European markets are showing resilience after a weak start, rebounding from early losses driven by a negative handover from the Asia-Pacific region. However, US futures remain under pressure, signaling caution ahead of key economic data and corporate earnings.

Currency and Bond Markets

The US Dollar Index (DXY) is slightly lower, but EUR/USD remains anchored in the 1.04 range, showing little momentum. Meanwhile, Antipodean currencies (AUD, NZD) are underperforming, reflecting broader risk-off sentiment.

In bond markets, US Treasuries are moving higher, while German Bunds are trending lower as investors await updates on coalition negotiations and potential government spending plans. This divergence highlights the complex macroeconomic landscape impacting fixed-income markets.

Commodities: Choppy Crude, Subdued Metals

Oil prices are experiencing volatility, fluctuating in choppy trade amid shifting supply-demand dynamics. Despite a softer US Dollar, metals remain under pressure, suggesting that broader economic concerns are weighing on the commodity space.

What’s Ahead?

Investors will be closely watching a series of important events today:

• Economic Data: US Consumer Confidence, Richmond Fed Manufacturing Index
• Central Bank Updates: NBH Policy Announcement, Fed Discount Rate Minutes
• Speakers: Comments from RBA’s Jones, Fed’s Barr & Barkin, ECB’s Schnabel, and BoE’s Pill
• Market Supply: US bond auctions
• Earnings Reports: Home Depot, Dr Pepper, AMC, and Lucid

With a packed agenda, markets are bracing for potential volatility as traders digest economic signals, central bank insights, and corporate earnings reports. Stay tuned for more updates as the trading day unfolds.