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Manufacturing PMI data for EU, U.K., Germany, France, Italy; CPI data for EU, Italy; EU unemployment; U.K. Nationwide house price index, money and credit; trading updates from Sasol, Bunzl, Sibanye Stillwater

Opening Call:

European stock futures tracked lower early Tuesday in tandem with declines in Asian stock benchmarks; the U.S. dollar strengthened; Treasury yields rose; oil futures and gold gained.

Equities:

Stock futures in Europe fell as renewed tensions in the Middle East drove oil prices higher and fueled inflation concerns.

The recent exchange of attacks between the U.S. and Iran prompted President Trump to say the U.S. would "hit them hard." American forces said they had hit Iranian launch sites that were preparing to fire rockets used to deploy naval mines in the Strait of Hormuz. In return, Tehran fired a salvo of missiles at Jordan, which is home to thousands of American troops. All were intercepted.

"The main theme was the renewed escalation in the U.S.-Iran conflict," Commerzbank Research analysts said. "The renewed hostilities dashed recent hopes of progress toward normalizing shipping through the strait." Trump "also signaled that Washington was prepared to conduct further attacks," the analysts added.

Forex:

The U.S. dollar gained amid ongoing tensions in the Middle East. "The U.S. struck Iranian rocket launchers on Larak Island and Iran retaliated against bases hosting U.S. forces in Jordan, with additional incidents reported around the U.A.E. and the Strait of Hormuz," NAB's Rodrigo Catril said. The rise in oil prices triggered risk-off sentiment, the senior FX strategist added.

Bonds:

U.S. government bond yields rose as higher crude oil prices stoked inflation worries and prospects of tighter monetary policy among central banks.

"A resumption of kinetic U.S.-Iran conflict has lifted oil along with UST yields," said Vishnu Varathan, head of Macro Strategy for APAC at Mizuho Securities (Singapore).

"With Brent oil prices still overall contained but inching up above the US$90/bbl, markets remain slightly unsure as to how the war in the Middle East will play out and the impact to" bond yields in Asia, said Michael Wan, senior currency analyst at MUFG Bank.

"Both the [overnight index swap] and Fed fund futures markets are now pricing in for around 70% probability of a September hike" by the Fed, Wan added.

Energy:

Oil prices rose as renewed hostilities stretched the Middle East conflict into its seventh month. Oil prices jumped with Brent oil climbing back above $90 [per barrel], reviving inflation concerns and spilling into equities and government bonds, said Rodrigo Catril, senior FX strategist at National Australia Bank.

"Officials from both sides are now preparing for the conflict to drag on for months as talks are deadlocked," ANZ Research analysts said.

Metals:

Gold advanced. The macro environment has become more supportive with softer U.S. data, easing yield pressures and a less consistently strong U.S. dollar which helps precious metals regain momentum, OCBC Group Research said.

While Fed chief Warsh's Jackson Hole speech may temporarily limit near-term upside on concerns of Fed rate hikes, it doesn't substantially affect the broader picture, including structural supports like central bank demand for gold and persistent supply constraints in silver, OCBC added.

Copper gained. Supply-side issues remain, as data highlight challenges ahead for the copper market, ANZ Research analysts said. The world's top copper producer, Chile, reported that output fell 9.4% in July from a year earlier, ANZ noted, citing data from the national statistics agency.

TODAY'S TOP HEADLINES

Fighting Flares in Middle East After U.S. Strike on Iranian Rocket Launchers

WASHINGTON-U.S. forces attacked two Iranian rocket launchers in the Strait of Hormuz on Sunday, the U.S. Central Command said, marking the first American strike in weeks and heightening the risk of a return to all-out conflict in a region already battered by war.

The command said that the Iranian launchers, which were deployed on Larak Island, were preparing to fire rockets filled with sea mines into the strait when they were struck.

SEC Presses Investment Firms to Prove They Have Access to Shares in Hot Startups

The Securities and Exchange Commission has stepped up its examinations of firms behind so-called special purpose vehicles that purport to offer exposure to private company investments.

