General Market News

US stock futures traded near flat on Thursday morning as markets awaited the Producer Price Index report, following Wednesday's data showing cooling consumer inflation in July. The softer inflation reading reduced expectations for a September Federal Reserve rate hike, though most analysts still anticipate at least one increase before year-end.

• Initial jobless claims data is due, providing follow-up context to last week's unexpectedly weak employment report
• Oil prices declined as President Trump shifted strategy from military action to economic pressure regarding the Strait of Hormuz
• Cisco and Cerebras reported earnings that beat expectations with strong AI infrastructure demand, but both stocks fell in after-hours trading; Applied Materials reports after the close following a 190% annual gain

Diesel prices have surpassed jet fuel prices in Europe for the first time in over a year as the continent faces a worsening diesel shortage driven by Russian export bans and refinery disruptions. Europe has successfully increased jet fuel imports from alternative sources like the U.S. and Nigeria, while diesel imports have fallen sharply. The supply imbalance raises concerns about persistent diesel scarcity heading into winter for industry and agriculture.

• European jet fuel imports rose to 750,000 barrels per day in June (highest since October 2025) while diesel imports dropped to 1.56 million bpd in July from 1.97 million bpd in January
• Diesel prices are now 14% below April peaks while jet fuel prices remain 25% below March records, with jet fuel trading at a $24/ton discount to gasoil futures as of August 10
• Goldman Sachs warns of 'higher risk of persistent scarcity pricing in diesel than in crude heading into winter' due to Russian export ban and Iranian war-related supply disruptions

Pharmaceutical companies are withholding applications for health insurance coverage in Switzerland due to concerns that lower Swiss prices could negatively impact their U.S. business under Trump administration drug-pricing policies. About one-third of new innovative medicines were not submitted for Swiss mandatory health insurance coverage between January 2025 and June 2026, potentially limiting patient access to treatments.

• Only 15 of 22 new innovative drugs were submitted for Swiss reimbursement during the 18-month period, compared to an average of 24 submissions in similar periods between 2019-2025
• Switzerland is used as a benchmark country under the U.S. 'most-favoured-nation' drug-pricing policy, which compares U.S. prices with other markets to lower domestic medicine costs
• Seven drugs were not submitted for reimbursement and three were not submitted for Swiss market approval at all, with drugmakers avoiding timely Swiss launches to protect higher U.S. pricing

Over 140 firms including Visa, Mastercard, Stripe, BlackRock, and Coinbase announced Open USD (OUSD), a new dollar stablecoin that would pass reserve income to distribution partners rather than keeping it as issuer profit. The announcement triggered a 17.5% drop in Circle shares to $62.63, as the model threatens the economics of incumbent stablecoin issuers like Circle, whose reserve income represented 94% of Q1 2026 revenue.

• OUSD plans no minting fees or volume caps and would distribute reserve income to partners net of management fees, making what Circle pays Coinbase ($907.9M in 2024, roughly 54% of Circle's revenue) the sector default instead of a negotiated cost.
• Total stablecoin supply was $292.3B as of August 2, 2026, down 4.6% from May peak, with USDC contracting 7.6% over 90 days to $71.5B despite on-chain transaction volume growing 263% year-over-year in Q1.
• OUSD is not yet live (targeted H2 2026 on Ethereum, Solana, and Tempo), some named partners have disputed participation, and regulatory constraints under GENIUS Act and proposed CLARITY bill bar direct yield to holders, shifting competition to distribution economics.

Chinese AI startup DeepSeek announced it will raise API pricing for its V4-Pro and V4-Flash models, with increases ranging from 50% to 1,100% depending on the model, token type, and time of use. The company will also introduce peak and off-peak pricing structures, with the new rates taking effect on August 17.

• Price increases range from 50% to 1,100% above current rates, varying by model type, token type, and usage time
• DeepSeek is introducing a new peak and off-peak pricing structure to differentiate costs based on demand periods
• The pricing changes will take effect on August 17, impacting developers and businesses using DeepSeek's V4 model APIs

Saudi Aramco is handling September crude oil allocations to Asian customers on an ad hoc basis rather than through its standard monthly process, due to disruptions from hostilities in the Strait of Hormuz and Red Sea. The Houthis declared a maritime embargo against Saudi Arabia on July 20, attacking Saudi-linked tankers and oil facilities, making shipowners reluctant to enter key Saudi export routes. This has created uncertainty for buyers seeking to secure vessels and lift their contractual volumes from the world's largest oil exporter.

• Saudi Arabia cut its September price for Arab Light crude to Asia to a six-year low to attract demand amid the supply disruptions
• Saudi crude shipments to Asia fell below 3 million barrels per day in July 2026, down from 4.9 million bpd shipped in the prior year
• Saudi Arabia offered alternative loading from Egypt's Sidi Kerir port, but Asian buyers are reluctant due to longer voyage times and higher freight costs

The U.K. economy grew 0.4% in Q2 2026, maintaining its position as the G7's fastest-growing economy with annualized growth of 2% in the first half. However, the Iran war and closure of the Strait of Hormuz threaten this momentum through higher energy prices and inflation. Treasury officials have reportedly warned that growth could slow to just 0.3% next year if the Middle East conflict continues.

