TL;DR

Nvidia-led tech selloff hits global equities; US expands tariffs; UK inflation complicates BoE policy.

Highlights

• Nvidia ’s 3.5% drop sparked a global tech selloff; Nikkei fell 1.5%, SoftBank tumbled up to 9%320.
• Bank Indonesia and RBNZ cut rates unexpectedly, citing weak growth; NZD and IDR weakened, local bonds rallied45.
• UK inflation rose to 3.8%, above consensus and G7 peers, complicating BoE’s easing outlook; sterling edged higher6.
• China held loan prime rates steady for a third month despite weak data, favoring targeted support7.
• US imposed 50% tariffs on 400+ steel/aluminum products and expanded Xinjiang forced-labor import bans89.
• Japan’s exports fell for a third month, led by a 28% drop in US-bound autos due to tariffs11.
• China pressed solar firms to cut overcapacity and end price wars; major sector restructuring is underway10.
• Kenya is negotiating a $5B debt swap into yuan as China considers yuan-backed stablecoins to boost RMB’s global role12.
• Bitcoin fell below $113,000, triggering $559M in liquidations; crypto and equities pressured by rising US yields13.
• Geopolitical risks: Russian drone exploded in Poland (first such incident)2, Israel readies Gaza offensive15, Iran unveils advanced missiles14, North Korea orders rapid nuclear expansion16.
• Russia pledged uninterrupted oil trade with India as new US tariffs target Indian goods; 90% of bilateral trade now in rupees/roubles 18.
• Putin agreed to next phase of Ukraine peace talks, including a possible direct meeting with Zelensky19.

Commentary

A sharp reversal in global tech stocks—triggered by Nvidia ’s decline—has spread across US and Asian markets, hitting chipmakers and tech conglomerates particularly hard320. Risk aversion is rising ahead of Fed Chair Powell’s Jackson Hole speech, with traders reassessing the likelihood of US rate cuts amid persistent inflation, as seen in the UK’s upside surprise6. Higher Treasury yields and a stronger dollar are weighing on both equities and cryptocurrencies, with Bitcoin ’s slide and forced liquidations highlighting a broader reduction in risk appetite13.

Monetary policy divergence is becoming more pronounced. Bank Indonesia and the Reserve Bank of New Zealand both surprised with rate cuts to support growth, weakening their currencies (IDR , NZD ) and boosting local bonds45. However, further easing could be limited if capital outflows accelerate. In contrast, China is maintaining steady policy rates despite softening economic data, opting for targeted sector support—most notably in solar, where authorities are pushing for consolidation to address severe overcapacity710.

Trade tensions remain a key headwind. The US has expanded tariffs on steel, aluminum, and a wide range of finished goods, while also tightening forced-labor import bans89. These measures are impacting supply chains in Asia and Europe, with Japan’s auto exports to the US particularly affected11. The eurozone is feeling the aftershocks as well, with ECB President Lagarde noting that growth is cooling as the effects of pre-tariff stockpiling fade17. Meanwhile, Kenya’s proposed yuan debt swap and China’s potential move toward yuan-backed stablecoins underscore ongoing efforts to diversify away from the dollar in global finance12.

Geopolitical risk remains elevated. The Russian drone incident in Poland2, Israel’s Gaza mobilization15, Iran’s missile escalation14, and North Korea’s nuclear expansion16 all add to market uncertainty. Russia’s assurance of continued oil trade with India, despite new US tariffs, highlights the ongoing fragmentation of global trade flows and payment systems18. The next phase of Ukraine peace talks, if productive, could offer a modest reduction in regional risk, but headline sensitivity remains high19.

Traders should monitor Jackson Hole for US rate signals, watch for further volatility in tech and crypto, and remain alert to trade and geopolitical developments that could trigger further market moves.