -9.58). UK Goods Trade Balance (Jun) -23.01 vs. Exp. -20.5 (Prev. -21.08). UK Business Investment Prel (Q2 YY) 0.8% (Prev. -1.3%). UK GDP Growth Rate Prel (Q2 YY) 1.2% vs. Exp. 1.1% (Prev. 0.9%). UK GDP (Jun MM) 0.3% vs. Exp. 0% (Prev. 0.0%). UK Business Investment Prel (Q2 QQ) 1.7% vs. Exp. -0.5% (Prev. 0.9%). UK GDP (Jun YY) 1.1% vs. Exp. 0.8% (Prev. 1.2%). UK Industrial Production (Jun YY) -0.2% vs. Exp. 0.2% (Prev. 1.0%). UK Construction Output (Jun YY) -2.3% vs. Exp. -2.4% (Prev. -2.0%). UK Manufacturing Production (Jun YY) 0.5% vs. Exp. 1.2% (Prev. 2.0%). UK Industrial Production (Jun MM) -0.2% vs. Exp. 0.1% (Prev. -0.7%). UK GDP 3-Month Avg (Jun) 0.4% vs. Exp. 0.4% (Prev. 0.6%). UK Manufacturing Production (Jun MM) -0.5% vs. Exp. -0.2% (Prev. -0.2%). UK Trade Balance (Jun) -5.537 (Prev. -1.044). Swedish CPIF Final (Jul MM) -0.3% vs. Exp. -0.3% (Prev. 0.3%). Swedish CPIF Final (Jul YY) 0.7% vs. Exp. 0.7% (Prev. 1.3%). TRADE/TARIFFS US White House Trade Advisor Navarro said any USMCA deal will have transshipment provisions. US is easing export controls on certain drones and drone parts, reported suggest. Indian Trade Ministry said they are actively in talks with the US on pending trade issues. CENTRAL BANKS Fed's Barkin (2027 voter) said current levels of federal debt are inflationary "wind" and that the Fed has to navigate against. Fed's Barkin (2027 voter) said still an open question whether the Fed needs to raise rates to restore 2% inflation, or whether it is already on a path down. There are also reasons to think price pressures are embedded, with either weakening demand or a rate increase needed to meet the Fed's target. Fed's Hammack (Voter, Hawkish Dissenter) reiterates the need to raise rates right now; labour market is stable, inflation data amid recent shocks has risen. Too much growth could put additional pressure on prices. Policy is not estrictive and firms are optimistic about growth and credit. Important Fed is held accountable to one inflation number. Must look at a range of data to "do that job on inflation". R Norges Bank maintains its rate at 4.25% as expected; may still become necessary to raise the policy rate. POLICY: The Committee judges that a restrictive monetary policy stance is still needed to bring inflation down to target within a reasonable time horizon. The future path of the policy rate will depend on economic developments. INFLATION: Slower inflation is welcome news, but inflation is still too high, and it is too early to conclude that the inflation outlook has changed materially. CBRT Quarterly Inflation report:. 2026 y/e inflation: 28% (prev. 26%), food inflation 28.5% (prev. 26.3%). 2027 y/e inflation: 15% (prev. 15%) food inflation 19% (prev. 19%). GEOPOLITICS MIDDLE EAST Iran said Tehran-Muscat talks are ongoing, and are progressing positively, having achieved progress on several levels, reported Al Mayadeen. Iran said the Strait of Hormuz is completely closed and maritime navigation cannot be resumed until the US meets Iran’s conditions, Al Mayadeen reported. Saudi Arabia is reportedly considering supporting the Yemeni army in a ground offensive to retake Red Sea coastal areas from the Houthi armed group, Jerusalem Post reported. Iran’s paramilitary Basij said the Strait of Hormuz is “under Iran’s control and management”, Fars News reported. Turkey said it will be forming a strategic, political and military mechanism for an alliance with Saudi Arabia and Pakistan. Israeli forces blow up and burn homes in southern Lebanon, according to Al Jazeera. RUSSIA-UKRAINE Russian Deputy Chairman of the Security Counci Medvedev said anyone who does not understand Russian ownership of the Kuril islands will face "dire" consequences, Tass reported; Medvedev references Japanese PM Takaichi with this. Ukraine's military said they hit Russia's oil refinery in Bashkortostan, some 1,300km from the border. Russian Defence Ministry said Russian forces struck Ukrainian military and port infrastructure overnight at the Danube ports of Reni and Izmail. NOTABLE NORTH AMERICAN NEWS BofA Total Card Spending (w/e Aug 8th) +6.2% Y/Y (prev. 4.7%); the rebound in spending over the past 3 weeks is consistent that the mid-July slump was a blip. NORTH AMERICAN DATA US Core PPI (Jul MM) 0.2% vs. Exp. 0.3% (Prev. 0.4%). US PPI (Jul YY) 4.7% vs. Exp. 4.9% (Prev. 5.5%). US PPI (Jul MM) 0% vs. Exp. 0.2% (Prev. -0.3%). US Continuing Jobless Claims (Aug/01) 1777k vs. Exp. 1800k (Prev. 1799k). US Initial Jobless Claims (Aug/08) 209k vs. Exp. 202k (Prev. 200k). US PPI (Jul) 156.563 (Prev. 156.566). US PPI Ex Food, Energy and Trade (Jul MM) 0.4% (Prev. 0.1%). US PPI Ex Food, Energy and Trade (Jul YY) 4.7% (Prev. 5.0%). US PPI PCE Components (July). Portfolio Management PPI: 6.46% (prev. 0.59%). Air Passenger Transport PPI: -3.21% (prev. 1.77%). Physician Care: -0.15% (prev. 0.05%). Home Health & Hospice Care: 0.10% (prev. 0.32%). Hospital Outpatient Care: 0.86% (prev. -0.11%). Hospital Inpatient Care: 0.16% (prev. 0.40%). Nursing Home Care: 0.44% (prev. 0.18%). Also available under the US Macro Data widget on the Newsquawk site. US Jobless Claims 4-week Average (Aug/08) 199.00 (Prev. 199.00). NOTABLE GLOBAL EQUITY HEADLINES Shein loses UK copyright lawsuit against Temu (PDD) over clothing photos. Fitch downgrades Baidu (9888 HK / BIDU) to 'A-‌'‌; Outlook Stable. "The downgrade reflects Baidu's lower EBITDA generation due to the structural decline in its search advertising business. The emerging AI search and competing AI chatbots are also likely to erode Baidu's monetization from the search business.".