Overnight Recap

Ranked drivers since Friday's 6:00 PM ET close:

Previous Session Context

• Friday's US cash session closed higher (deterministic snapshot: cash direction "higher") even after a hotter-than-expected August core CPI — gold oddly rallied Friday despite the print (ForexLive, 04:16 ET). Everything since is repricing on top of that hike-heavy base.
• Saturday wrap — "Stocks Slide as AI and Oil Deliver Double Blow" (Bloomberg, Sat 18:06 ET): global equities fell worldwide after the AI-slowdown proposal landed, with US 10y near 4.96% and the weekend oil surge compounding. This established both legs of today's selloff before the pipeline attack added the third.
• VIX 18.13, +14.5% on the day, per the Sunday evening MarketWatch snapshot (21:00 ET) — hedging demand arrived over the weekend, not Friday.

Global Equity Movers

Asia (Monday close):

• Nikkei 225 -0.81% to 63,493 — six-week low, as JGB 10y sits near 3.00% into Friday's BOJ meeting and AI-safety fears hit the chip complex: Kioxia -6.4%, Advantest -2% (TradingEconomics, 06:58 ET).
• Kospi -3.3% — worst major index; SK Hynix -5%, Samsung -2.9% on the AI-slowdown repricing plus Fed hike fears; first session of Korea's extended trading hours (Seoul Economic Daily; Investing.com).
• Hang Seng +0.2% — the AI complex still fell: Z.AI -7.5% on a ~$5B placement (shares priced at a discount to the previous close) and broader HK tech pressure (Investing.com).
• Shanghai Composite ~flat — Beijing stimulus hopes (August credit miss strengthens the case) offset the regional risk-off (Bloomberg, 05:13 ET).
• MSCI Asia-Pacific index about -0.5% (Investing.com).

Europe (morning):

• Eurostoxx 50 -0.6%; European tech at a six-week low, AI-linked names down as much as ~13% at the open (Guardian live, 05:32 ET).
• DAX -0.3%, CAC 40 -0.4%; FTSE 100 +0.3% the lone gainer on energy majors and rotation into AI "losers" — RELX +4.2% (ForexLive, 03:15 ET).

US pre-market single stocks:

• NVDA -3% — AI-slowdown repricing leads chipmakers lower (ForexLive, 05:58 ET).
• AMD -4.8% — hit hardest among US chipmakers despite a bullish Stifel reiteration (Buy, $635 target; MI450/Helios revenue on schedule) (Forbes premarket; Business Insider, Sat 10:00 ET).
• ORCL lower; Stifel maintained Buy but cut its target to $200 from $220 on near-term cloud cost pressure (Business Insider, Sat 10:00 ET).
• Energy majors (XOM, CVX) bid with WTI above $102 on the pipeline shutdown — no individual pre-market prints confirmed; FTSE energy strength is the read-across (estimated, direction inferred from sector tape).
• Airlines pressured on fuel costs; Air Baltic filed for Chapter 11 restructuring citing high fuel prices among pressures (Bloomberg, 03:08 ET).

Rates, FX, and Commodities

US Treasuries are bid into the risk-off, with the long end outperforming: 10y is around 4.97%, roughly 1bp lower on the day and still closing in on 5%; 30y ~5.35% (-2bp); 2y ~4.63% and steady, leaving 2s10s near +34bp (TradingEconomics/MarketWatch pre-market reads; futures confirm: TY1 +0.10%, US1 +0.21%, TU1 +0.02%). The curve's message is growth fear at the long end meeting a firm policy path at the front — Amundi, Europe's largest asset manager, is buying 2-year Treasuries explicitly as insurance against an oil-driven slowdown (Bloomberg, 04:54 ET). The dollar is modestly firmer, DXY around 99.0–99.5 (+0.05% to +0.4% intraday; exact pre-cash-open print unconfirmed). Oil is the story: Brent +2.7% to ~$107.5 after touching $108.03, WTI $102.7 +2.7%, natural gas +2.5% to $2.90 — the Saudi pipeline shutdown plus postponed Hormuz talks keep a war premium priced with no diplomatic off-ramp this week. Gold is the outlier haven: -1.9% to ~$4,327, testing major $4,300 support, because hike bets lift real yields faster than war risk lifts bullion (ForexLive, 04:16 ET; Bloomberg, Sat 20:33 ET). Central banks converge hawkish: the ECB hiked 25bp last week and Kazimir says it "won't hesitate to hike further if needed" (Bloomberg, 04:00 ET); the BOE's dovish majority is being tested by Iran-war inflation into Thursday's decision (Bloomberg, 00:00 ET); the BOJ is expected to add its own hike Friday.

Today's Setup and Risk Map

Calendar (ET, all times scheduled/consensus as cited):

• Wednesday 2:00 PM — FOMC rate decision with the Summary of Economic Projections; Warsh presser 2:30 PM. ~87% priced for +25bp (ForexLive; CME-cited desks as high as 90%). First decision of the Warsh chairmanship against open White House pressure for cuts.
• Wednesday — US retail sales (August); Thursday — weekly jobless claims, Bank of England decision; Friday — Bank of Japan decision (hike widely expected; would be the fastest BOJ hiking pace on record). Also this week: UK CPI Wednesday, eurozone HICP Thursday (ForexLive week outlook, 03:32 ET).
• Earnings season is quiet at the top today — no ≥$20B reporters; the heavy tape this week is central banks, not prints.

Levels to watch (front-month, 06:00 ET snapshot): ES1 7596 (-0.8%), NQ1 28856 (-1.8%), RTY1 2916 (-0.3%), WTI 102.7, Brent ~107.5, gold 4,327 vs the 4,300 major, 10y ~4.97% vs 5.00%.

Scenarios:

• Bull: Hormuz talks un-postpone or a Saudi pipeline restart headline cracks the oil premium; AI-selloff exhausts at the Friday cash gap; S&P reclaims the pre-pipeline path and tech bounces into Wednesday as a hike is already priced.
• Base: Powered by the status quo — oil holds the war premium, Fed hikes 25bp Wednesday as priced, market trades the range with tech underperforming and energy/defensives outperforming through the print.
• Bear: The dot plot validates a series of hikes (not one), or a new Hormuz/Saudi escalation pushes Brent through $110 — the 10y through 5% plus $110 oil is the compounding scenario for a multi-percent index drawdown.

Biggest risk to the base case: a hawkish SEP on Wednesday — a single 25bp hike is already paid for; a dot plot implying more, against $107 oil, is not.