As we navigate through the trading day, European equities are experiencing a robust performance, remaining entirely in the green and nearing session highs. Meanwhile, US futures are showing modest gains with the Nasdaq (NQ) slightly outperforming its peers.

A significant political development has emerged as US President Joe Biden has announced he is dropping out of the Presidential race. In a surprising move, he has endorsed Vice President Kamala Harris as his preferred successor. This political shift has so far had a muted effect on the markets, particularly US Treasuries (USTs), which remain flat and unreactive to the news. Conversely, German Bunds have dipped below the 132.00 mark.

In the currency market, the US Dollar is trading flat. The Japanese Yen (JPY) has caught a bid in early European trade, making it the outperformer of the day. On the other hand, the Antipodean currencies, such as the Australian Dollar (AUD) and New Zealand Dollar (NZD), are lagging behind. This underperformance follows disappointing stimulus measures from the People’s Bank of China (PBoC), which failed to meet market expectations.

Commodities are seeing mixed movements. Crude oil prices are holding steady around the unchanged mark. Gold (XAU) remains flat, oscillating on either side of the USD 2400/oz level, while base metals are presenting a mixed picture with no clear trend.

Looking ahead, the economic calendar is light, with no major releases expected for the rest of the day. This lack of pertinent data might keep market movements subdued and primarily driven by broader geopolitical and macroeconomic narratives. Stay tuned for further updates as we continue to monitor these developments.