Equities:
US equity futures under pressure as risk sentiment sours following a shift in HKMA’s portfolio strategy. The authority confirmed a reduction in duration across its US Treasury holdings, with diversification underway into non-USD assets. Spooz -0.7%, NQs -1.0%.

Europe:
DAX underperforms peers after CDU’s Merz fails in chancellor bid, injecting political uncertainty into German markets. Broader European indices also softer, though losses more contained outside the German complex.

FX:
USD offered across the board; JPY leads G10 FX with haven flows picking up. EUR upside faded following Merz developments, giving back earlier gains.

Rates:
Bunds initially bid on German political fallout, though gains have since moderated. Gilts lag on the session. Treasury curve steady post-HKMA headlines, long end sees marginal weakness.

Commodities:
Crude and gold catch a firm bid as geopolitical risk premium stays elevated. Energy complex underpinned into upcoming EIA STEO release.

Ahead:
Focus turns to US trade data, Canadian exports/imports, NZ HLFS unemployment print. Speakers include BoE’s Breeden. Supply from US Treasury eyed. Heavy earnings slate: AMD, Supermicro, Rivian, Tempus AI, Celsius, Datadog, Constellation Energy, UniCredit, Intesa Sanpaolo, Ferrari.