Our websites use cookies to offer you a better browsing experience by enabling, optimising, and analysing site operations, as well as to provide personalised ad content and allow you to connect to social media. By choosing “Accept all” you consent to the use of cookies and the related processing of personal data. Select “Manage consent” to manage your consent preferences. You can change your preferences or retract your consent at any time via the cookie policy page. Please view our cookie policy and our privacy policy.
Macro: Risk sentiment falters on geopolitical tensions and new modern high in US 30-year yield
Equities: US and European equities slipped as oil and yields rose, Asia turned mixed as Korean chip strength met broader risk-off pressure.
Volatility: Near-term protection was bid back off the floor as energy and rate volatility climbed
Digital Assets: Listed crypto proxies rallied hard while the underlying majors drifted quietly sideways
Commodities: Gold holds despite yield rise, crude firmer on Middle East risk and scarcity keeps copper bid.
Fixed Income: Global bond markets under pressure on higher energy prices, although auction of 5-year JGB’s drew strong demand.
Currencies: USD weakness reverses as global risk sentiment softens.
Macro
Australia's Aug. Westpac Consumer Confidence rose to 88.9, a five-month high and up from 83.9 in July after scraping near the multi-year lows in April through June.
US President Trump said he is not interested in extending the 60-day ceasefire deal that technically expired Monday. He repeated the idea of making the Strait of Hormuz a US Territory.
Canada’s headline inflation rose to 2.9% in July from 2.8% in June, still below the 3.2% post-Iran-war peak. Gasoline inflation climbed to 25.7% on renewed Iran–US tensions. Core inflation inched up (median 2.0%, trimmed 1.9%), with World Cup–driven travel costs surging, while food and shelter inflation eased. Month over month, prices gained 0.5% after a 0.4% decline.
The NAHB/Wells Fargo Housing Market Index fell to 25 in August 2026 from 34 in July, defying expectations for 33. Current sales conditions rose two points to 39, and sales expectations stayed at 43. Price cuts were reported by 35% of builders (down two points), averaging 6%.
The Empire State Manufacturing Index rose to 20.6 in August from 15.6, far above expectations and the strongest since late 2021. New orders and shipments increased, delivery times lengthened, and inventories fell amid worsening supply conditions. Employment edged up, input costs rose, and selling prices stayed elevated, while firms remained optimistic despite modest capex plans.
Thursday: Walmart, Deere & Company, Ross Stores, Netease, Fortescue, Novonesis
For all macro, earnings, and dividend events check Saxo’s calendar.
Equities
USA: The S&P 500 fell 0.5% to 7,745.06, the Dow lost 0.5%, and the Nasdaq 100 slipped 0.2% as higher oil prices and long-term Treasury yields pressured risk appetite. Microsoft dropped 3.0% and Meta 3.5% as higher yields weighed on large growth stocks, while Constellation Brands fell 6.2% after Berkshire Hathaway disclosed it had exited the position. Chips bucked the weakness, with Micron up 4.1% as US trade policy signalled resistance to Apple sourcing memory from China. Investors now turn to Home Depot and Walmart for a fresh read on the US consumer.
Europe: The Stoxx 600 fell 0.2% to 656.41 and the FTSE 100 lost 0.3% to 10,720.30 as geopolitical tension and rising oil prices cooled risk appetite. Argenx jumped 17.1% after its drug met the primary endpoint in a Phase 3 autoimmune myositis study, while SIG Group slumped 17.6% after an unexpected chief executive change. Consumer names were weak, with LVMH down 2.7% and Kering 4.3% lower as luxury stocks retreated broadly. With earnings largely behind Europe, attention is shifting back toward September central-bank decisions and the inflation implications of higher energy prices.
Asia: Markets turned lower through Tuesday’s session as the US-Iran truce expired, oil stayed above $90 and bond yields climbed. Japan’s Nikkei 225 fell around 1.8% and the Hang Seng lost 0.6%, while South Korea’s Kospi gave back an early gain of more than 3% and moved into negative territory after reopening from Monday’s holiday. SK Hynix and Samsung Electronics initially rallied with the global chip trade before gains faded as risk appetite weakened. Geely remained in focus after strong first-half results and a leadership reshuffle, while Xiaomi reports today, with investors watching electric-vehicle momentum and input costs.
Protection was bid back off the floor as crude firmed and the 30-year yield reached a 19-year high. VIX rose 6.60% to 15.19 and VIX9D jumped 16.78% to 12.39, while VVIX added 7.36% to 93.92. Same-day VIX1D went the other way, down 9.37% to 8.32.
