US stocks mildly gained amid lower oil prices and yields, while Russian media reported a US-Iran ceasefire agreement - Newsquawk Daily Asia-Pac Market Open

• US stocks closed in the green on Tuesday, with the Nasdaq outperforming in a tech-led rally. Crude prices slumped on US-Iran optimism, with a further move lower seen in late trade after Russian press RIA reported that the US and Iran are close to a ceasefire agreement that includes freedom of navigation through the Strait of Hormuz. The report also weighed on the Dollar and supported Treasuries and stocks into the closing bell. However, at the time of writing, there has been no confirmation of the report from other outlets. Sectors were predominantly firmer, with Technology leading the gains, while Energy slumped alongside weaker crude prices. Consumer Discretionary was also pressured by weak Dick's (DKS) guidance, which weighed on peers including Nike (NKE), Lululemon (LULU) and On Holding (ONON).
• USD was marginally lower, although macro newsflow was fairly light and geopolitics dominated the tape, once again. There were several US data releases which failed to move the dial, with Consumer Confidence mixed, New Home Sales plunged, and Richmond Fed was soft, but the outlook was more encouraging, while in terms of Fed speak, Collins (2028 voter) noted she is concerned about price stability of the mandate and stated it would be appropriate to raise interest rates soon absent evidence of sustained disinflation.
• Looking ahead, highlights include Japanese Services PPI, Australian MI Leading Index, Monthly CPI & Construction Work Done, Singapore Industrial Production, Supply from Japan.

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LOOKING AHEAD

• Highlights include Japanese Services PPI, Australian MI Leading Index, Monthly CPI & Construction Work Done, Singapore Industrial Production, Supply from Japan.
• Click for the Newsquawk Week Ahead.

IRAN CONFLICT

• US President Trump posted that Iran is not paying large segments of its military while killing protestors at levels not seen before, calling it a humanitarian crisis that must be stopped.
• US President Trump posted that he had been informed all mines were gone from the international waters of the Strait of Hormuz, adding that Iran had been informed any vessel placing new mines would be destroyed and that a zero-tolerance policy on mine placement was in effect.
• Two US officials confirmed Trump's announcement and said the US Navy had cleared the Traffic Separation Scheme, the median lane of the Strait between Oman and Iran, according to Axios.
• US White House official told Al Jazeera there are no ongoing or scheduled talks or discussions with Iran, while the naval blockade is imposed with strength and effectiveness, the Strait of Hormuz is open, and mines have been removed.
• US Treasury Secretary Bessent said Iran's leadership is admitting what the world can now see: the pressure is working, citing comments from Iranian President Pezeshkian last week that "The war must come to an end at some point" and comments from Iran’s parliamentary speaker Ghalibaf that "No matter how much military power we have, if people are hungry and we don’t have financial circulation, economic growth and domestic production, we will not endure".
• US is reportedly mulling returning diplomats to Middle Eastern embassies as soon as this week, according to NYT, suggesting that the Trump administration does not anticipate a return to all-out hostilities.
• Ceasefire between the US and Iran has reportedly been agreed upon, which includes free navigation in the Strait of Hormuz and will be announced in the coming days, according to RIA citing Pakistani and Iranian sources.
• Iran's Deputy FM Gharibabadi said an understanding with Oman on the Strait of Hormuz does not mean opening of the Strait of Hormuz and before taking any action to reopen the Strait of Hormuz, the US must fully implement all its violated commitments. He also stated that in the understanding with Oman, the route into the strait is completely at our disposal, and part of the exit route is also in Iranian waters, while the distance between the two routes is not long.
• Iranian Foreign Minister Araghchi said Iran's commitment to peace and stability is matched by steadfast diplomacy with neighbours, while he noted that regional solutions were stressed in talks with Pakistani and Omani guests. Furthermore, he said a proposed framework for a new corridor, joint mine-clearing, and future management of Hormuz is the case in point.
• Senior Iranian official told Al Jazeera journalist that the talks with Pakistani Field Marshal Munir were constructive, with useful ideas exchanged, although no messages were passed in either direction.
• Iranian official said the visit of Pakistani Commander of the Army to Iran was highly fruitful, with the results of which will soon become apparent.
• Iran's positions and conditions on the Strait of Hormuz were announced transparently through Pakistan, while Pakistan Army Chief Munir was seeking to open the space for negotiations and to convey Iran's conditions and positions to the American side, according to TASNIM citing sources
• Pakistani Army Chief Munir conveyed an offer to Iran, from the US, to halt the siege and lift sanctions under the MOU, in exchange for opening the Strait of Hormuz and stopping proxy attacks, according to Al Arabiya/Al Hadath sources. Al Hadath also reported that Washington offered to halt the naval blockade and lift sanctions on Iran in exchange for opening the Strait of Hormuz and stopping proxy attacks.
• IRNA reported the Oman-Iran management mechanism of the Strait of Hormuz has reached its final stages.
• Joint statement between Oman and Iran on consultations between their Foreign Ministers noted that consultations focused on the importance that both countries attach to resuming safe navigation through the Strait of Hormuz.
• Oman’s Foreign Minister is hopeful they will soon announce a temporary corridor for the Strait of Hormuz and practical arrangements to restore safe navigation.
• Amwaj reporter Ali Shabani wrote that "Iran and Oman are inching towards proposed arrangement for a temporary secure shipping lane and joint mine clearing".
• Iranian missile and drone attacks have inflicted damage on US intelligence posts and surveillance hardware in the Middle East that is more extensive than any destruction America’s spy agencies have endured and will cost billions of dollars to repair, according to NBC citing four people with knowledge of the matter.

