US stocks gained with upside led by tech strength, while fresh record highs were seen in the S&P 500 and NDX - Newsquawk Asia-Pac Market Open

• US stocks were bid on Wednesday with upside led by the Nasdaq as tech stocks, namely NVDA, outperformed while the Dow lagged. There was a continued lack of progress on ending the government shutdown, although there was some optimism on the political situation in France and hopes regarding a Gaza deal, which appears to be very close to an agreement. Meanwhile, in the US, the Fed minutes were hawkish, and the 10-year T-note auction was weak.
• USD remained firmer against its peers despite the continued absence of US data, although the FOMC Minutes offered further details on the September meeting and confirmed Governor Miran as the sole dissenter amongst voters and non-voters in which he sought a larger 50bps cut, while a few participants saw merit in keeping the FFR unchanged at that meeting, or could have supported such a decision.
• Looking ahead, highlights include UK RICS House Price Balance, Australian MI Inflation Expectations, Supply from Japan, Holiday Closure in South Korea.

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LOOKING AHEAD

• Highlights include UK RICS House Price Balance, Australian MI Inflation Expectations, Supply from Japan, Holiday Closure in South Korea.
• Click for the Newsquawk Week Ahead.

US TRADE

• US stocks were bid on Wednesday with upside led by the Nasdaq as tech stocks, namely NVDA, outperformed while the Dow lagged. There was a continued lack of progress on ending the government shutdown, although there was some optimism on the political situation in France and hopes regarding a Gaza deal, which appears to be very close to an agreement. Meanwhile, in the US, the Fed minutes were hawkish, and the 10-year T-note auction was weak.
• SPX +0.58% at 6,754, NDX +1.19% at 25,137, DJI +0.00% at 46,602, RUT +1.04% at 2,484.
• Click here for a detailed summary.

FOMC MINUTES

• FOMC Minutes stated that most judged it would likely be appropriate to ease policy further over the rest of the year and almost all participants supported a 25bps cut to the Fed funds rate at the September meeting. Participants generally noted their judgments about appropriate policy action at the September meeting reflected a shift in the balance of risks, while some noted financial conditions suggested policy may not be particularly restrictive, and those participants judged that a cautious approach to future policy was warranted. A few participants also saw merit in keeping the Fed funds rate unchanged at the September meeting, or that they could have supported such a decision, while one participant preferred a 50bps rate cut at last month's meeting (This was Miran, although there were no non-voters that supported a 50bps rate cut). Furthermore, most participants judged that the downside risks to employment had increased and upside risks to inflation had either diminished or not increased, while a majority of participants emphasised upside risk to their outlooks for inflation.

TARIFFS/TRADE

• US Commerce Department added 29 entries to its entity list under China, Turkey and UAE.
• EU sees new US trade demands hollowing out deal struck by US President Trump, while the Trump admin reportedly sent the EU a fresh proposal for implementing “reciprocal, fair and balanced” trade earlier in the month, according to Bloomberg, citing sources.
• Canadian PM Carney said he had productive meetings with US Senate representatives yesterday. Carney also said that he and US President Trump had a meeting of minds on the future of the steel and auto sectors.
• Mexican President Sheinbaum said talks with the US are going well and will continue next week.

NOTABLE HEADLINES

• US House Speaker Johnson said "he opposes any attempt to end the Senate filibuster to bypass Democrats and reopen government", according to Bloomberg's Wasson.
• Democratic bill to end US government shutdown failed to win enough votes to pass in the Senate, while the Republican bill to end the US government shutdown also failed to win enough votes to pass in the Senate.
• US House Minority Leader Jeffries said he supports an effort to pass a standalone bill to pay military troops as the shutdown continues.
• US IRS is to furlough 34k employees as part of the government shutdown.

FX

• USD remained firmer against its peers despite the continued absence of US data, although the FOMC Minutes offered further details on the September meeting and confirmed Governor Miran as the sole dissenter amongst voters and non-voters in which he sought a larger 50bps cut, while a few participants saw merit in keeping the FFR unchanged at that meeting, or could have supported such a decision.
• EUR softened but is off intraday lows after finding a floor around the 1.1600 level and following comments from French caretaker PM Lecornu, who noted there is a majority in parliament that are against the dissolution of parliament, and that they could have a new PM in 48 hours.
• GBP breached the 1.3400 level to the downside, although recouped some of the losses, while rhetoric from BoE Chief Economist Pill had little impact as he noted that monetary policy should be resolutely focused on price stability and policymakers should make a clear and credible commitment to achieve the price stability objective.
• JPY continued to weaken but with some of the upside in USD/JPY pared after hitting resistance just shy of the 153.00 handle.
• Polish NBP Base Rate (Oct) 4.5% vs. Exp. 4.75% (Prev. 4.75%). Polish Central Bank said it may intervene in the FX market and that further decisions will depend on data, while it added that fiscal policy and administered prices are sources of uncertainty, as well as noted that rates were cut due to a better CPI outlook.

FIXED INCOME

• T-notes faded the early EGB-led upside ahead of what turned out to be an ultimately weak 10-year auction and with hawkish-leaning FOMC minutes.

