Market News

Stocks Find Support Despite Ongoing Tensions in the Gulf – Dow up 0.5%

US equities recovered some of their recent losses in trading yesterday as investors looked for value despite further hostilities in the Middle East. The Dow Jones rose 0.56% to 53,061, while the S&P 500 gained 0.46% to 7,666 and the Nasdaq advanced 0.45% to 26,217.

Treasury yields eased from their recent highs, with the US 2-year yield falling 3.1 basis points to 4.369%, while the 10-year yield declined 2.0 basis points to 4.778%. The pullback in yields also weighed on the US dollar, with the USD Index falling 0.12% to 99.56 as the greenback weakened against the major currencies.

Oil prices continued to push higher as markets priced in the risk of further…

IC – Asia Fundamental Forecast | 03 September 2026

What happened in the U.S. session?

Weaker-than-expected ADP employment data increased concerns about a slowing labour market and initially weighed on the dollar, while renewed U.S.–Iran tensions pushed oil higher and kept inflation fears alive.

Elevated Treasury yields continued to pressure gold and rate-sensitive assets, while equities remained relatively resilient thanks to strong AI-related sentiment. For the next session, U.S. Unemployment Claims and ISM Services PMI are the key releases to watch, with stronger-than-expected data likely supporting the USD and yields, while weaker data could reinforce expectations for easier Fed policy.

What does it mean for the Asia Session?

The main…

●         Asian Stock Markets : Nikkei up 0.40%, Shanghai Composite up 0.43% Hang Seng down 0.14% ASX up 0.44%

●        Commodities : Gold at $4,472.89 (1.32%) Silver at $66.503 (1.60%), Brent Oil at 95.67 (-0.17%), WTI Oil at 90.98 (-0.03%)

●        Rates : US 10-year yield at 4.772, UK 10-year yield at 5.2347, Germany 10-year yield at 3.3761

●        (NZD)     Official Cash Rate   2.75% to 2.75%  expected

 U.S. equity futures were little changed Wednesday evening after Wall Street’s major averages snapped a three-day losing streak driven by rising Treasury yields and renewed fighting between the U.S. and Iran.

S&P 500 futures edged up 0.02%, while Dow futures gained 19…

The surging run higher in bond yields has definitely gotten markets buzzing this past week. In that lieu, one of the more common market themes is that higher bond yields tend to be bad for stocks. In recent days, that certainly looks to be true.

When Treasury yields pushed up earlier this week, with 10-year yields hitting 4.81% (the highest since October 2023), equities came under pressure with both growth and tech shares buckling lower.

Typically, markets have come to know that higher Treasury yields tend to create a tougher environment for equities. But why exactly?

The simple theory is that investors can earn a higher return from relatively safe government bonds, which then raises the hurdle rate for owning riskier assets such as stocks.…

FUNDAMENTAL OVERVIEW

The Nasdaq is currently trading at the same levels we’ve seen in May. The index has been pretty much rangebound with high volatility for four months. The two main reasons for such underperformance are Fed tightening risks and the US-Iran war, as they both negative drivers for future growth.

The problem is that these negative factors happened when positioning was heavily lopsided. In fact, tech stocks, especially semiconductors, were the most crowded trades on record. As macro conditions changed, we’ve started to see deleveraging across the board.

The latest push lower was triggered by the hawkish Fed Chair Warsh’s speech that retightened financial…

A quick catch-up of the PMI prints that we got for today:

• Spain August services PMI: 57.8 (previously 58.3)
• Spain August composite PMI: 55.8 (previously 56.5)
• Italy August services PMI: 55.2 (previously 52.5)
• Italy August composite PMI: 53.6 (previously 52.5)
• France August final services PMI: 48.0 (previously 49.6)
• France August final composite PMI: 48.5 (previously 49.4)
• Germany August final services PMI: 49.7 (previously 49.8)
• Germany August final composite PMI: 51.8 (previously 51.3)
• Eurozone August final services PMI: 51.6 (previously 51.7)
• Eurozone August final composite PMI: 52.0 (previously 52.0)

Looking to the overall euro area estimates, we can see that private sector business activity growth kept pace with that seen in July, which was the…

FUNDAMENTAL OVERVIEW

USD:

The US dollar has been pulling back across the board on potential profit-taking as the hawkish repricing stabilised. The upcoming US CPI report next Friday remains the key risk event that could influence market pricing. As of now, traders are seeing a 58% chance of a rate hike in September.

I think only a soft CPI could bring the probabilities below 50% and deter the Fed from hiking at the upcoming meeting. If the probabilities stay at or above 50%, the Fed might be forced to hike regardless because failure to do so would send a dovish message. 

EUR:

On the EUR side, the ECB is widely expected to hike interest rates by 25 bps at the upcoming…