US equity futures were firmly lower on Tuesday after a long weekend, as higher energy prices dented the outlook on margins and lifted risks of higher interest rates. Contracts for the S&P 500 and Nasdaq 100 were 0.5% down, and those for the Dow fell nearly 1%. New strikes between the US and Iran prolonged expectations on suspended fuel exports from the Persian Gulf, while attacks from Houthi forces damaged Saudi energy infrastructure and dented their capacity. Borrowing costs for US companies were also lifted by hawkish signs from the Bank of Japan and likely selling of US Treasury securities by Japan to support the yen. Credit-sensitive hyperscalers were firmly lower, with Microsoft and Alphabet down 1%, while Amazon fell 1% ahead of its sterling bond offer. AI companies have increasingly borrowed in foreign currencies as dollar bond markets already face soaring AI-debt supply. In turn, Oracle gained 4.5% ahead of its earnings this week.

The yield on the US 10-year Treasury note topped 4.8% on Tuesday, the highest since October 2023, as traders returned from a long weekend to a week packed with key economic data that could help shape expectations for the Fed’s next moves. The CPI and PPI reports due this week are expected to provide further clues on inflationary pressures, particularly those linked to rising energy costs. Headline inflation is expected to remain steady at 3.4%, while the core rate is forecast to slow slightly to 2.4%. Meanwhile, both headline and core producer prices are expected to accelerate, reaching 5.3% and 4.6%, respectively. Oil prices have also continued to rise amid ongoing strikes in the Middle East, exacerbating concerns over supply disruptions. Markets are currently pricing in roughly a 58% chance of a 25bps rate hike by the Fed next week. Meanwhile, Tuesday’s three-year Treasury auction kicks off a busy stretch of government debt issuance.

The US NFIB Small Business Optimism Index fell to 98.7 in August 2026 from 99.8 in July and below forecasts of 99.3. Actual sales worsened, with a net negative 9% of owners reporting higher nominal sales in the past three months, the lowest since November 2025. Reports of inflation as the single most important problem increased to 16%, now tying with taxes as the second top small business issue. Reports of “labor quality or availability” and “labor costs” as owners’ single most important problem eased, with “labor costs” dropping to its lowest level since March 2021. In addition, expectations for better business conditions deteriorated. “Uncertainty remains elevated among small business owners as they face a mixed set of challenges with weakened sales, supply chain disruptions, and inflation pressures. While expectations for the overall economy dimmed, Main Street owners remain largely positive in the health of their own businesses”, said NFIB Chief Economist Bill Dunkelberg

South Africa's economy shrank by 0.2% qoq in Q2 2026, reversing the revised 0.4% growth recorded in Q1 and worse than the expected 0.1% decline. This marked the first economic downturn since Q3 2024, snapping its longest quarterly growth run in almost a decade, amid the fallout from the Middle East conflict. Three of the ten industries contracted, led by trade, catering and accommodation (-1.9%), while energy-intensive manufacturing and mining fell 1.8% and 3.0%, respectively. Agriculture, however, provided some cushion, rising 0.3% on stronger activity in horticulture and field crops. Other sectors also grew, including utilities (1%) and government services (1%) and transport, storage and communication (0.9%). On the demand side, household and government consumption rose 0.4% each, while fixed investment fell 0.2%. Net exports shed 1.1 points as exports rose 0.9% and imports 4.9%. On a yearly basis, the GDP rose by 0.9% in Q2, down from 1.9% in Q1 and missing the expected 1% growth.

Germany’s trade surplus widened to €21.3 billion in July 2026 from €15.4 billion in June, exceeding expectations of a rise to €16 billion and marking the largest trade surplus since August 2024, as exports fell less sharply than imports. Exports fell 0.8% month-on-month to €138.2 billion, compared with forecasts of no change, as sales to EU countries declined 1.6%, while shipments to third countries edged up 0.2%. Within third countries, the growth in exports was mainly driven by a 19.1% jump in exports to the US, while shipments to China and the UK fell 9.5% and 7.2%, respectively. Meanwhile, imports dropped 5.7% to €116.9 billion, with those from EU countries down 6.1% and from third countries falling 5.3%. Imports from China fell 7.5%, those from the US declined 8.2%, and those from the UK dropped 1%. From January to July, Germany’s trade surplus increased to €125.8 billion from €122.8 billion in the same period last year.

China’s trade surplus widened to $119.09 billion in August 2026, up from $101.01 billion a year earlier. Exports jumped 25% year-on-year to $401.44 billion, following a nearly 24% increase in July, as the global AI infrastructure buildout continued to boost trade across Asia. Shipments to the US surged 34.4%, lifting China’s surplus with the US to more than $29 billion, the widest gap since Donald Trump returned to the White House in January 2025. Washington is stepping up its rhetoric toward Beijing, urging China to boost domestic demand and reduce its reliance on exports for growth, ahead of a planned meeting between Chinese President Xi Jinping and US President Donald Trump later this month. Meanwhile, imports rose 28.2% to $282.36 billion, slightly below forecasts but accelerating from July’s 27.5% increase. In the first eight months of 2026, China’s trade surplus reached $806 billion, putting the annual figure on track to surpass last year’s record of $1.2 trillion.