• Equities are modestly firmer, ex-FTSE 100, in a continuation of the optimism seen in the prior session
• Dollar is softer vs peers, Kiwi outperforms and USD/JPY holds around 148.70
• USTs are contained, but off worst levels, Gilts fairly unreactive to its own Retail Sales, holding just shy of 100.00
• Crude is on the backfoot, with pressure fuelled by updates from Libya’s Waha Oil Company, XAU incrementally firmer whilst base metals are mostly lower
• Looking ahead, US Building Permits/Housing Starts, Uni. of Michigan (Prelim.), Comments from Fed’s Goolsbee

EUROPEAN TRADE

EQUITIES

• European bourses, Stoxx 600 (+0.5%) are almost entirely in the green, in a continuation of the optimism seen following the strong US Retail Sales figure seen in the prior session.
• European sectors hold a positive tilt and with a cyclical bias; sectors such as Autos, Retail and Travel & Leisure are towards the top of the pile. Telecoms is towards the foot of the pile alongside Optimised Personal Care.
• US Equity Futures (ES +0.1%, NQ +0.2%, RTY +0.3%) are entirely in the green, continuing the Retail Sales induced strength; the RTY, once again, outperforms.
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FX

• USD is softer across the board vs. peers in an unwind of some of the bullishness seen in the wake of Thursday's solid US retail sales. DXY is now back on a 102 handle after being as high as 103.22 on Thursday.
• EUR is edging gains vs. an across-the-board weaker dollar but the EUR/USD pair is unable to reclaim a 1.10 status after being as high as 1.1047 earlier in the week (YTD peak). Currently trading around 1.0980.
• GBP is stronger vs. the USD and to a lesser extent the EUR. Little follow-through into the pound was seen after a broadly in-line UK retail sales print. Currently trading near session highs at around 1.289.
• JPY is firmer vs. the USD with the Yen attempting to claw back some of the damage done by yesterday's US retail sales report. Thus far, USD/JPY has been as low as 148.61.
• NZD/USD is attempting to claw back lost ground seen in the wake of this week's RBNZ rate cut and dovish commentary from Governor Orr. AUD/USD is extending its rise on a 0.66 handle and moved back above its 200 and 100DMAs at 0.6601 and 0.6605 respectively.
• PBoC set USD/CNY mid-point at 7.1464 vs exp. 7.1739 (prev. 7.1399).
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FIXED INCOME

• USTs have climbed slightly above 113-00, as the complex received a modest bid in recent trade. Docket features Building Permits/Housing Starts, Uni. of Michigan prelim. and remarks from Fed's Goolsbee.
• Bunds are contained as benchmarks generally hold around the post-Retail Sales/IJC lows seen on Thursday. In a thin 25 tick band which is entirely within yesterday's much wider 134.08-135.07 range.
• Gilts are incrementally firmer with the narrative in-fitting with EGBs. No move in Gilts or BoE pricing after an in-line set of Retail data. Currently holding shy of 100.00 in 99.86-100.08 parameters.
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COMMODITIES

• Crude is lower in a paring to the prior day's gains. This morning's price action has been contained to within yesterday's range, although some downticks coincided with reports that Libya's Waha oil field is to return to full normal levels within the coming hours after production was reduced amid a fire. Brent Oct at the foot of an 80.02-81.02/bbl parameter.
• Mixed trade across precious metals, with the gains in spot gold and spot palladium modest at the time of writing, while spot silver resides in the red as it gives back some of the gains following yesterday's upside in which the metal soared some 3%. Spot gold sits in the green after finding support at USD 2,450/oz (vs high USD 2,464.57/oz).
• Modest losses across base metals following yesterday's surge fuelled by the US data deluge which ultimately pointed to a more balanced economy.
• Qatar lowered its October Al Shaheen crude term price to USD 0.87/bbl above Dubai quotes from a previous premium of USD 1.88/bbl in September.
• China July Crude Iron Ore Output -20.9% Y/Y at 70.22mln metric tons; Alumina +3.9% Y/Y at 7.21mln; Refined Copper +7% Y/Y at 1.1mln; Lead +1.1% Y/Y; Zinc +0.9% Y/Y.
• Libya's Waha Oil Company says it is expecting to return to normal level within the coming hours; it has finished maintenance and pumping started from field to ES-Sider port (250k BPD capacity).
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NOTABLE DATA RECAP

• UK Retail Sales MM (Jul) 0.5% vs. Exp. 0.5% (Prev. -1.2%, Rev. -0.9%); Retail Sales Ex-Fuel YY (Jul) 1.4% vs. Exp. 1.4% (Prev. -0.8%); Retail Sales Ex-Fuel MM (Jul) 0.7% vs. Exp. 0.8% (Prev. -1.5%, Rev. -1.3%); YY (Jul) 1.4% vs. Exp. 1.4% (Prev. -0.2%, Rev. -0.3%)
• EU Eurostat Trade NSA, Eur (Jun) 22.3B EU (Prev. 13.9B EU)

NOTABLE EUROPEAN HEADLINES

• EU's Vestager will not return for a third term as the EU's top antitrust official with the Danish government preparing to nominate a different candidate as their EU commissioner, according to FT.

