Market Wrap: European NATGAS futures surge nearly 4%; luxury sector sees stronger demand coming in China (34.08.2026)

📊 Indices and Companies

• The European session has a mixed character and is trading relatively quietly compared to last week's volatility (VSTOXX: -0.6%; EU50: -0.15%).

• Futures on the German DAX (DE4), Dutch AEX (NED25), and UK FTSE 100 (UK100) are trading flat, while Italy (ITA40: -0.15%), France (FRA40: -0.15%), Poland (W20: -0.2%), and Switzerland (SUI20: -0.4%) are posting losses. An optimistic exception is Spain's IBEX 35 (SPA35: +0.3%).

• Consumer goods companies, particularly luxury, fashion, and beauty names, stand out in Europe today (Hermes: +1.3%, LVMH: +1.1%, L’Oréal: +1.3%). The European financial sector (UniCredit: +1.05%; Deutsche Bank: +0.5%, Santander: +0.75%) and materials (BASF: +1.5%, Air Liquide: +0.6%) are also in the green. Energy and healthcare are lagging the most.

• European luxury companies are seeing the first signs of stabilization and a demand rebound in China, driven primarily by high-net-worth consumers. Although the market remains under strong pressure from capital outflow controls and taxation, forecasts point to improved performance in Q4. Key beneficiaries of this trend include Hermes, Kering, Burberry, and LVMH.

• SSAB, Norsk Hydro: Shares of European steelmaker SSAB and aluminum supplier Norsk Hydro rose following the lack of a tariff agreement between the US and Canada. Maintaining existing trade barriers leaves highly favorable conditions intact for both companies. SSAB retains a local advantage in the US plate market, while Norsk Hydro benefits from preferential recycling rules in the US.

• Alibaba: The company raised $10.2 billion in a record Hong Kong share placement to fund AI infrastructure, triggering an 8.5% drop in its stock. Despite share purchases by executive management, investors are concerned about earnings dilution and high capital expenditures. Additionally, prominent investor Michael Burry criticized the new issuance and announced he sold his entire position.

• Shein: The company plans to raise up to $1.8 billion in its Hong Kong stock exchange debut, targeting a valuation of around $27 billion. This represents a significant drop from the $100 billion valuation achieved in 2022, resulting from financial losses, higher tariffs, and US regulatory scrutiny. The company's market debut is scheduled for September 1.

• Shell has attracted interest from potential buyers, including industry giants ExxonMobil, LyondellBasell, Kuwait Petroleum Corp. (KPC), and private equity firm Apollo, regarding the sale of its US chemicals business. Non-binding preliminary offers value the assets at up to $8 billion, representing a steep discount to past capital investments. The transaction fits into Shell's ongoing strategy of divesting less profitable assets.

🌍 Economy and Geopolitics

• The Canadian government is preparing a support package for domestic businesses following the breakdown of trade talks with the US and Donald Trump's imposition of 50% tariffs. Prime Minister Mark Carney expects the trade dispute to last at least until the US midterm elections or through the remainder of Trump's term. Canada's retaliatory tariffs are set to take effect on September 8.

• ECB's Piero Cipollone stated that he currently sees no stagflation risks in the Eurozone, adding that inflation is far from being dangerous.

• French Finance Minister Lescure announced he will not propose new taxes to address the growing budget deficit. The sell-off in French debt in recent weeks has pushed the spread between French and German 10-year bonds to its highest level since 2024, just below the peak reached prior to the snap election following Emmanuel Macron's dissolution of parliament (87 bps; compared to 88 bps in 2024).

💱 Currencies and Commodities

• FX: The US Dollar Index (USDIDX) is rebounding around 0.2% from a 3-month low following a nearly 0.9% drop last week. The Canadian dollar remains the weakest currency of the session (USDCAD: +0.35%), while other G10 currencies are paring losses against the USD. EURUSD is down just 0.04% (after dipping -0.15% at its session trough).

• Brent crude futures (OIL) are down 0.9% to $91.30 per barrel, while natural gas futures are charging higher on both NYMEX (NATGAS: +3%) and in Europe (NATGAS.EU: +3.1%).

• Precious metals continue their gains despite the dollar's attempt to rebound. Gold is adding 1.3% to $4,660 per ounce, while silver gains 0.5% to $69.30 per ounce.

🪙 Cryptocurrencies

• Bitcoin is stabilizing near $77,800 following a 24% weekly gain driven by spot market buying and short position liquidations. Ethereum and Solana recorded a similar pattern, where price gains were accompanied by a decline in open interest on futures contracts. This points to the dominance of organic spot demand rather than leverage accumulation.