• Business investment increased 1.7% in Q2, defying economist forecasts of a 0.5% decline, with growth driven by consumer spending during hot weather and the FIFA World Cup
• The U.K. is highly exposed to energy price shocks due to oil and gas imports, and the IMF warned the Iran conflict would hit U.K. growth harder than any other rich country
• Economists caution the strong first-half performance is 'likely too good to be true' with growth concentrated in services while construction and industrial production remain down year-over-year

The European Union's May ban on public funding for utility-scale solar inverters from 'high-risk' countries like China is expected to benefit European suppliers such as SMA Solar. The ban affects equipment that could potentially disrupt Europe's power grid, targeting a market where Chinese manufacturers currently supply about 70% of inverters.

• SMA Solar CEO estimates the company could gain around 10% market share, as roughly one-fifth of larger solar projects use EU funding and will now exclude suppliers from China, North Korea, Russia, and Iran
• The ban will affect at least 14 gigawatts of new solar capacity based on current deployment levels, with the situation expected to stabilize by early 2027
• SMA Solar has reduced dependence on China to just 2-4% of components for large-scale inverters and reports early discussions with customers who previously bought from Chinese suppliers

As the U.S.-Iran war continues, global oil stocks are under severe strain, with the world having lost 2.6 billion barrels since the conflict began according to Saudi Aramco. IEA government-held reserves have fallen below 1 billion barrels, enough to cover the estimated 5 million bpd supply gap for only 180 days. Critical shortages of diesel and jet fuel pose particular concerns, while uncertainty about accessible reserves and commercial stock availability clouds the outlook.

• U.S. Strategic Petroleum Reserve has dropped to lowest levels since 1983, with approximately 100 million barrels now inaccessible due to deteriorating infrastructure, leaving only 200 million barrels available (covering just 40 days of the current supply gap)
• Global diesel and jet fuel stocks are at the bottom of their five-year range after Middle Eastern and Russian refineries were damaged, creating acute shortages of these critical middle distillates
• China holds an estimated 1.7 billion barrels in undisclosed reserves, enough to cover its pre-war Strait of Hormuz imports (5.5 million bpd) for nearly a year, making it one of the most comfortable positions among major economies

Candle Lake has offered to acquire Swedish online casino provider Evolution for approximately $13.8 billion (131.7 billion Swedish crowns), or 695 crowns per share. The Cayman Islands-registered firm, which already owns just over 30% of Evolution, made the bid due to an offer obligation but stated it does not intend to buy all outstanding shares.

• The offer price of 695 crowns per share represents a 5.7% discount to Evolution's closing price of 737.2 crowns on Wednesday
• Candle Lake disclosed a holding of just above 30% in Evolution last month, triggering the mandatory offer obligation under Swedish takeover rules
• Evolution declined to comment on the offer when contacted by Reuters

Online fast-fashion retailer Shein lost its London copyright lawsuit against rival Temu on August 13. Shein had accused Temu of using its product photos to advertise copied clothing items, claiming copyright infringement 'on an industrial scale,' but Judge Kelyn Bacon ruled against Shein's claims.

• Shein alleged Temu used its photos to 'piggy-back' on its more established market position by advertising copies of Shein's own-brand clothing
• Temu, owned by PDD Holdings, denied the allegations and argued Shein was using litigation to stifle competition
• Judge ruled that Shein's copyright infringement claims failed, delivering a victory for Temu in the competitive fast-fashion market

A Ukrainian drone strike forced the complete shutdown of Russia's Orsk oil refinery, with repairs expected to take up to six months due to damaged imported equipment and sanctions. The closure is causing regional fuel shortages and disruption for motorists in the Orenburg region. Ukraine has intensified attacks on Russian refineries in 2024 to increase the economic cost of the war.

• The Orsk refinery has an annual capacity of 6 million metric tons and produces gasoline, diesel, aviation fuel, and other petroleum products
• Only 80% of the region's 287 filling stations remain operational, with priority given to emergency and specialized vehicles
• The refinery is located 1,470 km southeast of Moscow near the Kazakhstan border, and repairs are delayed by sanctions preventing access to imported equipment

France's fifth heatwave this summer is forcing significant nuclear power curtailments, with approximately 15% of the country's nuclear fleet capacity (9.4 gigawatts across nine reactors) expected to be limited on Friday. Environmental regulations restricting heat discharge into rivers during high temperatures are driving the reductions, pushing French power prices to their highest levels since June and forcing neighboring countries to activate coal and gas plants.

