Category: Market News

Interest rates and energy prices are again playing a larger role in equity-market performance as investors assess monetary policy, inflation data and geopolitical developments, according to Barclays strategists.

Oil prices have risen amid the continuing U.S.-Iran standoff, while European gas prices have climbed to their highest levels since early 2023. They remain below the peaks reached during the 2022 Russia-Ukraine energy shock.

A Barclays team led by Emmanuel Cau said prolonged higher energy prices are adding to inflationary and interest-rate pressures. Markets are currently assigning roughly a two-thirds probability to a Federal Reserve rate increase in September following persistent inflation and hawkish remarks from Kevin Warsh at Jackson Hole.

Barclays economists have also changed their forecast, projecting two additional Fed rate increases during 2026, with moves expected in September and December.

The European Central Bank is expected to increase rates once more during September. However, the strategists said “upside risks increase if energy prices stay higher and stagflation concerns rise.”

At the same time, Barclays said a substantial amount of hawkish monetary policy expectations already appears to be reflected in markets. Signs of moderation in U.S. economic activity mean the payrolls report and the following week’s CPI data will provide additional information on the economic and policy outlook.

The strategists said earnings have helped equities absorb tighter financial conditions, but the effect of the second-quarter reporting season is diminishing.

“Equities have become more sensitive to rates and oil volatility recently, as the Q2 earnings tailwind is behind us and macro is back in the driver’s seat,” they wrote.

Barclays pointed to several potential market catalysts during the autumn, including central bank decisions, the U.S. midterm elections, Xi-Trump talks and geopolitical developments. Against that backdrop, the strategists said hedging and some tactical reduction in beta exposure “appears prudent.”

The team nevertheless maintained a supportive broader outlook through the end of the year, subject to interest rates and oil prices stabilising.

Barclays also assessed the potential market implications of progress towards a Russia-Ukraine truce. The strategists said the recent rise in European gas prices has paused the broadening of the region’s equity market performance and that credible movement towards an agreement could be welcomed by European markets, even without a final settlement.

“Cyclicals would likely be the main beneficiaries, at least tactically, with Autos, Materials and other energy-intensive sectors gaining from improving energy cost dynamics, while Infrastructure and Industrial names may benefit from growing expectations around Ukraine’s eventual reconstruction,” they noted.

Under that scenario, Barclays said energy, utilities and other defensive sectors could underperform.

European natural gas futures edged higher on Friday, stabilising after several volatile sessions as benchmark contracts headed towards a fourth consecutive weekly increase after reaching their highest levels since 2023.

The front-month Dutch TTF contract rose modestly, trading near €72.50 per megawatt-hour (MWh) and putting the European benchmark on course for a weekly gain of more than 8%.

In Great Britain, the equivalent NBP wholesale gas contract held near 179 pence per therm and was heading for a weekly increase of more than 9%, following Monday’s UK bank holiday.

Strait of Hormuz Disruption Remains in Focus

Gas markets continued to assess supply risks following military strikes involving U.S. forces and Iran and the resulting disruption to commercial tanker traffic through the Strait of Hormuz.

While Washington has maintained that international shipping lanes remain open, satellite tracking data cited in the report indicated that commercial vessel traffic through the waterway was running at a fraction of normal pre-war levels.

The Strait is an important route for global liquefied natural gas supplies, including exports from Qatar, with approximately 20% of worldwide LNG supply potentially exposed to disruption through the waterway.

U.S. President Donald Trump has warned of further strikes against Iranian infrastructure and raised the possibility of targeted action against Kharg Island.

European utilities are consequently competing with Asian buyers for alternative LNG cargoes from the Atlantic basin as markets assess the availability and cost of replacement supplies.

European Gas Storage Levels Stand at Around 62%

The supply uncertainty comes as Europe approaches the later stages of its summer storage injection season ahead of winter demand.

Data from Gas Infrastructure Europe showed European underground gas storage facilities at approximately 62% of capacity, below the five-year seasonal benchmark.

Storage replenishment during August was affected by higher gas-fired power generation during summer heatwaves in Southern Europe, scheduled maintenance on Norwegian offshore pipelines and delays to Qatari LNG shipments.

These factors have increased attention on the pace of storage injections during the remaining period before winter heating demand rises.

Higher Energy Prices Add to ECB Policy Considerations

The increase in European natural gas prices has coincided with Brent crude trading above $90 a barrel, adding to attention on the potential effect of energy costs on inflation.

