Newsquawk Daily US Opening News - 20th August 2026

US President Trump announced sweeping economic measures against Iran and threatened consequences for countries or entities supporting Tehran. US President Trump reportedly told his negotiating team that the chances of an agreement with Iran have become slim, according to Al Arabiya, citing sources. US equity futures are muted; focus to be on Walmart earnings. DXY extends on Wednesday's losses; NZD outperforms while AUD completely pares the employment report weakness. USTs give back some of the gains driven by the US Treasury announcement. Energy benchmarks higher despite contained APAC trade following Trump's economic update (Brent +2.5%). Looking ahead, highlights include Canadian PPI (Jul), US Initial Jobless Claims (Aug 15), New Zealand Trade Data (Jul). Comments from Fed's Daly and US President Trump. Earnings from Walmart. SNAPSHOT STOCKS Euro Stoxx 50 -0.2% DAX40 -0.6% Stoxx 600 -0.1% FTSE 100 -0.2% ES Sep'26 -0.1% RTY Sep'26 -0.2% NQ Sep'26 U/C YM Sep'26 -0.2% FX DXY -0.2% (98.60) EUR/USD +0.3% (1.1706) USD/JPY +0.1% (158.63) GBP/USD +0.3% (1.3644) BONDS US T-Note Sep'26 -3 ticks Bund Sep'26 +3 ticks US 10yr Yield 4.672% German 10yr Yield 3.258% ENERGY & METALS WTI Oct'26 +2.5% Brent Oct'26 +2.5% Spot Gold -0.8% LME Copper -0.2% CRYPTO Bitcoin +3.8% Ethereum +1.5% As of 10:40BST / 05:40EDT EUROPEAN TRADE EQUITIES European bourses trade mixed, with underperformance in Germany's DAX 40 (-0.6%) while the majority of other indices are flat/slightly firmer. European sectors point to a mixed picture. Autos top the sector pile, with Construction and Utilities rounding out the top 3 performers. To the downside is Basic Resources, paring back some of Wednesday's gains. Telecoms and Travel & Leisure round out the sector laggards. US equity futures are softer across the board, albeit only modestly. Newsflow has been light for US equities. An update for Moderna, shares are lower by some 15% pre-market after closing with gains of 177%. Looking ahead, Walmart is to report earnings. Click for the sessions European pre-market equity newsflow Click for the additional news FX Quiet action in FX after broad based USD weakness vs all peers on the surprise Treasury announcement yesterday, an update which led to significant curve flattening with the 30yr yield falling in excess of 10bps. Although the figure announced by the Treasury was modest, it shows Bessent’s commitment to keeping yields in check when above 5% in the long segment; alongside this, FOMC minutes encouraged some dovish action in shorter dated USTs. Yields will remain in focus and we have Fed speakers Daly and Musalem set to speak on business TV later today, likely to be asked on this topic. USD action is mixed against G10 peers, weaker vs. cyclicals, firmer/flat vs havens. DXY is modestly weaker after slipping below May’s support around 98.80, it is essentially no man's land below with 98.00 the likely next support. SEK weakness after the Riksbank announcement which, in short, was broadly as expected but failed to convince some market expectations of tightening later in the year (i.e. Danske expecting two hikes, JPMorgan seeing one). While keeping the door open to tightening later in the year, some dovish leads can also be interpreted from the mood of language on the economy, where the reiterated language comes despite a rebound in domestic GDP. EUR/SEK moved higher throughout the morning to a peak just below 11.06, +0.4% on the day. Action elsewhere is quiet. AUD is towards the bottom of the G10 pile despite the constructive risk environment; underperformance a function of disappointing jobs data in which headline Employment Change contracted and the Unemployment Rate rose. AUD/NZD fell in excess of 40 pips after the data, selling which was halted just under the 1.1950 mark, AUD/USD is flat despite a kneejerk lower after the data. FIXED INCOME Fixed income benchmarks are lower/flat. Yields are firmer across the curve this morning, albeit only mildly so. This comes after the curve flattened in the prior session, following the US Treasury’s decision to double long-end buybacks, attempting to provide greater liquidity support. However, by all intents and purposes, markets have received the news as the Treasury being concerned about recent elevated yields. Some will also point towards the recent US-Japan cooperation on JPY intervention; whilst unlikely to be a main factor for the Treasury’s buy-back announcement, the timing is interesting. For now, yields are off recent peaks, but still remain towards