EMEA Morning Briefing: Stock Futures Fall Amid Skepticism Over U.S. Treasury's Buyback Plan

MARKET WRAPS

Watch For:

Flash PMI for EU, U.K., France, Germany; EU flash consumer confidence indicator; U.K. public sector finances, retail sales; no major corporate updates expected

Opening Call:

European stock futures edged lower early Friday. Asian stock benchmarks were mixed; the dollar weakened and Treasury yields were unchanged; oil was mixed; gold gained.

Equities:

Stock futures in Europe were tracking lower as investors signaled doubts over the U.S. Treasury Department's plan for bond repurchases.

U.S. Treasury Secretary Scott Bessent's move this week to ratchet up bond repurchases temporarily cooled yields on government debt, but yields rebounded Thursday near some of their highest levels in years.

"The main theme overnight was a fading of the so-called Bessent put, as markets concluded that the Treasury's bond-buyback program offers only a short-term fix," Commerzbank Research analysts said in a note.

Given that AI is one of the key engines of economic growth, "sustaining the AI buildout requires heavy capital spending that increasingly competes with Treasury issuance for the same pool of investor capital," market strategist James Ooi of Tiger Brokers said.

Forex:

The U.S. dollar weakened on skepticism over the U.S. Treasury Department's bond buyback plan. The plan "failed to anchor long-term [U.S.] yields for now, raising doubts whether Treasury buybacks can sustainably lower borrowing costs against persistent fiscal and structural pressures," strategists at OCBC Group Research said.

"So far, the surprise buyback program has coincided with a weaker USD, higher gold prices and rising breakeven inflation rates," the strategists added.

Bonds:

U.S. Treasury yields were unchanged. "The combination of rising oil prices and renewed skepticism over the Treasury's ability to cap long-term borrowing costs weighed on U.S. Treasurys," Commerzbank Research analysts said.

On CNBC, Bessent emphasized that buybacks could exceed $4 billion per operation, saying the government has "a big toolkit" to bring down yields. Bessent also pushed back on deficit worries, saying much of the gap reflected temporary tariff refunds and business investment incentives.

However, "markets do not seem to be buying into the ability of the U.S. to credibly consolidate its fiscal deficit so far," says Michael Wan, senior currency analyst at MUFG Bank.

Energy:

Oil futures were mixed. "Hopes for a near-term peace deal faded after the 60-day negotiating window expired without a breakthrough, prompting some of the earlier optimism priced into crude to unwind," market strategist James Ooi of Tiger Brokers said.

Still, as markets adjust to the idea of a persistent disruption, and industries start finding alternative routes around the Strait of Hormuz, there may be less room for prices to rise without a fresh escalation or supply losses worsening, he said.

Metals:

Gold gained. The precious metal is likely to continue reacting to changing monetary policy expectations, said Critical Metals' Tony Sage. Gold prices could be weighed by expectations from Federal Reserve officials that monetary policy tightening could be required if inflation doesn't come down.

Coming economic data releases, including job market and inflation figures, could affect sentiment, with softer readings likely to fuel bets on a less hawkish Fed, he added.

Copper futures rose. Prices for the base metal were likely to remain supported by tight physical supply, said ING strategists.

The copper market remains vulnerable after months of outflows, driven partly by the diversion of metal to the U.S. ahead of expected tariffs. Still, further inventory inflows of copper could ease near-term pressure and trigger volatility in prices, they said.

Iron ore edged lower. Prices are under pressure on expectations of ample supply in the second half of the year, Nanhua Futures analysts said. That said, prices may find some support from improved demand.

The analysts added that international shipping rates, which have risen slightly, will be in focus, as they will have an impact on iron-ore prices.

TODAY'S TOP HEADLINES

Private Credit's Next Big Thing Is $1 Trillion in British Pensions

LONDON-Private credit giants have found a $1 trillion-plus source of capital to invest: dowdy old British pensions.

London's Standard Life said on Thursday it struck a deal to invest in private-market assets supplied by buyout company CVC Capital Partners, Goldman Sachs and PGIM, the asset-management arm of Prudential Financial. The U.K. insurer said the partnership would help boost its business taking over the management of defined pension plans from companies.

The biggest loser from the Treasury's latest buyback plan: The U.S. dollar. Here's why.

Bond traders briefly cheered after the Treasury Department said it would double its planned buybacks of longer-dated notes and bonds, but yields kept pushing higher on Thursday, despite Treasury Secretary Scott Bessent taking to CNBC to try to calm things down.

See: The rise in interest rates hit a 'raw nerve' at the White House. Bessent's plan has analysts on edge.

James Hardie Selling European Fermacell Business for $980 Million to Holcim

James Hardie Industries will sell its European Fermacell business to Swiss building-materials company Holcim as it seeks to focus on higher-growth and higher-return markets.

The provider of exterior home and outdoor living solutions will receive EUR840 million in cash, or about $980 million, from the sale, the company said Thursday. The transaction is expected to close in the first half of next year.

Novonesis Leads Europe's Stoxx 600 on Sales Beat, Guidance Raise

Novonesis shares led the Europe-wide Stoxx 600 after the Danish biosolutions group reported sharp sales growth and upgraded its guidance.

Copenhagen-listed shares jumped more than 10% to a one-year high of 455.50 Danish kroner in early afternoon European trade. Shares are currently up 12% over the year to date.

Layoffs at JPMorgan Hit Highest Level Since 2015

On JPMorgan Chase's quarterly earnings call last month, CEO Jamie Dimon said the banking environment is "getting close to as good as it gets."

With consumers in solid shape, investors piling into stock market bets, companies calling on investment bankers, and spenders paying up for credit card perks, the firm notched record revenue in its three major divisions last quarter. The market is thrilled: JPMorgan's stock has hit 17 new all-time highs this year.

Abbott to Pay $670 Million to Settle Baby-Formula Litigation

Abbott agreed to pay $670 million to resolve a lawsuit over its specialty formulas for premature infants as well as about 2,000 related claims.

The bulk settlement relates to the Gill lawsuit, in which a Missouri jury ordered Abbott to pay $495 million in damages after determining the company failed to warn that its formula for preterm infants increased the risk for a bowel disease. Abbott's appeal to the 2024 verdict was denied.

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Expected Major Events for Friday 04:30/NED: Aug Consumer confidence survey

04:30/NED: Jul House Price Index

06:00/UK: Jul Public sector finances

06:00/DEN: Aug Consumer expectations

06:00/SWE: Jul Labour Force Survey

06:00/DEN: Aug Business tendency survey

06:00/UK: Jul Retail sales

06:45/FRA: Aug Monthly business survey (goods-producing industries)

07:15/FRA: Aug France Flash PMI

07:30/GER: Aug Germany Flash PMI

08:00/EU: Aug Eurozone Flash PMI

08:00/POL: Jul Agricultural prices

08:00/ICE: Jul Harmonized CPI

08:30/UK: Aug Flash UK PMI

09:00/BEL: Aug Consumer Confidence Survey

10:00/IRL: Jul WPI

14:00/EU: Aug FCCI Flash Consumer Confidence Indicator

15:59/UKR: Jul PPI

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August 21, 2026 00:17 ET (04:17 GMT)