US TRADE

• US stocks closed in the green on Tuesday, with the Nasdaq outperforming in a tech-led rally. Crude prices slumped on US-Iran optimism, with a further move lower seen in late trade after Russian press RIA reported that the US and Iran are close to a ceasefire agreement that includes freedom of navigation through the Strait of Hormuz. The report also weighed on the Dollar and supported Treasuries and stocks into the closing bell. However, at the time of writing, there has been no confirmation of the report from other outlets. Sectors were predominantly firmer, with Technology leading the gains, while Energy slumped alongside weaker crude prices. Consumer Discretionary was also pressured by weak Dick's (DKS) guidance, which weighed on peers including Nike (NKE), Lululemon (LULU) and On Holding (ONON).
• SPX +0.30% at 7,67, NDX +0.64% at 29,209, DJI +0.30% at 53,577, RUT +0.48% at 3,009.
• Click here for a detailed summary.

TARIFFS/TRADE

• US President Trump posted that Canada has been ripping off the US for decades and is easily the most difficult and unreasonable country to deal with. Trump also posted that over the last 10 years, the United States lost, on average, USD 60bln a year with Canada, adding "No more!"
• US President Trump said the US is giving serious consideration to changing the name of Lake Ontario to Lake America, in that the US does not expect to do much business with Ontario any longer.
• Canada is applying 15-50% tariffs on around USD 20bln of US products. Canada’s government announced that counter tariffs will be on around 700 products at a rate of 15%, 25% or 50% effective September 8th,** while it will introduce a CAD 7.5bln package to support businesses and workers hit by new US tariffs.
• Canadian Trade Official LeBlanc said USTR Greer has acted in good faith and that there were problems around the French language in negotiations, although he still believes a deal that benefits both nations is possible.
• US and China reportedly agree to boost collaboration in AI trade, according to Xinhua.
• USTR Greer has been invited to Ireland for EU talks, according to Politico.
• Brazil and the US schedule new meeting for August 31st to discuss tariffs, according to Folha.

NOTABLE HEADLINES

• Fed Discount Rate Minutes stated that directors at 4 of the 12 regional Federal Reserve banks voted to increase the discount rate prior to the July 28-29 FOMC confab.
• Fed's Collins (2028 Voter) said inflation is still too high and is concerned about the price stability part of the Fed's mandate, and the labour market is consistent with full employment, while the economy is growing at a near-trend pace and current monetary policy is "mildly restrictive". Collins said the rise in longer-term interest rates should work against a re-acceleration in demand, and maintaining the current policy rate will need continued evidence that inflation is falling, as well as noted that it would be appropriate to raise interest rates soon absent evidence of sustained disinflation.
• US Treasury Secretary Bessent has reportedly formulated a plan that could escalate if the vigilantes continue to push up interest rates, according to the NY Post citing sources, looking to put the "fear of God" into bond vigilantes. Bessent is said to be particularly worried that institutional investors will continue to sell long-dated UST bonds, leading to the US 10yr yield hitting 5%, while the plan could include temporarily halting the issuance of certain long-dated debt, such as the 20yr.

