Asia Market Quick Take – 4 August, 2026

Key points:

• Macro: US-Iran in talks again to reopen Straits of Hormuz
• Equities: S&P 500 +1.5% just 0.1% of new highs; Palantir +15% after ‘otherworldly’ sales
• FX: USDJPY dips on joint intervention, while GBP and CHF soften
• Commodities: WTI crude remains near $80 while precious metals trade sideways
• Fixed income: Treasuries rallied across the curve, best week-start in 2+ months

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Disclaimer: Past performance does not indicate future performance.

Macro:

• Iran said talks to restore shipping through the Strait of Hormuz were progressing after US President Donald Trump called off a major planned attack on the country.
• US construction spending fell 0.1% in June 2026 to an annualized $2.17 trillion, missing expectations, as residential declined and nonresidential edged up. First-half 2026 spending was down 3.5% year-over-year.
• The US ISM Manufacturing PMI rose to 55.6 in July 2026 from 53.3, topping forecasts and marking the strongest expansion since May 2022, driven by faster output, solid new orders, and a return to job growth, as firms front-loaded orders amid geopolitical risks and AI-related investment offset tariff impacts.
• The S&P Global US Manufacturing PMI was revised up to 53.9 in July 2026, matching June and marking a 12th month of expansion, though momentum softened, with slower output and new orders, weaker exports, ongoing supply disruptions, and still-elevated costs and prices as business confidence eased.
• Swiss CPI rose 0.4% year-on-year in July 2026, the weakest since March, down from 0.5% in June, as food, clothing, and household goods fell further and transport inflation eased. Month-on-month, prices slipped 0.1%, and core inflation was unchanged at 0.3%.
• Germany’s retail sales fell 1.1% month-on-month in June 2026, the sharpest drop since May 2025, with food and non-food down and online sales up 0.4%. Year-on-year, sales slipped 0.2%.

Equities: 

• US — The S&P 500 closed Monday up 1.5% to 7,600.50, within 0.1% of its all-time high, while the Nasdaq 100 gained 1.8%. The rally was driven by easing Middle East tensions and strong AI-related earnings. Microsoft led the S&P 500 with a 4.9% gain; Meta surged 6.7%, Alphabet +5.2%, and Amazon +4.6% after crossing a $3 trillion market cap for the first time. First Solar was the session's top individual mover, up 10.3%. Apple was the lone Mag-7 laggard, slipping 0.5%. After hours, Palantir Technologies gained 15% after raising its revenue and income forecasts. Snap also beat Q2 revenue estimates and guided Q3 in line.
• EU — European equities advanced broadly on Monday, buoyed by falling oil prices and positive AI-earnings momentum. The DAX rose 1.5% to 26,001, hitting a fresh intraday record. The CAC 40 gained 1.6% to its first intraday record since 26 February. The Euro Stoxx 50 also hit a fresh peak. The Stoxx 600 added 0.4% to 652.09, just shy of its closing record. SAP led the Stoxx 600 with a 4.4% gain. AstraZeneca was the notable laggard on the FTSE 100, falling 9.0%. UK homebuilders surged up to 6.5% as markets pared Bank of England rate-hike bets on lower oil.
• Asia — Asian equities opened Tuesday on a positive note, tracking Wall Street's rally, though gains were tempered by ongoing semiconductor volatility. South Korea's Kospi opened up ~1.5–2.1%, rebounding after SK Hynix tumbled over 11% on Monday amid extreme chip-sector volatility; Samsung and SK Hynix were both firmer in pre-market. The Nasdaq Golden Dragon China Index rose 0.8% on Monday. China's Securities Daily reported the PBOC has room for further RRR and interest rate cuts this year. MSCI Asia ex-Japan futures pointed to a mixed open, with US hyperscaler strength providing a tailwind but chip names keeping gains in check.

Earnings this week:

• Tuesday: SpaceX, McDonald's, Booking, AMD, Pfizer, HSBC, Toyota
• Wednesday: Walt Disney, Uber, Shopify, SanDisk, Eli Lilly, Novo Nordisk, Block, Honda
• Thursday: Molson Coors, Monster Beverage, Warner Bros Discovery, Airbnb, SoftBank Group, DBS, Nintendo, Orix
• Friday: OCBC

FX:

• USDJPY briefly dropped into the 156 handle on Monday after confirmed joint US‑Japan intervention, with the yen nearing its May peak around 155.04 before the pair settled near 156.96 in late New York; Japan’s Finance Ministry is estimated to have spent roughly $34 billion on Friday alone, and Bessent and Katayama warned of further coordinated action.
• GBPUSD led G10 losses, dropping 0.37% to 1.3433, while USDCHF saw the largest dollar gain, up 0.33% to 0.8102 amid some safe-haven franc selling.
• AUDUSD slipped 0.27% to the key 0.7000 level, with all major pairs trading within a relatively tight ±0.40% daily range.
• The yuan was marginally weaker, with USDCNH at 6.7583 after a slightly weaker PBOC fixing at 6.7898.

Commodities:

• Brent for October fell as much as 7.3% to $81.55 a barrel on Monday — its biggest single-day drop in weeks — after Trump called off the planned Iran strike and announced fresh talks. WTI settled near $80 a barrel. Oil held losses in early Asian trade Tuesday as Trump described the offer as Iran's "last chance" and said he expects a full reopening of the Strait of Hormuz.
• Gold rose alongside Treasuries on Monday as the oil-driven inflation relief and Middle East de-escalation prompted a flight into safe havens and bonds. The metal benefited from the softer dollar and easing real yield pressure.
• LME copper cash-to-three-month spread rose sharply by $28.87 to $73.57 per tonne on Monday, the highest level since 20 January, signalling tightening near-term physical supply conditions.

Fixed income:

• Treasuries climbed across the curve as falling oil prices eased inflation concerns. The 10-year yield fell 4.8 basis points to 4.688%, the 2-year fell 5 basis points to 4.25%, and the 30-year declined 4.4 basis points to 5.231%. This was the best start to a week for Treasuries in more than two months, though the 30-year remains near levels last seen in 2007 after July's brutal selloff.
• Treasury lifted Q3 net borrowing to $739B (+$68B); dealers still see no coupon hikes in refunding. JPM raised year-end 10y/30y yield targets on Fed-credibility doubts after Chair Warsh; a block bought $9.5M Nov long-bond puts targeting 5.5% 30y yields.
• US‑Japan FX move raised fears of Japanese U.S. Treasury sales, but FIMA repo use should curb outright selling (Bessent, MUFG). Monday’s 3‑ & 6‑mo bill auctions were soft; indirects at lows since late June amid policy uncertainty.

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