• APAC stocks traded mostly lower after the early reprieve from the recent global rout petered out
• European equity futures are indicative of a slightly lower open with the Euro Stoxx 50 -0.1% after the cash market closed down by 1.3% yesterday
• DXY is a touch softer but still firmly on a 103 handle, EUR/USD remains sub 1.09, JPY leads the majors as USD/JPY pulls back from 146
• 10yr UST futures extended on the rebound from yesterday’s trough as yields slightly eased back
• Looking ahead, highlights include UK Retail Sales and EZ CPI (Final), Trilateral Summit hosting Japanese, South Korean, and US leaders, ECB’s Lane

US TRADE

EQUITIES

• US stocks extended losses amid differing opinions on the reason behind the continued downturn including the further upside in long-term yields and zero days to expiration options, while technical selling was also cited. Furthermore, the latest data releases from the US also failed to inspire a turnaround despite a much stronger-than-expected Philly Fed manufacturing index and the decline in Initial Jobless Claimants.
• SPX -0.77% at 4,370, NDX -1.08% at 14,715, DJIA -0.84% at 34,474, RUT -1.15% at 1,850.
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NOTABLE HEADLINES

• Fed Chair Powell is to speak at the Jackson Hole Symposium on August 25th at 10:05EDT/15:05BST.
• Former President Trump said if he is re-elected to the White House in 2024, he would not reappoint Fed Chair Powell for another term, according to an interview on Fox Business News.

APAC TRADE

EQUITIES

• APAC stocks traded mostly lower after the early reprieve from the recent global rout petered out.
• ASX 200 was kept afloat but with price action rangebound amid a lack of pertinent catalysts and with gains in real estate and the commodity-related sectors counterbalanced by losses in tech, telecoms and consumer stocks.
• Nikkei 225 was choppy and briefly clawed back its opening losses as bargain buying kicked in and following the latest inflation data from Japan which printed in line with expectations.
• Hang Seng and Shanghai Comp were subdued with pressure seen in tech names and as property concerns lingered after state-owned developers warned of widespread losses, while Evergrande Real Estate Group filed for Chapter 15 bankruptcy in New York to protect US assets as it works on a restructuring of debts. Participants also await the results of today’s Hang Seng index review, while the losses in the mainland were stemmed after the PBoC’s liquidity efforts resulted in the largest weekly net injection since March.
• US equity futures were rangebound and languished near the prior day's lows as sentiment in Asia faltered.
• European equity futures are indicative of a lower open with the Euro Stoxx 50 -0.1% after the cash market closed down by 1.3% yesterday.

FX

• DXY marginally weakened alongside softer yields, while market participants look ahead to next week's Jackson Hole Symposium for the next major risk event ahead of a very thin docket on Friday.
• EUR/USD rebounded off the prior day’s lows although the 1.0900 status continued to elude the single currency.
• GBP/USD was indecisive with price action confined to a tight range around the 1.2750 level.
• USD/JPY continued its pullback from the 146.00 handle as yield differentials slightly narrowed.
• Antipodeans were initially firmer amid the initial relief seen across risk assets and after the PBoC set the strongest reference rate setting in comparison to expectations on record. However, activity currencies then gave back their gains as stocks failed to sustain the early optimism.
• PBoC sets USD/CNY mid-point at 7.2006 vs exp. 7.3065 (prev. 7.2076)

FIXED INCOME

• 10yr UST futures extended on the rebound from yesterday’s trough as yields slightly eased back and with little in the way of catalysts heading into the weekend.
• Bund futures edged higher and reclaimed the 131.00 level heading into EU inflation final readings for July.
• 10yr JGB futures followed suit to rebound across global peers and after the in-line Japanese CPI data.

COMMODITIES

• Crude futures saw early upside as stocks initially found some mild reprieve but then gave back some of the gains as the improvement in sentiment wore thin.
• Iran set September Iranian light crude price to Asia at Oman/Dubai + USD 3.45/bbl, according to a Reuters source.
• Australian union said protected industrial action ballots opened at Chevron's Wheatstone downstream and Gorgon facilities in Australia and the protected industrial action ballot will open on Monday at the Wheatstone platform.
• Spot gold kept afloat amid a weaker dollar but remained south of the USD 1,900/oz level.
• Copper futures traded rangebound as the risk appetite in Asia proved to be flimsy.

CRYPTO

• Bitcoin was subdued after slumping beneath the USD 27,000 level which some attributed to the circulation of a report that SpaceX wrote down the value of its Bitcoin holdings by USD 373 million and sold an unspecified amount.
• US SEC is poised to allow the first ETF based on Ether futures, according to a Bloomberg reporter.
• SpaceX wrote down the value of Bitcoin it owns by a total of USD 373mln last year and the year before and may have sold all of its holdings, according to WSJ.

NOTABLE ASIA-PAC HEADLINES

• China Evergrande (3333 HK) filed for Chapter 15 bankruptcy in New York to protect US assets as it works on a restructuring of debts, according to Bloomberg and Reuters.

DATA RECAP

• Japanese National CPI YY (Jul) 3.3% vs. Exp. 3.3% (Prev. 3.3%)
• Japanese National CPI Ex. Fresh Food YY (Jul) 3.1% vs. Exp. 3.1% (Prev. 3.3%)
• Japanese National CPI Ex. Fresh Food & Energy YY (Jul) 4.3% vs. Exp. 4.3% (Prev. 4.2%)

GEOPOLITICS

• Belarusian President Lukashenko said Belarus will use tactical nuclear weapons in the event of aggression and he believes Russia has achieved its goals in the special military operation.
• Russia's military said Ukraine attacked Russian warships near Crimea with an unmanned boat, while Russian warships destroyed the boat and repelled the attack, according to TASS and Reuters.
• Russian air defences shot down a Ukrainian drone in Moscow, while reports also noted that a building was damaged by the Ukrainian drone attack, according to Reuters.
• US approved sending F-16s to Ukraine from Denmark and Netherlands as soon as pilot training is completed.
• Russian President Putin held a telephone call with Iran’s President in which Iran's possible membership of BRICS was discussed, according to TASS citing the Kremlin.
• Russian Defence Ministry said Russian and Chinese navy ships are jointly patrolling the Pacific Ocean and held an exercise in the East China Sea.
• Turkey warned Russia and requested that it avoid further escalation after Russian forces fired warning shots to stop a cargo ship in the Black Sea on Sunday, according to Meduza.