• French PM Bayrou lost the confidence vote in the National Assembly, as expected; French President Macron said he will name a new PM in the coming days.
• UK Chancellor Reeves is to tell ministers to prioritise the fight against inflation in a Cabinet meeting today, according to FT.
• US Senate Banking panel to vote on Miran's Fed nomination on September 10th, according to Bloomberg.
• European equity futures indicate a marginally lower cash market open with Euro Stoxx 50 futures down 0.4% after the cash market closed with gains of 0.8% on Monday.
• Looking ahead, highlights include French Industrial Output, US NFP Prelim. Benchmark Revisions, Apple Event, Comments from BoE's Breeden, Supply from Netherlands, UK, Germany & US.
• Click for the Newsquawk Week Ahead.

US TRADE

EQUITIES

• US stocks notched marginal gains with outperformance seen in the Nasdaq 100 thanks to strength in the Tech and Consumer Discretionary sectors. On the flipside, Utilities, Real Estate and Consumer Staples underperformed while overall breadth was weak.
• Equities were bid at the open but were pressured during the last few hours of trade despite little fresh news driving price action, with participants still cognizant of the soft labour market report seen last Friday as they look ahead to inflation data this week.
• SPX +0.21% at 6,495, NDX +0.46% at 23,762, DJI +0.25% at 45,515, RUT +0.16% at 2,395.
• Click here for a detailed summary.

TARIFFS/TRADE

• NVIDIA (NVDA) said they have received several H20 licenses for their key customers in China, via the GS conference.
• US FCC launched proceedings to withdraw recognition from seven Chinese test labs, citing national security concerns.
• Japan's trade negotiator Akazawa said US tariffs on Japanese goods, including cars, will be lowered by September 16th, according to Reuters citing a post on X. However, Akazawa later commented that tariff discussions with the US are not fully resolved and that Japan must ensure the trade deal is carried out.
• South Korea and the US are to resume working-level talks regarding tariffs, according to Yonhap
• South Korea's presidential adviser said US trade negotiations are being delayed due to the issue of FX market impacts from the USD 350bln package and have asked the US to help find a solution to the capital market impact, while they told the US that they can't agree on terms similar to Japan's USD 550bln deal.

NOTABLE HEADLINES

• US Senate Banking panel to vote on Miran's Fed nomination on September 10th, according to Bloomberg.
• White House is preparing a report critical on the Bureau of Labor Statistics, according to WSJ

APAC TRADE

EQUITIES

• APAC stocks traded mixed as the region failed to fully sustain the mildly positive handover from Wall St, with price action contained amid light fresh catalysts and as participants looked ahead to upcoming events, including inflation data scheduled in the next couple of days.
• ASX 200 was dragged lower with notable weakness in Energy, Industrials, Real Estate and Financials, with sentiment also not helped by a deterioration in consumer confidence and mixed business surveys.
• Nikkei 225 initially rallied above the 44,000 levels to print a fresh record high, but then gradually faded its gains as political uncertainty lingered.
• Hang Seng and Shanghai Comp were mixed with the Hong Kong benchmark led higher by outperformance in real estate and tech, with the former helped as China's MIIT pledged to accelerate breakthroughs in high-performance chip technology. Conversely, the mainland lagged amid lingering global frictions with EU officials reportedly discussing potential sanctions on China and other parties for the purchase of Russian energy, while Chinese President Xi recently took aim at a 'certain country' increasing trade war risks.
• US equity futures remained afloat after recent gains but with upside capped by a lack of fresh catalysts and with participants awaiting data and today's Apple event.
• European equity futures indicate a marginally lower cash market open with Euro Stoxx 50 futures down 0.4% after the cash market closed with gains of 0.8% on Monday.

FX

• DXY was little changed but got some slight reprieve after declining yesterday in an extension of post-NFP selling and as longer-dated US yields retreated, while recent key updates included President Trump announcing his final three picks to replace Fed Chair Powell, including Former Fed Governor Warsh, current Fed Governor Waller, and NEC Director Hassett. Furthermore, the attention now turns to data releases including the BLS prelim. benchmark revisions scheduled today, followed by PPI on Wednesday and CPI on Thursday.
• EUR/USD marginally extended on advances after having benefitted from a softer dollar and despite the confidence vote in France, which PM Bayrou lost in a landslide as expected, while President Macron is to name a new PM in the coming days, which may come after the September 10th strikes.
• GBP/USD gained a firmer footing at the 1.3500 handle after G10 currencies generally took advantage of recent dollar selling, but with further upside limited amid light catalysts.
• USD/JPY trickled further beneath the 148.00 handle after fully reversing the recent Ishiba-triggered surge.
• Antipodeans kept afloat after a firmer PBoC reference rate setting, but with gains capped following weaker Australian consumer sentiment and mixed business surveys.
• Norway's Labour Party government won re-election backed by four smaller parties, according to official results.