COMMODITIES

• Oil prices extended on weekly gains despite the larger-than-expected build in EIA crude inventories as oil consumption proved resilient.
• US EIA Weekly Crude Stocks w/e 3.715M vs. Exp. 1.885M (Prev. 1.792M).
• Russia's Deputy Prime Minister Novak announced increasing fuel output at Russian refineries, in which they plan to increase oil output gradually, while he added that Russia is also committed to the OPEC+ agreement and was close to the OPEC+ quota in September.
• ICSG said slower production growth will push the copper market to a 150k tons deficit in 2026 vs prev. forecast of a surplus of 209k tons, while it noted that world refined copper production is expected to rise by around 3.4% in 2025 and 0.9% in 2027.

GEOPOLITICAL

MIDDLE EAST

• Israeli government has already begun drafting the official proposal on the hostage deal that will be brought to a vote before ministers when a deal is agreed upon, according to i24news. It was separately reported that a deal has been "closed and secured" on Gaza, according to an Israeli journalist citing Ynet News sources
• Senior Israeli official said there is progress and they feel cautious optimism regarding Gaza negotiations, while a non-Israeli source familiar with the talks said the Qatari mediators believe an agreement can be reached by Friday, according to Axios.
• Gaza deal could be signed in next 24-36 hours if things continue as they are, and after that point, phases of agreement would be implemented, including ceasefire and hostages being released, according to Sky News citing sources.
• US President Trump said he was just dealing with people on the Gaza deal, and he may go to the Middle East by the end of the week, maybe on Sunday, while he added that the negotiation with Hamas seems to be going well.
• Israeli security source told Sky News Arabia that “Israel insists on not accepting any ideas outside the Trump plan”.
• Israeli and foreign sources told Amichai Stein that they are optimistic about the chances of reaching a deal and are entering the critical hours.
• Hamas leader told AFP that optimism dominates Gaza talks, according to Sky News Arabia. It was also reported that Hamas said a list of hostages' names was exchanged on Wednesday according to agreed numbers.
• Egypt's President is optimistic after promising messages from Gaza ceasefire talks, according to Al Jazeera.
• Arab diplomat involved in the negotiations for the deal told Kan News that "the impression is that the talks in Sharm are proceeding positively, at least with regard to the release of Palestinian abductees and prisoners".
• Turkish Foreign Minister said if a positive outcome is reached in the Gaza ceasefire negotiations on Wednesday, a ceasefire will be declared.
• US Secretary of State Rubio will not participate in the foreign ministers' meeting organised tomorrow by France to discuss the post-war plan for Gaza, according to Axios citing sources.
• Iran's Foreign Minister Araghchi denied reports that he's been in direct contact with US Envoy Witkoff, including in a secret meeting in Doha or Muscat.

RUSSIA-UKRAINE

• Russian Defence Ministry said Russian forces have captured Novohryhorivka in Ukraine's Zaporizhzhia region, according to Al Arabia.
• Russian Duma warned “The response to the delivery of Tomahawk missiles to Ukraine will be very harsh”, according to Al Arabiya.
• Russian Foreign Minister Lavrov said maintaining Russia's obligations under the plutonium agreement with the US is no longer acceptable, according to TASS.

ASIA-PAC

NOTABLE HEADLINES

• Japanese LDP Leader Takaichi's economic measures are reportedly delayed, and the PM nomination is likely to be postponed until late October, according to Nikkei.
• Japanese Economy Minister Akazawa is expected to depart from his position, according to local reports via Mainichi newspaper.

EU/UK

NOTABLE HEADLINES

• BoE FPC Minutes stated the FPC decided to maintain the UK countercyclical capital buffer (CCyB) rate at 2% and risks associated with geopolitical tensions, global fragmentation of trade and financial markets, and pressures on sovereign debt markets remain elevated. Furthermore, it stated that despite persistent material uncertainty around the global macroeconomic outlook, risky asset valuations have increased and credit spreads have compressed.
• BoE Chief Economist Pill said monetary policy should be resolutely focused on price stability and policymakers should make a clear and credible commitment to achieve the price stability objective.
• ECB's Nagel said current monetary policy is appropriate and that euro zone inflation is close to the 2% target.
• ECB's Escriva said he cannot pre-empt the direction of a future policy move and that inflation expectations are very much anchored, while he added the ECB needs to be cautious and the outlook remains uncertain going forward.
• French Caretaker PM Lecornu said as of Wednesday evening, he considers the mission finished and there is a majority in parliament that is against the dissolution of parliament, while he added they could have a new PM in 48 hours. Furthermore, he told French President Macron the prospect of dissolution is becoming more remote, and the situation with France's pension system remains one of the biggest blocking points. It was later reported that French President Macron will name a new PM in the next 48 hours.
• German Economy Minister revised up the German 2025 growth forecast to 0.2% (prev. 0.0%), while 2026 growth is seen at 1.3% and 2027 growth is seen at 1.4%, according to the Economy Ministry.

DATA RECAP

• German Industrial Output MM (Aug) -4.3% vs. Exp. -1.0% (Prev. 1.3%)