• Six French nuclear reactors expected fully offline Friday, with total curtailments reaching 9.4 gigawatts at peak - French day-ahead power prices rose 4.4% to €154.50 per megawatt hour, the highest since June 23
• France depends on nuclear for 70% of annual electricity production; environmental rules limit heat discharge into rivers, forcing output cuts when water temperatures rise during heatwaves with temps reaching 35-40°C
• Nuclear shortfall impacts neighboring countries including Britain and Germany, which must activate coal and gas plants to compensate for reduced French nuclear power exports

U.S. Treasury yields declined Thursday morning as investors awaited the July Producer Price Index (PPI) report, following an in-line Consumer Price Index reading that reduced expectations for a September Federal Reserve rate hike. The 10-year Treasury yield fell to 4.674%, while the 2-year yield dropped to 4.176%.

• July PPI expected to rise 0.2% month-over-month, with release scheduled for 8:30 a.m. ET Thursday
• July CPI came in at 0.1% monthly increase, matching expectations and marking the second consecutive encouraging inflation report
• Goldman Sachs analysts suggest Fed voters would likely wait for August inflation data before deciding on a September rate hike

Thyssenkrupp is renegotiating the funding terms for its €3 billion green steel plant in Duisburg, Germany, after the original plan to use hydrogen became unrealistic. The European Commission has approved amendments to the funding framework, allowing the project to proceed with two-thirds of financing from the German government and state despite the changed fuel source.

• €3 billion ($3.5 billion) project receives two-thirds funding from German government and state, originally contingent on hydrogen use
• European Commission approved planned amendments to funding rules, confirming compliance with EU state aid law
• New funding framework allows money to flow despite hydrogen not being used initially, addressing changed economic environment

Online fast-fashion retailer Shein is planning to debut on the Hong Kong stock market on August 28, with its IPO launch expected as soon as next week. The Singapore-based company, founded in China in 2012, is moving forward with the listing after previously pursuing debuts in New York and London, amid a significantly reduced valuation and recent financial challenges.

• Shein's expected valuation of $30-40 billion represents a steep decline from nearly $100 billion in 2022, reflecting slowing growth, rising costs, and changing market conditions
• The company recently swung to a $99 million quarterly loss after the U.S. removed an import duty exemption on small packages
• The Hong Kong listing marks the end of a multi-city pursuit that previously included attempts to list in New York and London before settling on the Asian financial hub

India's Black Box secured a $131 million order from an undisclosed U.S. Tier-1 hyperscaler to provide digital infrastructure services for a major data center project in the United States. The three-year project represents a new customer addition to Black Box's hyperscaler portfolio and could lead to further expansion of the relationship.

• The project will span approximately three years at a key U.S. location, with expectations for further expansion beyond the initial scope
• This order adds a new hyperscaler client to Black Box's existing portfolio of global hyperscaler customers
• CEO Sanjeev Verma indicated that successful execution could serve as a foundation for expanding the customer relationship

Swedish gaming company Embracer Group reported first-quarter adjusted operating profit that more than doubled analyst expectations, driven by improved performance in its PC and console games division. The strong results signal a turnaround in the company's core gaming business.

• Adjusted operating profit exceeded analyst forecasts by more than 100%
• The PC and console games segment was the primary driver of the earnings beat
• Results indicate strengthening fundamentals in Embracer's traditional gaming business after previous restructuring efforts

South Korea's Kospi benchmark has surged more than 20% from its July low, entering bull-market territory after a rout driven by leveraged positions and forced selling pushed it into bear-market territory last month. The rapid reversal, fueled by strong semiconductor stocks and renewed AI optimism, raises questions about the rally's sustainability given the index's heavy concentration in a handful of chip companies.

• The rebound was driven by strong U.S. tech earnings, continued AI infrastructure spending commitments, and the unwinding of leveraged positions as brokerages normalized margin requirements
• The Kospi's heavy dependence on semiconductor giants creates significant exposure to AI sentiment shifts, with analysts warning that any negative signals on capex spending or Fed tightening could trigger pullbacks
• Analysts are divided on sustainability: some cite improving fundamentals and corporate governance reforms reducing the 'Korea discount,' while others caution that elevated retail participation and steep concentration resemble late-cycle behavior

Iran has disputed U.S. President Trump's claims of having 'total control' over the Strait of Hormuz, stating the waterway remains blocked pending acceptance of Iranian conditions. Ship traffic through the strait has dropped to near 3-month lows at approximately 13 vessels daily, down 90% from pre-conflict levels of 130 ships per day. The standoff follows U.S. and Israeli attacks on Iran on February 28, with both sides hardening their negotiating positions.

• Ship traffic through Hormuz has fallen to around 13 vessels on Tuesday, nearly the lowest since May 12 and 90% below the pre-conflict daily average of 130 ships
• Iran's conditions for reopening include ending the U.S. naval blockade, sanctions relief, American troop withdrawals, and war reparations
• A top IRGC advisor stated that Iran aims to 'attain deterrence' by prolonging the conflict to impose costs on potential attackers, claiming the U.S. military is 'weaker than what we perceived'