SEC examiners have been asking registered investment advisers for proof that their SPVs own or have exposure to the shares in private companies that they claim to, according to people familiar with the matter.

Mine Warfare With Iran Hampers U.S. Efforts to Win Control of Hormuz

The U.S. decision to strike Iran for the first time in a month shows Washington's determination to win its cat-and-mouse contest for control over the Strait of Hormuz even at the risk of an escalation that could turn the conflict back into a hot war.

American forces said they hit Iranian launch sites that were preparing to fire rockets used to deploy naval mines in the narrow waters of the strait. In return, Tehran fired a salvo of missiles at Jordan, which is home to thousands of American troops. All were intercepted.

Washington's Deadly New Headache: an al Qaeda-Houthi Terrorist Alliance

On a balmy evening, Jibril "One-Armed" Yahya Ali and his new bride set out for a honeymoon drive along the beach outside al-Ghaydah, Yemen.

Jibril, a Somali, and his Yemeni wife had met through a mutual acquaintance, an arms dealer who helped Jibril buy military-grade weapons from Yemen's Houthi rebels. Jibril would then smuggle the arms to al-Shabaab, an Islamist insurgent group fighting to overthrow the government in Somalia.

Anthropic Signs $35 Billion Cloud Deal Backed by Nvidia

Anthropic has signed a cloud-computing deal worth $35 billion with Nvidia-backed cloud provider Lambda, with Nvidia itself holding the lease on the data center, according to people familiar with the deal.

The data center is being developed by Hut 8, a bitcoin miner and data-center developer, in Nueces County, Texas. Nvidia signed an agreement with Hut 8 a few weeks ago to secure the capacity, the people said.

Shein's Shares Fall in Long-Awaited Hong Kong Debut

Fast-fashion giant Shein slid in its long-awaited trading debut, as regulatory headwinds and slowing sales challenge a company once valued at about US$66 billion.

The retailer's stock fell tumbled as much as 10% in early trading in Hong Kong after an initial public offering that valued the company at roughly a quarter of its peak.

Write to singaporeeditors@dowjones.com

Expected Major Events for Tuesday 00:01/IRL: Aug Ireland Manufacturing PMI

04:30/NED: Jul Retail turnover

04:30/NED: Aug Flash Estimate CPI

05:00/NED: Aug Netherlands Manufacturing PMI

06:00/GER: Jul Retail Trade

06:00/UK: Aug Nationwide House Price Index

06:30/SWI: Jul Retail Sales

06:30/HUN: 2Q GDP

07:00/POL: Aug Poland Manufacturing PMI

07:00/TUR: Aug Turkey Manufacturing PMI

07:15/SPN: Aug Spain Manufacturing PMI

07:30/CZE: Aug Czech Republic Manufacturing PMI

07:30/SWI: Aug procure.ch Purchasing Managers' Index

07:45/ITA: Aug Italy Manufacturing PMI

07:50/FRA: Aug France Manufacturing PMI

07:55/GER: Aug Germany Manufacturing PMI

08:00/ITA: 2Q GDP

08:00/EU: Aug Eurozone Manufacturing PMI

08:00/GRE: Aug Greece Manufacturing PMI

08:30/UK: Jul Bank of England effective interest rates

08:30/UK: Jul Monetary & Financial Statistics

08:30/UK: Jul Money and Credit - Lending to Individuals, Lending to Businesses, Broad Money and Credit

08:30/ITA: Jul Unemployment

08:30/UK: Aug S&P Global UK Manufacturing PMI

08:30/UK: 2Q Household Finance Review

09:00/ITA: Aug Cities CPI

09:00/ITA: Aug Provisional CPI

09:00/EU: Jul Unemployment

09:00/CYP: Jul Retail trade

09:00/CYP: 2Q GDP

09:00/EU: Aug Flash Estimate euro area inflation

10:00/POR: Jul Industrial production index

16:59/AUT: Aug Unemployment figures

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