Asia Market Quick Take – 24 August, 2026

Asia Market Quick Take – 24 August, 2026 

Key points:  

• Macro: US expected to sanction Iran. US-Canada trade talks fail. 
• Equities: S&P 500 snap winning streak; Robinhood +13% on crypto rally 
• FX: Dollar slumps as Treasury buyback pledge lifts commodity and EM currencies broadly 
• Commodities: Gold stay above $4,600, extending a three-week rally 
• Fixed income: Treasury yields remain elevated as 10 year near 4.74% 

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Disclaimer: Past performance does not indicate future performance.  

 Macro: 

• US Treasury Secretary Scott Bessent vowed the “toughest” sanctions in history, aiming to intensify economic pressure on Iran and its trading partners. The move could further tighten global oil supplies, with Iranian exports already disrupted and offers to China reduced. Tehran dismissed the threat, saying it can withstand sanctions and maintain trade elsewhere, while tensions in the Strait of Hormuz remain high and traffic is still below normal
• US–Canada trade talks collapsed Friday, partly over US tariffs on Canadian medium and heavy-duty vehicles. The 50% US tariffs on some Canadian goods have now taken effect, and Canadian PM Carney vowed to match them on US goods from September 8.
• The US flash S&P Global Composite PMI rose to 56 in August 2026 from 54.5 in July, the strongest since April 2022. Faster services growth offset softer manufacturing, where output rose at the weakest pace in 13 months amid supply issues. Backlogs increased as delivery times lengthened. Hiring grew at the fastest rate since early 2025 and confidence hit a nine‑month high. Selling price pressures eased, though input costs remained elevated on higher energy prices.
• Canadian retail sales are expected to fall 0.8% m/m in July, the sharpest drop in ten months, reversing June’s revised 0.6% gain. Sales rose for general merchandise, clothing-related stores, and motor vehicle and parts dealers, but fell 4.1% at gasoline stations as lower fuel prices offset higher volumes. Turnover was up 5.2% from a year earlier.
• Euro Area 12‑month inflation expectations fell to 2.9% in July 2026 from 3.0% in June; three‑year expectations dipped to 2.7%, and the five‑year outlook stayed at 2.4%. Uncertainty remained high, with lower‑income and older households expecting higher inflation than richer and younger groups. Expected income growth slipped to 1%, spending stayed at 3.6%, and expected GDP growth improved to -1.2%. Lower‑income households saw faster home‑price gains (4%) than higher‑income ones (3.1%).
• UK retail sales volumes fell 0.5% m/m in July 2026 after a revised 0.7% rise in June, the first decline since April. Non‑food store sales dropped 1.3% on weaker clothing and household goods, and non‑store sales also fell after strong promotion‑driven gains in prior months. Food store sales rose 0.5%, supported by hot weather and the World Cup. Annual growth slowed to 1.6% from 3.8% in June.

Equities:  

• US — S&P 500 snapped a three-week winning streak last week, dragged lower by a surge in the 30-year Treasury yield to 5.34% — a 19-year high — before partially recovering on Friday. The VIX closed the week at 15.13, up 6.2% week-on-week. US steel stocks including Nucor and Steel Dynamics rallied on the collapse of US-Canada trade talks. Robinhood surged 13% on Thursday, the best performer in the S&P 500 that day on crypto moves. Moderna jumped over 15% on Friday, extending a remarkable week-to-date gain of over 143%. Target rallied 4.5% on Friday after earnings doubled. Heading into this week, Nasdaq 100 futures are edging up 0.1% as Nvidia earnings on Wednesday dominate the agenda.
• EU — The Stoxx Europe 600 slipped 0.6% last week to 654 points, its second consecutive weekly decline, at one point logging its longest daily losing streak since September 2023 before a Friday rebound. The DAX fell 1.1% on the week, while the CAC 40 dropped 1.76% — its largest weekly decline since July 10. The FTSE 100 rose 0.6% on Friday (Aug 21) to 10,816, led by HSBC (+1.1%) and JD Sports (+5.6%). A notable deal: Monte dei Paschi di Siena launched all-share bids for Banco BPM and Banca Generali, valued together at approximately €34 billion (~$40 billion), in a move to create a major Italian banking group with a ~€70 billion market cap.
• Asia — Asian equities are edging lower this Monday morning, with the MSCI Asia Pacific gauge down 0.1%. The Kospi is the notable underperformer, falling 1.2% as the AI-sensitive index digests the upcoming Nvidia earnings and broader chip sector caution. Hang Seng faces early headwinds as investors digest an announcement from Alibaba to raise US$10b to fund AI spending — the index's third-largest constituent — though a rebound is expected given the AI rotation trade supporting the market. Last week, Korean chip stocks bore the brunt of the global bond selloff, with Samsung Electronics and SK Hynix each slumping more than 8% at their lows on Wednesday (Aug 19). Singapore's STI has been a relative outperformer, having surged approximately 23% over the past month on a "Goldilocks" economic backdrop of robust tech exports and contained inflation. Vietnam's Vingroup and over 100 Vietnamese companies were added to FTSE Russell's Global Equity Indexes on Friday, marking the country's transition to secondary emerging market status.