NOTABLE US HEADLINES

• Fed Chair Powell is to speak on August 23rd at 10:00EDT/15:00BST at the Kansas City Fed's Jackson Hole Symposium.
• Atlanta Fed GDPnow (Q3): 2.4% (prev. 2.9%) following the retail trade, industrial production, and import/export prices data.
• US VP Harris is to call for the construction of 3mln new housing units and tax incentives to build homes for first-time buyers, according to WSJ.
• Texas Instruments (TXN) signs prelim agreement to receive up to USD 1.6bln in Chips and Science act proposed funding for semiconductor manufacturing in Texas and Utah

GEOPOLITICS

MIDDLE EAST

• US official said mediators concluded a 'constructive day' of discussions on Gaza ceasefire and talks are to continue on Friday, according to Reuters. It was separately reported that there is a high probability the Doha negotiations will continue until Saturday, according to Al Arabiya citing an Israeli official.
• US assessments are that Iran will not seek to disrupt ongoing cease-fire negotiations in Doha aimed at ending the Hamas-Israel war and technical talks could stretch into the weekend, but it is unclear how long Iran and its proxies may hold off, according to CBS.
• UK Foreign Minister Lammy is set to travel to Israel "in an attempt to prevent an all-out war in the Middle East", according to Sky News citing a diplomatic source.
• US CENTCOM said its forces “successfully destroyed one Iranian-backed Houthi ground control station in a Houthi-controlled area of Yemen” over the past 24 hours, according to Iran International.
• Hezbollah has said that the counterattack will not occur during talks with Qatar, via Kann's Kais citing the Washington Post; "The response can wait, it is not urgent and has no time limit.".

OTHER

• Russian President Putin's aide said the attack on Kursk was planned with the participation of NATO and Western intelligence, and Ukraine would not have attacked Kursk without US support, according to Al Arabiya
• North Korean leader Kim said in a message to Russian President Putin that Russia will be victorious in a "sacred war" for peace and justice, while he added that the two countries will promote building a multi-polarised new world, according to KCNA. Furthermore, Russian President Putin reaffirmed a commitment to implement a strategic partnership agreement, in a message to- NYSE has withdrawn a proposed rule change application to list and trade options based on the Bitwise Bitcoin ETF and the Grayscale Bitcoin Trust, via CoinDesk citing an SEC filing North Korean leader Kim.

CRYPTO

• Bitcoin continues to advance and holds firmly above USD 58k, with Ethereum also heading higher and above USD 2.6k.
• NYSE has withdrawn a proposed rule change application to list and trade options based on the Bitwise Bitcoin ETF and the Grayscale Bitcoin Trust, via CoinDesk citing an SEC filing.

APAC TRADE

• APAC stocks followed suit to the rally on Wall St after a US data deluge soothed recent economic concerns.
• ASX 200 gained as the commodity-related sectors spearheaded the advances seen across all industries.
• Nikkei 225 outperformed and surged firmly above the 37,000 level following recent currency weakness.
• Hang Seng and Shanghai Comp. were positive with JD.com, MTR, Li Ning and Alibaba among the biggest gainers in Hong Kong post-earnings, while the mainland index continued to lag amid lingering economic concerns.

NOTABLE ASIA-PAC HEADLINES

• RBA Governor Bullock said the board is of the view that it currently has the balance right between reducing inflation in a reasonable timeframe and noted their full employment goal is not served by letting inflation stay above target indefinitely. Bullock said based on what the board knows at present, it does not expect that it will be in a position to cut rates in the near term and the board’s message is that it is premature to be thinking about rate cuts, while she added that although goods price inflation has declined substantially, it has not been enough to offset continued high services price inflation. Furthermore, Bullock said the government and RBA are in complete agreement regarding inflation reduction and stated that public demand is currently not the main priority.
• RBNZ Governor Orr said the committee has achieved a very strong level of confidence that low and stable inflation is back within 1% and 3%, while he wants to see inflation expectations and pricing intentions continue to remain anchored.

DATA RECAP

• Singapore Non-Oil Exports MM (Jul) 12.2% vs. Exp. 2.2% (Prev. -0.4%); Non-Oil Exports YY (Jul) 15.7% vs. Exp. 1.2% (Prev. -8.7%)