The cash curve stays in contango, 15.19 spot against 19.04 at three months and 23.04 at one year, the front future at 18.15. SKEW reached 142.91, MOVE jumped 8.70% to 75.63 and oil vol hit 52.92. SPX options imply 0.37% today and 0.83% into Friday, with the FOMC minutes Wednesday.
For a more detailed view on volatility, check our Options Briefs in the Options Insights
Digital Assets
The listed proxies did the work while the majors drifted. Strategy rose 4.99%, Marathon 5.60%, Riot 5.39% and Cipher 3.61%, with Circle up 4.18% and Coinbase 1.40%, against spot bitcoin and ether both easing overnight. DVOL slipped to 34.49.
Strategy paid USD 52.4 million of dividends on its STRC preferred and then spent USD 132.2 million buying that stock back, leaving its bitcoin reserve unchanged near 840,000 coins for a further week.
Commodities
Oil: Crude firmed again, with Brent reaching a two-week high above USD 91 after Trump rejected extending the US-Iran agreement, while new attacks on vessels were reported in the Strait of Hormuz and fighting resumed in Lebanon. Together, these developments have further dimmed prospects for a near-term resolution of the 6½-month-long US/Israel-Iran war. The US continues to signal that it intends to use sustained economic pressure to force Tehran into accepting its demands.
Precious metals: Spot gold traded near USD 4,400, having steadied after gaining 1.5% over the previous two sessions. The metal is up more than 11% over the past month, its strongest 22-session advance since early February, supported by a softer dollar, fading Fed rate-hike expectations and continued demand from central banks. Investor concerns about the US fiscal and debt outlook are also providing support, particularly as long-end Treasury yields continue to rise.
Broad commodities: The BCOM TR index has now rebounded 13% from its late-June correction low and trades just 3.2% below the record high reached in May. Notably, the recovery has been broad-based, with all major sectors except industrial metals, up 7%, recording double-digit gains from the correction low. Energy and soft commodities lead with gains of more than 19%, followed by grains at 12% and precious metals at 10%. At the individual commodity level, natural gas is the only contract trading lower over the period, while the strongest gains have been seen in diesel, crude oil, coffee, gasoline and sugar.
The benchmark US 30-year Treasury yield hit a fresh 19-year high above 5.30% Monday (up five basis points from Friday’s close) as the US yield curve steepened. Higher oil prices on the ongoing tensions in the Middle East combined with some recent soft US economic numbers suggest stagflationary concerns. The benchmark 10-year Treasury yield was also higher, but has yet to threaten above the recent cycle high just below 4.75%, trading near 4.73% early Tuesday. At the front end of the curve, the benchmark US 2-year yield remained rangebound, slightly higher from Friday near 4.19%.
The yield on the 10-year Japanese government bond rose to a new multi-decade high, trading nearly as high as 2.97% intraday before dropping back, as a strong 5-year JGB auction Tuesday brought relief for the JGB market.
Currencies
The US dollar weakened further on Monday before finding support as global risk sentiment faltered on rising oil prices and rising US long Treasury yields. EURUSD traded as high as 1.1614 Monday but was trading near 1.1570 early Tuesday. AUDUSD only fell back slightly on Tuesday, trading above 0.7100 after a 0.7129 high on Monday.
USDJPY nudged to a new high above 159.60, eyeing the psychological 160.00 level again and the risk of renewed official Japanese intervention to prevent further JPY weakness. Pressuring the yen are the latest rise in crude oil prices and global bond yields.
This content is marketing material and should not be regarded as investment advice. Trading financial instruments carries risks and historic performance is not a guarantee of future results. The instrument(s) referenced in this content may be issued by a partner, from whom Saxo receives promotional fees, payment or retrocessions. While Saxo may receive compensation from these partnerships, all content is created with the aim of providing clients with valuable information and options..
Share
Outrageous Predictions 2026
01/
Outrageous Predictions
Carry trade unwind brings USD/JPY to 100 and Japan’s next asset bubble
Charu Chanana
Chief Investment Strategist
A Trump-driven Fed pivot crashes the carry trade, hurling USD/JPY to 100 and unleashing Japan’s wild...
The Saxo Group entities each provide execution-only service, and access to analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Inspiration Disclaimer and (v) Notices applying to Trade Inspiration, Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular, no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.
None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Markets or its affiliates.