Trump Assures Zelenskyy of US Support for Ukraine Security

GLOBAL MOOD: Risk-On
Drivers: US-Ukraine Peace Talks, Fed Easing Expectations, Jackson Hole Symposium

Investor sentiment leaned risk-on, supported by optimism around Ukraine-Russia peace talks and hopes of a potential easing cycle from the Federal Reserve. While the market remained cautious ahead of the Jackson Hole symposium to be held on Aug 21-23, positive geopolitical developments provided a temporary boost to risk assets.

TODAY’S WATCHLIST
- Euro June Current Account 
- Fed Bowman Speech
  
THE BIG STORY
US President Donald Trump pledged support for Ukraine’s security during a White House summit with President Volodymyr Zelenskyy and European allies, following his recent meeting with Russian President Vladimir Putin in Alaska. While the pledge signals US backing, the extent of assistance remains unclear, and a peace deal appears distant as Moscow has yet to accept trilateral talks. Trump expressed optimism that Putin seeks an end to the war, but the Russian Foreign Ministry reiterated that NATO troop deployment in Ukraine is not a viable solution.

Data Spotlight
US homebuilder sentiment fell unexpectedly in August, dropping to 32, the lowest reading in more than two-and-a-half years, down from 33 in July. Economists had forecasted a modest improvement to 34, but sentiment weakened as high mortgage rates and economic uncertainty continued to weigh buyers. Current sales slipped to 35, while sales expectations for the next six months remained steady at 43. Traffic of prospective buyers inched up to 22 but remained at a very low level, and 37% of builders reported cutting prices in August, like the past three months. 

Takeaway: US housing market sentiment remains weak, with builders cutting prices and offering incentives to attract buyers amid high mortgage rates and economic uncertainty, signalling continued softness in the residential construction sector. 

WHAT HAPPENED OVERNIGHT

• US stocks Ends flat Ahead of retail earnings and Jackson Hole
  
  • Markets awaited corporate earnings from key retailers including Walmart, Home Depot, and Target.
  • Investors focus also on the upcoming Federal Reserve symposium in Jackson Hole.

• US Treasury steady amid geopolitical developments
  
  • The 10-year US Treasury yield held above 4.3% as markets digested the Trump–Zelensky meeting.
  • Long-term yields rose faster than short-term rates, reflecting increased inflation expectations.

• US dollar fell amid Fed easing bets and geopolitical developments
  
  • US dollar index slipped a basket of currencies at 98.11, on wagers for more Fed easing.
  • Geopolitical developments, including Trump’s meeting with Zelensky, lifted the dollar index above 98.1.

• Crude oil rises on diplomatic talks between US and Ukraine
  
  • Brent crude oil futures settled 1.14% higher at $66.60 a barrel, US West Texas Intermediate crude rose 0.99% to $63.42 a barrel.
  • Gains followed discussions between US President Trump and his Ukrainian counterpart after last week’s inconclusive US-Russia summit in Alaska.

Day’s Ledger

Economic Data:

• Canada July Inflation Rate 
• Euro June Current Account 

Corporate Events:

• Earnings: Aditya Infotech, GNG Electronics, TSC India
• Tembo Global to consider fund raising

Policy:

• Fed Bowman Speech
• RBA Jones Speech  
• RBA McPhee Speech

Tickers to Watch

• GMR AIRPORTS board to consider fundraise at meeting Thursday
• HINDUSTAN ZINC board clears plan for new tailings reprocessing unit
• RELIANCE CONSUMER enters healthy functional beverages market
• VEDANTA board to meet Thursday to mull second interim dividend for FY26
• Vi looks at non-banking funding sources as interim solution for capex
• RITES targets ₹100 billion order book by FY26, eyes private sector growth

Must Read: 

• SEBI mulls glide path to enforce index caps on Nifty Bank, Bankex
• Jobless rate in Apr-Jun stood at 5.4%, shows first quarterly PLFS data
• SEBI proposes lower dilution norms, longer timelines for mega IPOs
• Centre releases ₹360.27 billion to states under special assistance scheme
• Mutual fund overseas assets fall 5.6% to $8.3 billion in FY25, says RBI
• European Trade takes fresh tariff hit as US exports slump
• Global economy took tariffs in its stride, but Stronger Headwinds are ahead
• China, India Seek Closer Ties to Counter US 'Bullying'
• SoftBank to Invest $2 Billion in Intel as Part of US Push
• Powell caught between inflation and unemployment as Jackson Hole approaches
• Gautam Adani says single geopolitical incident can restrict growth

See you tomorrow with another edition of The Morning Edge.

Have a great trading day.

Trade Tangles Didn’t Take a Weekend Off

As India enjoyed a long weekend, Washington kept tightening the tariff screws—from steel and aluminium to e-commerce parcels. Section 232 duties expand, “de minimis” ends on August 29, and tariff disputes under IEEPA and Section 301 intensify.

Trade expert Vijay Chauhan breaks down the latest tariff twist.  For India, risks remain, but the Alaska summit may have bought some time on secondary sanctions.