The European Central Bank is due to hold its next Governing Council meeting on September 10.

Preliminary August data showed eurozone core inflation easing to 2.4%, while headline consumer price inflation accelerated to 3.3% year on year. Energy components increased 14.3%.

The combination of higher energy prices, inflation developments and signs of slower regional economic growth will form part of the economic backdrop assessed by policymakers as they consider the outlook for monetary policy.

Bitcoin (COIN:BTCUSD) extended its rebound on Friday, rising above $81,000 as lower U.S. Treasury yields reduced expectations for an imminent interest rate increase and cryptocurrency markets assessed potential regulatory developments in Washington.

Bitcoin was up 4.3% at $81,069.6 by 05:28 ET (09:28 GMT). The cryptocurrency had briefly moved above $82,000 on Thursday, reaching its highest level in almost four months.

The absence of further military action between the U.S. and Iran also coincided with the improvement in market sentiment.

Cryptocurrency-related equities participated in the advance, with Strategy, the largest corporate Bitcoin holder, rising nearly 18% during Thursday’s trading session.

Lower Rate Expectations Support Bitcoin Rebound

Bitcoin was on course to gain 4.3% for the week, putting the cryptocurrency on track for a third consecutive weekly advance.

The latest gains followed a decline in U.S. Treasury yields after Federal Reserve Governor Christopher Waller discussed the outlook for monetary policy.

Waller told Reuters that he was leaning towards leaving interest rates unchanged at the Federal Reserve’s September meeting, particularly if forthcoming inflation figures show that price pressures are moderating.

Expectations for a September rate increase subsequently declined. CME FedWatch showed a 50.4% probability of a hike, down from more than 60% earlier in the week.

The latest move follows a period of sensitivity to bond-market developments for Bitcoin, whose late-August advance was interrupted as Treasury yields increased.

Clarity Act Vote Expected on September 15

Regulatory developments were another focus for cryptocurrency markets after Securities and Exchange Commission Chair Paul Atkins commented on the Clarity Act.

Atkins said he expects the Senate to vote on the legislation on September 15. He also called for policymakers to approve the measure and send it to President Donald Trump by the end of the month.

The SEC is also preparing cryptocurrency legislation that could operate alongside the Clarity Act, according to Atkins.

Progress on the Clarity Act has previously been delayed by disagreements in Congress concerning stablecoin yield payments and proposed restrictions on cryptocurrency trading by policymakers.

Altcoins Join Broader Crypto Advance

Other major cryptocurrencies also recorded gains on Friday, with the broader market heading towards a third consecutive positive week.

Ethereum rose more than 5% to $2,522.53 and was up 4.3% for the week.

XRP advanced 6.6%, taking its weekly gain to 7%, while BNB increased 2.5% on Friday and 5% for the week.

Solana gained 3.9% and Cardano rose 8%. Dogecoin and $TRUMP also advanced, rising 5.8% and 8.1%, respectively.

Tomahawk Metals Plc (AQSE:TMHK) announced high-grade gold assay results from its Saturn Gold Project in Western Australia, with a top result of 38.16 g/t gold from a rock chip sample.

Keith Coughlan, Director: “These high-grade surface results provide an encouraging first indication of the potential at Saturn. During the site visit, we observed extensive quartz veining and historical workings across several prospect areas. The next phase will focus on systematic follow-up sampling, geological mapping and the preparation of drill targets to test the extent and continuity of mineralisation.” Read more

Sulnox Group PLC (AQSE:SNOX) received a Special Mention in the DecarbMine 2026 Challenge in Chile, selected from 63 submissions across 11 countries by an evaluation panel including Teck Resources and Lundin Mining. Read more

Connecting Excellence Group PLC (AQSE:XCE) signed Heads of Terms for its first acquisition, a specialist recruitment business with £1.79m revenue, while its flagship business Spencer Riley grew revenue 20% to £1.84m and strategic investor Adam Back increased his Bitcoin investment in the Company.

Scott Ellam, CEO: “Once completed, this will be our first recruitment company acquisition and the template for those that follow — two profitable companies trading as one business, with £1.79 million of revenue and £431,000 of EBITDA, for a net cash outflow of approximately £150,000 on completion.” Read more Read more

Sterling Digital Plc (AQSE:ASIC) announced its first verified Bitcoin mining output at its West Texas site, marking the first end-to-end operation of its gas-to-power-to-Bitcoin infrastructure.