multi-year highs. Fiscal concerns continue to remain the theme, with the US gross national debt now above the USD 40tln mark. The US30yr (5.22%) holds beyond the 5% mark, whilst the US10yr (4.66%) remains above the key 4.5% mark. ING opines that it is “unlikely” that the 10yr will fall below 4.5%, but believes it is “clear” that any move above 5% “or even the material threat thereof” would receive active resistance by the US Treasury. The key dates to watch are as follows: September 9th (the new doubled buyback goes into effect) and then November 4th (next QRA, where the current program window ends, and the Treasury will provide more updates on sizes/frequency). Bunds (+3 tick) and Gilts (-8 ticks) remain flat/lower, in what has been a quite domestic newsflow session for the respective regions. On a macro level, energy benchmarks continue to rise (Brent Oct’26 +2.5%), with the latest bout of geopolitical updates indicating a resurgence of hostilities in the Middle East (see commodities for details). France sells EUR 12.5bln vs exp. EUR 10.5-12.5bln 2.40% 2029, 2.70% 2031, 3.25% 2032 and 3.00% 2034 OAT. Japan sells JPY 532.1bln 20-year JGBs; b/c 3.98x (prev. 4.52), average yield 3.698% (prev. 3.626%), tail in price 0.17 (prev. 0.00). COMMODITIES WTI and Brent October futures are firmer intraday amid a slew of geopolitical updates, with the headline developments being Trump announcing economic measures and Iran threatening to withdraw from the NPT (details below). Modest downticks were seen after Al Arabiya reported that US President Trump "told his negotiating team that the chances of an agreement with Iran have become slim", with the downside possibly as traders take these reports with a pinch of salt, as it is highly unusual for local Arab media outlets to break major source reports directly from inside a US admin before domestic US media outlets. Since then, prices have resumed an upward trend, with Brent currently sitting near its session high in a USD 91.47-94.04 range (vs yesterday’s USD 92.81/bbl high) and WTI similarly towards the upper end of a USD 84.23-86.61/bbl band (vs yesterday’s USD 85.84/bbl peak). Dutch TTF futures post modest gains but remain above EUR 64/MWh after trading north of EUR 64.50/MWh in early trade and then finding support just under EUR 63.50/MWh. Metals are softer across the board despite the softer USD as the complex pulls back from yesterday’s US Treasury-induced gains whilst also feeling the weight of higher oil prices. Spot gold has fallen back under its 200 DMA (4,512/oz) to trade towards the bottom of a USD 4,478-4,524/oz range (vs yesterday’s 4,325-4,524/oz parameter). Spot silver resides towards the bottom of a USD 66.40-67.32/oz range. Elsewhere, 3M LME copper briefly tested USD 14k/t to the downside to trade in a current USD 13,980.68-14,083.00/t range. TRADE/TARIFFS The US is reportedly set to cut the tariffs on imported Canadian autos to 15% from 25%, Bloomberg reported. NOTABLE EUROPEAN DATA RECAP German PPI (Jul MM) 1.1% vs. Exp. 0.7% (Prev. -0.3%). German PPI (Jul YY) 3.0% vs. Exp. 2.7% (Prev. 1.8%). CENTRAL BANKS The Riksbank maintained its rate at 1.75% as expected and assesses that the probability of a rate increase later this year remains. The Bank stated that the outlook for the economy remains largely unchanged but that if the unexpectedly high inflation during the summer were to be the start of a larger and more lasting upturn in inflation, the Riksbank would adjust its monetary policy in a tighter direction. In the post-policy press conference, Riksbank's Thedeen said they are somewhat concerned about the recent inflation outcomes and that the economy is showing signs of strength. NOTABLE US HEADLINES The US national debt has surpassed USD 40tln, according to CBS citing Treasury Department data. GEOPOLITICS MIDDLE EAST US President Trump posted "No one has given the Islamic Republic of Iran a greater opportunity to make a Deal than me. TRAGICALLY, for them, they have failed to take it. Therefore, today, I am announcing the MOST CRUSHING ECONOMIC OPERATION EVER TAKEN AGAINST ANY COUNTRY! This will be Economic Warfare and Isolation on an unprecedented scale. Trump added that "ANY country that allows its financial institutions, businesses, airports, or government entities to provide any type of lifeline to Iran will itself face TREMENDOUS Economic Consequences. Oil smuggling, swap lines, cash transfers, exchange houses, ship registries, front companies — It all needs to stop NOW. You know who you are. This will be an ECONOMIC D-DAY". US President Trump