FIXED INCOME

• 10yr UST futures took a breather after yesterday's upward momentum and curve flattening as US President Trump narrowed the Fed Chair picks to three, and with eyes turning to the BLS prelim. benchmark revisions, CPI/PPI data and looming supply.
• Bund futures slightly pulled back after recent advances and with demand contained heading into a total of EUR 4bln of Bund issuances spread over two days.
• 10yr JGB futures remained lacklustre amid little fresh drivers and in the absence of tier-1 data, while political uncertainty lingered.

COMMODITIES

• Crude futures edged higher in rangebound trade after the prior day's fluctuations, whereby early gains due to OPEC+ and geopolitics were trimmed after Saudi Arabia lowered premiums for OSPs to Asia and North-West Europe.
• Spot gold steadily extended on advances and printed a fresh record high following recent dollar weakness.
• Copper futures lacked firm direction with the price action contained within a tight range after the indecisive performance on Monday.

CRYPTO

• Bitcoin saw two-way price action with early pressure on a dip below the USD 112k level before gradually paring most of the losses in the latter half of the session.

NOTABLE ASIA-PAC HEADLINES

• China's Ministry of Industry and Information Technology said in a briefing that China is to accelerate breakthroughs in high-performance chip technology and will guide 10-gigabit optical networks from pilot testing to deployment.
• Japanese Finance Minister Kato said he will carefully consider the possibility when asked about entering the LDP leadership race, while he noted that Japan's economy is showing bright signs, but there is a need to support those suffering from rising prices, including food prices.
• Japanese LDP politician Kono reiterated that if the BoJ delays rate hikes, it would boost inflation, and noted they need to fix a weak yen, so the BoJ needs to hike rates, while he added that a sales tax cut would increase the deficit, and said he is 'sleeping on' whether to run for LDP leadership.

DATA RECAP

• Australian Consumer Sentiment (Sep) -3.1% (Prev. 5.7%)
• Australian NAB Business Confidence (Aug) 4.0 (Prev. 7.0, Rev. 8)
• Australian NAB Business Conditions (Aug) 7.0 (Prev. 5.0)

GEOPOLITICS

MIDDLE EAST

• Israeli PM Netanyahu warned Gaza residents to leave now, with forces organising and assembling in Gaza City for a ground manoeuvre.
• Israel conducted strikes in the vicinity of Syria's Homs, Palmyra and Latakia cities.
• Downing Street spokesperson said Palestinian President Abbas welcomed UK PM Starmer's pledge to recognise a Palestinian state ahead of the UN General Assembly meeting later this month.
• Iran’s Foreign Minister and IAEA Chief Grossi are set to meet on Tuesday, but the meeting remains contingent on being close enough to reach an access deal there, according to WSJ's Norman.

RUSSIA-UKRAINE

• Ukraine is at risk of a shortage of air defence weapons after a US DoD review of military aid resulted in slower deliveries, according to officials cited by FT.
• Ukrainian President Chief of Staff discussed Russian strikes with US Secretary of State Rubio and said a government building was hit on Saturday by a Russian ballistic missile.

OTHER

• North Korea's leader Kim observed solid fuel engine tests and said it marks an important change to the nuclear force.
• Chinese President Xi sent congratulations to North Korea's Kim on the founding anniversary, while it was separately reported that President Xi said China is ready to enhance strategic communication and maintain close cooperation with North Korea for regional and world peace, and development, according to Xinhua.

EU/UK

NOTABLE HEADLINES

• UK Chancellor Reeves is to tell ministers to prioritise the fight against inflation in a Cabinet meeting today, according to FT.
• Barclays UK August Consumer Spending rose 0.5% Y/Y vs prev. 1.4% Y/Y increase in July.
• French PM Bayrou lost the confidence vote in the National Assembly, as expected, while it was separately reported that ousted French PM Bayrou will submit his resignation to President Macron on Tuesday morning, and French President Macron said he will name a new PM in the coming days.
• ECB Villeroy said they are in a good position with inflation in Europe.

DATA RECAP

• UK BRC Retail Sales YY (Aug) 2.9% (Prev. 1.8%)
• UK BRC Total Sales YY (Aug) 3.1% (Prev. 2.5%)