DATA RECAP

• US Richmond Fed Manufacturing Index (Aug) 4 vs. Exp. 7 (Prev. 5)
• US Richmond Fed Manufacturing Shipments Index (Aug) 11 (Prev. 8)
• US Richmond Fed Services Revenues Index (Aug) -8 (Prev. -3)
• US CB Consumer Confidence (Aug) 89.4 vs. Exp. 90.2 (Prev. 90.2)
• US Building Permits Final (Jul MM) 4.3% vs. Exp. 5% (Prev. -2.6%)
• US New Home Sales (Jul MM) -10.5% (Prev. 1.6%)
• US New Home Sales (Jul) 607KM vs. Exp. 0.62KM (Prev. 628KM)
• US House Price Index (Jun MM) 0.0% vs. Exp. 0.2% (Prev. 0.3%)
• US S&P/Case-Shiller Home Price (Jun YY) 2.1% vs. Exp. 1.7% (Prev. 1.6%)
• US ADP Employment Change Weekly 11.75K (Prev. 9.5K)

FX

• USD was marginally lower, although macro newsflow was fairly light and geopolitics dominated the tape, once again. There were several US data releases which failed to move the dial, with Consumer Confidence mixed, New Home Sales plunged, and Richmond Fed was soft, but the outlook was more encouraging, while in terms of Fed speak, Collins (2028 voter) noted she is concerned about price stability of the mandate and stated it would be appropriate to raise interest rates soon absent evidence of sustained disinflation.
• EUR eked out mild gains but with upside contained and price action kept within a thin range, while the single currency failed to benefit from a source report that ECB policymakers are ready to raise rates in September to stem side effects of the Iran war.
• GBP shrugged off initial weakness and ultimately gained in choppy trade.
• JPY lacked firm direction with USD/JPY rangebound at the 159.00 handle.
• Hungarian Interest Rate Decision 5.50% vs. Exp. 5.5% (Prev. 5.75%)

FIXED INCOME

• T-notes settled higher and Treasury yields slid as oil prices dropped.

COMMODITIES

• Oil prices were lower as geopolitical developments appeared constructive following Bessent's underwhelming 'Operation Outcast' and accompanying sanctions, while there was a report late in the day by Russian press that a ceasefire between the US and Iran has been agreed upon, although this was not mentioned by the major newswires.
• Tanker Trackers highlighted that at least fifteen sets of ship-to-ship transfers were taking place in the Gulf of Oman; "We count 25 million barrels of crude oil; plus some refined products. The oil originates from almost every country in the region, minus Iran."
• Japan’s government is set to launch state support for construction of oil pipelines which bypass the Strait of Hormuz and PM Takaichi will announce this at the Green Transformation meeting on the 26th August, while it was also reported that Japan plans to continue keeping the gasoline price at around JPY 170/litre.
• Russia could extend the diesel export ban through September and is also considering a further extension of the ban until year-end, according to sources.

GEOPOLITICAL

MIDDLE EAST

• An agreement was reached to resolve any dispute diplomatically between Syria and Israel, with the US acting as a guarantor for Turkey, according to Al Hadath citing sources.

RUSSIA-UKRAINE

• Russia's Defence Ministry said forces struck a cargo vessel and a tanker in the Black Sea, according to Tass.
• US CIA Director Ratcliffe travelled to Russia for meetings in Moscow today. It was separately reported that President Trump’s administration asked Ukraine not to strike various parts of Russia last week, as it sent a senior official into the region, according to FT citing sources.

OTHER

• US President Trump reiterated that he instructed War Secretary Hegseth to substantially reduce joint military exercises with South Korea, based on his very good relationship with North Korea's Kim Jong Un. Trump added that he recently asked the President of South Korea if they would like to join us in the Denuclearization of the Islamic Republic of Iran, and they said, "No thanks!", while he commented that North Korea have been unthreatening and respectful while he has been president.

ASIA-PAC

NOTABLE HEADLINES

• Alibaba (9988 HK) founder Jack Ma bought more than HKD 600mln worth of the company’s Hong Kong-listed shares on consecutive days in what is seen as a show of confidence in the firm's long-term prospects for artificial intelligence, according to people familiar with the matter cited by SCMP.
• Japan is set to begin work on a next-generation payment infrastructure, with an initial goal of enabling the instantaneous settlement of transactions in stocks and Japanese government bonds at any time of day using blockchain technology, according to Nikkei.

EU/UK

NOTABLE HEADLINES

• UK PM Burnham is expected to meet with US President Trump, along with other officials, at the September UN General Assembly, while the UK is also expected to look into a meeting with Trump at the White House, according to FT.
• ECB policymakers are reportedly ready to raise rates in September to stem side effects of the Iran war, while they have little appetite to signal further tightening, according to sources.

DATA RECAP

• German Ifo Business Climate (Aug) 88.8 vs. Exp. 87.2 (Prev. 86.6)
• German Ifo Expectations (Aug) 89.1 vs. Exp. 87.5 (Prev. 86.7)
• German Ifo Current Conditions (Aug) 88.5 vs. Exp. 87 (Prev. 86.5)
• German GDP Growth Rate Final (Q2 QQ) 0.3% vs. Exp. 0.2% (Prev. 0.4%)
• German GDP Growth Rate Final (Q2 YY) 1.0% vs. Exp. 0.9% (Prev. 0.7%)