reportedly told his negotiating team that the chances of an agreement with Iran have become slim, according to Al Arabiya, citing sources. The source added that Trump ordered a freeze on negotiations with Iran for several weeks, with the possibility of extending them. Additionally, the report added that the US administration saw reports of an Iranian plan to resume attacks on ships and was briefed on information regarding a potential Houthi escalation in Bab al-Mandab and on an Iranian plan for operations that go beyond targeting ships. Trump informed his team of the possibility of launching massive attacks on Iran if economic pressure fails. Iranian Foreign Minister Araghchi said that insisting on failed policies will only lead to more failures and will lead to hostility from Iranians. Iranian Supreme Leader adviser Rezaei said the best response to Trump's escalation of economic warfare is to withdraw from the NPT. The US administration believes that the Iran-Oman discussions broke down weeks ago, according to Semafor citing an official source. Iranian Foreign Minister Araghchi held talks with Pakistan's Army Chief on regional developments, with the two sides discussing ongoing diplomatic initiatives, potential political solutions and ways to deepen consultation and cooperation. Yemeni sources reported that Houthis are preparing to enter a new phase of escalation against Saudi Arabia, according to Tasnim. Israeli warplanes attacked the Tal al-Dabsha area northwest of Ali al-Taher Hill in southern Lebanon, according to IRIB news. Turkish Defence Ministry said that they will continue to support Syria's efforts to develop their own military capability. RUSSIA-UKRAINE Russia attacked military facilities and a logistics hub in Kyiv and the region, while it also hit a drone component production facility in Kyiv, according to Russian press, quoting the Defence Ministry. Several explosions were heard in central Kyiv, Ukraine, according to witnesses. This was later confirmed by the Kyiv Mayor, stating the city is under attack from Russian ballistic missiles. Polish Armed Forces said the Polish military activated aircraft and air defences as Russia carried out strikes on Ukraine. OTHER Japan said North Korea fired what could be a ballistic missile, which was later announced by South Korea, stating that North Korea's military fired an unidentified projectile towards the east sea. The missile has landed outside of Japan's Exclusive Economic Zone CRYPTO Bitcoin returns above the USD 70k mark for the first time since June, after Wednesday's drive lower in US yields and reports of a meeting between US President Trump and industry leaders. APAC TRADE APAC stocks were predominantly higher following a similar positive lead from Wall Street, where most of the major indices gained as yields and the dollar declined after the US Treasury doubled buybacks of long-term bonds. ASX 200 marginally gained with outperformance seen in miners and as participants digested a slew of earnings updates, although the upside is capped as financials lagged, and following disappointing jobs data. Nikkei 225 was underpinned by a rebound in tech, a pullback in yields and stronger-than-expected trade data. KOSPI led the advances in the region amid upside in the tech heavyweights, with SK Hynix shares up double digits following the announcement of a KRW 40tln share buyback, while there were reports that Samsung Electronics is planning to announce a shareholder return plan topping KRW 100tln. Hang Seng and Shanghai Comp conformed to the positive mood but with gains capped amid a deluge of earnings updates and as participants await Alibaba's earnings report, while the mainland is also contained after the PBoC kept its 7-day reverse repo operations at zero, and it maintained the benchmark Loan Prime Rates at their current levels for the 15th consecutive month. NOTABLE ASIA-PAC HEADLINES Japan's METI reportedly plans to request around JPY 7.7tln for its FY27 budget, which is a significant boost from its FY26 allocation. NOTABLE APAC DATA RECAP Chinese Loan Prime Rate 1Y 3.0% vs. Exp. 3.0% (Prev. 3.0%). Chinese Loan Prime Rate 5Y (Aug) 3.5% vs. Exp. 3.5% (Prev. 3.5%). Australian Unemployment Rate (Jul) 4.5% vs. Exp. 4.4% (Prev. 4.4%). Australian Employment Change (Jul) -15.8K vs. Exp. 15K (Prev. 76.3K). Japanese Trade Balance (Jul) -634.5B vs. Exp. -680B (Prev. -409.9B). Japanese Exports (Jul YY) 23.2% vs. Exp. 19.9% (Prev. 19.3%). Japanese Imports (Jul YY) 27.8% vs. Exp. 26.5% (Prev. 25.4%). Taiwan Export Orders (Jul) +61.9% Y/Y (exp. 54.6% Y/Y).