EMEA Morning Briefing: Trump-Xi Summit in Focus

MARKET WRAPS

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No major economic events or corporate trading updates expected

Opening Call:

European stock futures traded higher early Monday. Asian stock benchmarks strengthened; the dollar inched higher; Treasury yields were flat; while oil futures and gold weakened.

Equities:

Stock futures point to a higher open in Europe. Investors will closely watch a meeting in Washington on Thursday between President Trump and Chinese leader Xi Jinping for clues on the future trajectory of U.S.-China relations, MUFG strategists said.

While the leaders are expected to reaffirm high-level dialogue and achieve incremental progress on trade communications, the summit is expected to yield limited breakthroughs regarding technology controls, MUFG added.

Forex:

"We think FX should remain in a low volatility regime under a range of likely economic scenarios," Goldman Sachs said.

"On the one hand, the dollar should be supported by solid U.S. economic performance and bright prospective investment returns...on the other hand, negative dollar impulses have come mostly on the policy side. We think this back-and-forth can continue," GS said. Bonds:

The bond market has caught one bad break after another over the past several years, and it finally pushed the 10-year Treasury yield to a 19-year high above 5%.

The Covid-19 pandemic and then war have restricted the supply of goods, pushing inflation higher. At the same time, government deficits have flooded the market with bonds and fueled consumer spending.

Supply constraints and deficit-fueled demand have delivered a double blow to bonds, said Steve Boothe, head of global investment grade at T. Rowe Price. "I don't think you can look at one without considering the other."

Energy:

Oil declined in Asian trade. Initial concerns over extended disruptions to pipeline flows from Saudi Arabia seem to be easing, ANZ Research analysts said.

The country said that it expects the East-West pipeline to return to about half its capacity within days after it was shut down following a drone attack. However, the market is likely still focused on the longer-term fallout from the attacks by the Houthi militant group on the country, as the Iranian-backed group has been targeting energy infrastructure, ANZ added.

Metals:

Gold prices could remain constrained amid expectations for tighter U.S. monetary policy, with markets pricing in one more rate increase in 2026 and another in 2027, said Konstantinos Chrysikos of Kudo.com.

Traders will continue to monitor major central banks and the Fed this year for further monetary tightening signals, he adds. "Any firm messaging could push yields higher and pressure gold, while softer guidance may help a rebound," he said. Copper prices strengthened, supported by expectations for tightening supply and improving demand, Everbright Securities analysts said. China's copper inventories remain low, while global copper mine supply remains constrained, they added. Investors are monitoring the U.S.'s copper tariff policy and its potential impact on global trade flows, they said. Iron ore prices were higher in Asian trading. Overall iron-ore shipments remain on a seasonal upward trend, hovering at relatively high levels, Nanhua Futures analysts said. Steel mills are building inventory ahead of the coming long holiday in China, they noted.

TODAY'S TOP HEADLINES

A Shortage of Oil Tankers Is Threatening to Keep Gas Prices High

The Iran war has created a new shortage on the oil market. This time the scarce commodity isn't just crude-it is the ships that carry it.

Drone attacks that shut Saudi Arabia's bypass pipeline earlier this month have forced more crude back through the Strait of Hormuz and onto a tanker fleet already stretched thin. The impact has spread worldwide, as longer voyages and shuttle runs around Hormuz tie up ships and push the daily rate of hiring oil tankers to records.

The Silver Lining in Soaring Interest Rates: The Economy Can Handle Them

Some economists see a silver lining to the global surge in borrowing costs: the economy is strong enough to handle them.

Economies around the world are showing surprising resilience to higher central bank-interest rates and government bond yields that have jumped to multidecade highs across the developed world. The Federal Reserve, Bank of Japan and European Central Bank are among central banks that have lifted interest rates to contain inflation driven by the war with Iran.

Trump's Greenland Deal Eases Way for U.S. Business on Arctic Island

The security deal over Greenland, announced by President Trump on Friday, relieves the pressure from months of American maneuvering to control the semiautonomous Danish territory and smooths the way for more U.S. investments on the cash-starved but resource-rich Arctic island.

American and Greenlandic businesspeople say they hope the agreement, which is expected to be signed this week, will ease geopolitical tension, drive investment and remove some of the stigma many Greenlanders attach to cooperating with the Americans.

Volvo Recruits a Top VW Executive to Steer Its Turnaround

Volvo Cars named Klaus Zellmer as its next chief executive, poaching one of Volkswagen Group's top-performing brand chiefs to launch a raft of new vehicles and revive growth in a ferociously competitive market.

Zellmer, the current CEO of VW's Å koda, will succeed Håkan Samuelsson, a 75-year-old veteran of Volvo, no later than October 2027.

Refineries Are Now the Main Chokepoint for Global Energy Supplies

Persian Gulf states and Russia have invested tens of billions of dollars in refineries over the past decade to grab a bigger share of the global diesel market. Now, war in both regions has sent exports plunging, squeezing supplies of a fuel that powers much of the global economy.

Diesel prices are soaring-they eclipsed $6 a gallon in the U.S. for the first time this month and have kept climbing, hitting $6.45 on Friday. The surge has rattled governments and markets around the world that rely on diesel as the workhorse of their industry, transportation and agriculture. Shortages have appeared at gas stations in rural Brazil, in Libya and some African nations that can't afford to import the fuel.

Paramount Discussed $1.5 Billion California Investment to Clear Merger Hurdle

California's attorney general and Paramount have discussed a series of potential concessions as part of advanced settlement negotiations, including a $1.5 billion investment by the company in production in California, according to people familiar with the discussions.

Paramount executives and a coalition of states that sued to block its $81 billion merger with Warner Bros. Discovery spent the weekend hashing out the details of a possible settlement. Such an agreement would clear the way for a deal that would bring HBO, CBS, CNN, streaming services and famed movie studios under one owner.

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Expected Major Events for Monday 07:00/SPN: Jul Industrial Orders & Turnover

08:00/POL: Aug Average gross wages

08:00/ICE: Aug Harmonized CPI

08:30/UK: 2Q Business Finance Review

08:30/UK: S&P Global UK Consumer Sentiment Index

09:00/LUX: Aug Unemployment

10:00/UK: Aug Aluminium Production report

15:59/GRE: Jul Balance of Payments

16:59/LUX: 2Q Balance of Payments

17:59/POR: Jul ICSG Copper Report

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September 21, 2026 00:14 ET (04:14 GMT)