Earnings this week: 

• Monday (24 Aug) - Xpeng, PDD Holdings
• Tuesday (25 Aug) — Intuit, Zoom
• Wednesday (26 Aug) — Nvidia, Salesforce, CrowdStrike, HP, Haidilao, Li Auto
• Thursday (27 Aug) — Marvell, IREN, Affirm
• Friday (28 Aug) — BYD Electronic, China Construction Bank, ICBC, Agricultural Bank of China, Bank of China

FX: 

• The USD extended its decline on Friday, with the Bloomberg Dollar Spot Index slipping 0.2% on the day and 0.8% over the week to a three‑month low, its weakest August week. Selling was sparked by US Treasury Secretary Scott Bessent’s pledge to at least double buybacks of longer‑dated bonds to cap yields, drawing comparisons to Japan’s yield‑curve control and raising concerns about the dollar’s reliability as a hedge.
• AUDUSD rose 0.80% to 0.7171 and NZDUSD gained 0.59% to 0.5978, in line with CFTC data showing increased AUD longs and reduced NZD shorts.
• CHF was the strongest G10 currency on the week (up 1.65% vs USD) even though USDCHF ticked slightly higher on the day to 0.8012, while JPY was the weakest G10 performer on the week, with USDJPY edging down only 0.06% on the day to 158.95 as hedge funds rebuilt shorts.
• EUR lagged, with EURUSD essentially flat at 1.1679 despite broad dollar weakness, consistent with sizable leveraged‑fund net EUR shorts.
• KRW was the top Asian performer, dropping 1% intraday against the USD on shareholder‑return plans from local chipmakers.

Commodities: 

• Gold climbed above $4,620, building on a third consecutive weekly gain and rising more than 5% last week after the Treasury's surprise ramp-up in buybacks of long-dated government debt revived concerns about a weaker dollar and pushed investors toward alternatives.
• Oil slipped after a two-week rally as traders awaited the US plan to economically isolate Iran due later Monday, with Brent falling toward $93 after about 13% gains and WTI near $86, as Treasury Secretary Scott Bessent prepares to unveil details and press allies to join.
• LME copper's spot price traded as much as $545 per metric ton above the three-month futures contract on 17 August — the widest backwardation since a historic squeeze in 2021 — as near-term supply tightness in the LME warehouse network intensified.

Fixed income:  

• The 30-year US Treasury yield touched 5.34% last week — the highest since 2007 — driven by fiscal concerns, a flood of long-dated supply and sticky inflation. The Treasury responded by announcing plans to at least double the size of liquidity support buyback operations for longer-dated securities. The 30-year bond auction on 13 August cleared at 5.216%, the highest yield since 2001. The 30-year TIPS auction on 20 August cleared at 2.973%, up from 2.473% in February, with strong demand (bid-to-cover 2.82).
• The 10-year yield traded around 4.70% on Friday 21 August. Bessent's "Treasury twist" — buying back long-dated debt while issuing more short-dated securities — has drawn comparisons to the Fed's 1960s Operation Twist and the 2011 deployment. BofA's Hartnett warned that if Bessent cannot drag the 30-year yield below 5%, he foresees a dollar slump and increased short bets against leveraged risk assets including AI hyperscalers and private credit. All eyes are on Warsh's Jackson Hole speech Friday for policy direction.
• The inexorable rise in long-term government bond yields is spreading globally. Japanese 30-year yields rose above 4% for the first time in their 27-year history earlier this year, while equivalent UK gilts hit their highest since 1998.

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