Stefan Michaelides, CEO: “Recording our first verified Bitcoin mining output at our West Texas site is a defining operational milestone for Sterling. It demonstrates that the complete power plant infrastructure we have built can operate end-to-end under live conditions. Our focus is now on building upon this successful commissioning run as we advance towards continuous low-cost Bitcoin production.” Read more

Wishbone Gold Plc (AQSE:WSBN) registered a new 118km² tenement just 10km from the Havieron gold-copper mine in Western Australia, taking its total Telfer area portfolio to 628km². Read more

B HODL PLC (AQSE:HODL) completed its second At-the-Market equity offering, purchasing 1 BTC and bringing total Bitcoin holdings to 167.487 BTC. It also announced the launch of its third offering to continue growing Bitcoin per share. Read more

All Aquis Stock Exchange Announcements

Eurozone retail sales fell 0.6% in July compared with June, missing expectations for a 0.3% increase, as lower demand for non-food products outweighed an increase in purchases of food, drinks and tobacco, according to data released by Eurostat.

Sales of non-food products declined 1.4% month on month, while food, drinks and tobacco sales increased 0.4%. Sales of automotive fuel through specialised stores decreased 0.8%.

Across the wider European Union, retail trade volumes fell 0.4% in July. Non-food sales declined 1.1% and automotive fuel sales also dropped 1.1%, while purchases of food, drinks and tobacco increased 0.3%.

Germany Records Largest Monthly Decline

Among the reported member states, Germany registered the largest monthly decline in eurozone retail sales, with volumes falling 3.4%.

Spain recorded a 0.9% decrease, while retail sales in Italy and Poland both fell 0.3%.

At the other end of the rankings, Latvia posted the largest monthly increase at 2.5%, followed by Cyprus at 2% and Luxembourg at 1.8%.

Eurozone Retail Sales Rise 0.6% Year on Year

Compared with July 2025, the calendar-adjusted retail sales index increased 0.6% in the eurozone and 1% across the EU.

Eurozone sales of food, drinks and tobacco increased 1.6% year on year, while non-food product sales edged 0.2% higher. Automotive fuel sales declined 3.1%.

Cyprus recorded the largest annual increase among member states at 8.6%, followed by Latvia at 7.1% and Sweden at 6.4%.

Romania registered the largest year-on-year decline, with sales falling 5.7%. Germany recorded a 2.5% decrease and Italy posted a 1% decline.

Eurostat Revises June Retail Sales Data

Eurostat also revised its retail sales figures for June.

The monthly change was revised to an increase of 0.2% in both the eurozone and the EU. The previous estimates had indicated a 0.3% decline in the eurozone and a 0.1% decrease across the EU.

June’s annual growth rate was revised to 1.4% for the eurozone and 1.7% for the EU, compared with the previously reported rates of 0.7% and 1.2%, respectively.

Morgan Stanley identified Eni (BIT:ENI) as having the highest projected production growth among the European oil majors covered in its latest analysis of approximately 4,000 oil and gas fields.

The bank’s research estimated aggregate production growth for the sector at an annual rate of 2.9% between 2025 and 2030, up from 1.2% in its previous year’s forecast. Rolling four-year forward production increased by 8.3%.

The analysis used bottom-up information from multiple data consultants to assess production trends across major European energy companies.

Eni Production Growth Forecast at 4.5%

Eni recorded the highest projected production growth among the companies included in the study, with Morgan Stanley forecasting growth of 4.5% through 2030.

The bank’s analysis indicated that Eni’s production could continue increasing through 2034.

By comparison, Equinor (TG:DNQ) was identified as facing the largest production growth challenges among the European majors covered by the research.

Morgan Stanley Upgrades Shell to Overweight

Morgan Stanley also upgraded Shell (LSE:SHEL) to Overweight and designated the company as a Top Pick.

The bank expects a total shareholder return of 15% and anticipates an acceleration in dividend per share following recent changes in the business.

The rating and shareholder return expectations represent Morgan Stanley’s assessment rather than a guarantee of future performance.

BP Retains Overweight Rating

Morgan Stanley maintained its Overweight rating on BP (LSE:BP.).

The firm cited its expectations that BP could reduce net debt faster than the company’s stated targets, alongside its assessment of the company’s valuation and potential catalysts.

The research forms part of Morgan Stanley’s broader assessment of production growth and shareholder returns among Europe’s major oil and gas companies.