Public Markets 3 Days

Last updated: August 9, 2026, 11:32 PM ET

Public Markets Briefing

Macro & Policy

A surprise contraction in the U.S. labor market has reshaped the outlook for monetary policy. The economy lost 23,000 jobs in July, a much weaker-than-expected result that prompted traders to scale back rate-hike bets. U.S. stocks rose after the data, while Treasury yields fell sharply. The jobs report poses a new test for Fed Chair Kevin Warsh, who now faces growing investor expectations for a rate hike as soon as next month. Bond traders are bracing for the data to tip the scale, while the success of Warsh’s chairmanship may rest on the nation’s ongoing fiscal deficits, a challenge that sits outside traditional monetary policy. At the Fed, the inflation fight is complicated by the government's borrowing needs. Adding to the macro mix, BofA’s sentiment gauge hit its most extreme bullish level since 2021, prompting strategists to recommend reducing exposure to risky assets. Meanwhile, Fitch Ratings is skeptical that Chile’s tax cuts will boost growth enough to offset revenue drops, emphasizing fiscal discipline.

Geopolitics & Energy

Oil prices remain volatile amid a stalemate over the Strait of Hormuz. Oil futures settled higher Friday but posted a weekly loss, with WTI down 7.7% to $78.18 and Brent falling 5% to $83.55. Hopes for a breakthrough were dashed over the weekend as Tehran hardened its rhetoric, demanding new conditions from the U.S. before reopening the waterway. A top Iranian official laid out tough demands, including a U.S. withdrawal, while the UAE said Iran launched a missile attack on one of its ships. Iran demands that the U.S. meet its conditions, and the country is pushing for a return to the June MOU, using its leverage to get Washington to release frozen assets and lift sanctions. Iran, holding firm, sees the Strait as its best card. The situation is exacerbated by Houthi militants claiming an attack on a Saudi refinery and a near miss between a Jetstar and Qatar Airways plane at Sydney airport. The U.S. is burning through weapons in the Iran conflict, depleting stockpiles and eroding firepower, a dynamic that benefits Russia and China. The U.S. is burning through its arsenal. In a separate geopolitical development, Ukraine struck two Russian oil refineries, while Kyiv was also hit. Ukrainian grain exports are expected to slump after Russian strikes on Odesa disrupted Black Sea ports. Ukraine grain exports could fall by more than half.

Global Equity Markets

European stocks rose for a fourth straight week, driven by a stronger-than-expected earnings season. European stocks gained as M&A chatter lifted regional benchmarks to fresh records. The Stoxx Europe 600 is on track for a 22% increase in second-quarter profits, drawing investors back to the region. Investors return to European stocks, overcoming the Iran war gloom. In Japan, the Nikkei rose 1.2%, led by electronics and metals stocks, after weak U.S. jobs data diminished prospects for Fed rate increases. The Aussie-yen is poised to approach a three-decade high as the impact of Tokyo’s currency intervention fades and the RBA’s hawkish stance bolsters the Australian dollar. Aussie-yen is set to climb. South Korea’s stock-market turmoil is ebbing after a historic selloff flushed out leveraged positions, with Korea volatility spikes easing. Equity funds are up 10.6% year-to-date in 2026, a turbulent month for tech stocks. Stock funds have navigated volatility. Blockbuster earnings from the U.S.’s largest companies have bolstered stocks’ record run, easing worries about AI spending. The leveraged ETF boom is creating new ways to profit from sudden bursts of volatility. Leveraged ETF boom is amping up intraday momentum plays. In India, high-frequency trading firms are shunning the closing auction over SEBI’s short-selling hurdles. HFTs shun India’s closing auction. The Senate passed a stopgap bill to avert a government shutdown, avoiding a messy fight before the midterms.

Fixed Income, FX & Commodities

Bond markets are sending mixed signals. JGBs edged lower amid a potentially quicker pace of BOJ rate hikes, while Japan’s biggest insurers reported $96 billion in bond paper losses. Japan’s biggest insurers posted combined unrealized losses. Wall Street sees Treasury Secretary Scott Bessent sending signals to calm the bond market and keep yields from spiking. Behind Bessent moves, Wall Street sees bond-market angst. Wellington funds are pivoting from Treasuries to German bonds, doubting the Fed’s inflation-fighting credibility. South Africa’s bond market has already upgraded its debt, even as rating firms lag. South Africa is getting a market upgrade. In currencies, Asian currencies weakened against the dollar ahead of U.S. CPI data. The yen surged 1% after the jobs data, sparking intervention speculation. Central banks in emerging Asia are finding ways to support currencies without dipping into reserves. Currency defense is getting a makeover. India’s FX reserves are climbing toward a record on foreign inflows. India’s FX reserves have risen for five straight weeks. In commodities, gold held steady above $4,300/oz, supported by a softer labor market and a weaker dollar. Gold held above $4,300 as soft jobs data trimmed rate-hike bets. The copper market is tightening fast as a surge in shipments to the US and rising orders in China set the stage for a rally. Copper market is facing a crunch. Global food prices rose to a three-year high in July, driven by concerns over grain export corridors and adverse weather. Global food prices are at a three-year high. Australia’s wheat crop is rebounding at a crucial time for global supply. Australian wheat is seeing a recovery. China’s inflation cooled more than expected in July, suggesting tepid domestic demand. China inflation eased, and factory-gate inflation decelerated for the first time since the Iran war began. China’s inflation is easing as the oil shock starts to fade.

Sector & Company Spotlight

Major companies are reporting mixed results. Treasury Wine Estates shares soared after a A$558.4 million writedown to tackle US supply issues. Westpac shares dropped on signs of a housing slowdown in Australia. Allianz posted record profit, with Pimco seeing €32 billion in inflows. Daimler Truck plans a second $1.27 billion share buyback tranche. Take-Two logged higher sales but a wider loss due to discontinued development. Wendy’s withdrew its outlook and slashed its dividend as its turnaround struggles. Under Armour lowered its revenue outlook due to soft demand. Munich Re cut its revenue outlook after a volume drop in July contract renewals. In the energy sector, Barrick Gold’s chairman’s planned