Bitcoin Recovers as Traders Shrug Off Nvidia Stumble — Market Talk

0807 GMT - Bitcoin recovers modestly from recent losses as investors shrug off Nvidia's underwhelming earnings report, MH Markets analyst Mohammed Taha says. Risk sentiment is bolstered by expectations that the Federal Reserve will resume interest-rate cuts soon ahead of Friday's U.S. personal consumption expenditures price data, he says. A lower-than-expected print could reinforce hopes for a September rate cut, historically a tailwind for risky assets like bitcoin, he says. "Moreover, the U.S. strategic bitcoin reserve initiative, despite its limitations to forfeited assets, continues to signal long-term governmental support, sustaining institutional interest." Bitcoin rises 0.7% to $113,199, LSEG data show. Nvidia's shares fell in postclose trade after its second quarter results included a narrow revenue miss in a key data-center segment. (renae.dyer@wsj.com)

0755 GMT - The dollar would only rise briefly if upcoming U.S. economic data boost the currency, ING's Chris Turner says in a note. The second estimate of U.S. gross domestic product for the second quarter at 1230 GMT could be revised slightly higher, he says. Weekly jobless claims data are also due at 1230 GMT while pending home sales figures will be released at 1400 GMT. Any dollar rally on the back on the data is unlikely to last as Federal Reserve official Christopher Waller speaks at 2200 GMT, Turner says. Waller, a Trump appointee, could strengthen his calls for interest-rate cuts after the July nonfarm payrolls report validated his concerns over the weakening labor market, he says. (renae.dyer@wsj.com)

0748 GMT - India's tax reform plan could offset the economic hit from U.S. tariffs, say analysts at BMI, a unit of Fitch Solutions. Under the proposed changes, the goods and services tax will be simplified and the average tax rate reduced. While GST has become the second-largest source of fiscal revenue for the government, BMI expects the reform to have only a minor impact on GST revenues. It should also boost private consumption. "Depending on the details, this boost could be enough to cancel out the tariff drag and for now, we flag this as an upside risk," BMI says. For now, it lowers India's growth forecasts, seeing growth at 5.8% in FY 2025-2026 and 5.4% in FY 2026-2027. (jason.chau@wsj.com)

0728 GMT - Yields on U.K. government bonds fall, tracking their U.S. counterparts, on expectations that the U.S. Federal Reserve will cut interest rates in September. Investors are pricing in faster interest rate cuts due to President Trump's demands for lower rates and concerns about the Fed's independence, Deutsche Bank Research analysts say in a note. Markets price in an 89% chance of a Fed rate cut in September, LSEG data show. Ten-year gilt yields fall around 3 basis points to last trade at 4.694%, Tradeweb data show. Ten-year Treasury yields decline 2bps to 4.215%. (miriam.mukuru@wsj.com)

0718 GMT - The euro faces further pressure from French political concerns but declines are likely to be limited in the near term, ING analyst Chris Turner says in a note. "We think the dollar trend will dominate here, the euro should find support under $1.1600 into September," he says. French Prime Minister Francois Bayrou is at risk of being ousted after unexpectedly requesting a vote of confidence next month over his government's plans to reduce the budget deficit. The euro reached a three-week low against the dollar on Wednesday as the spread between French and German government bond yields widened. The euro trades flat at $1.1642 after hitting a low of $1.1573 on Wednesday, LSEG data show. (renae.dyer@wsj.com)

0705 GMT - The Bank of Korea could deliver three more rate cuts through 2026, given the dovish signals from a rate-setting meeting earlier in the day, Citigroup economist Jin-Wook Kim writes in a note. The South Korean central bank is "evidently dovish," with one dissenting board member voting for a cut against today's hold decision, and five members still leaving the door open to rate reductions over the next three months, Kim says. He also notes that both the BOK policy statement and the governor confirmed the rate-cut stance will continue. Citi expects the BOK to lower rates in October this year, followed by reductions in May and October next year. (kwanwoo.jun@wsj.com)

0704 GMT - The Philippine central bank is likely to cut its policy rate by 25 bps at least one more time by year-end, says Gareth Leather, a senior Asia economist at Capital Economics in a note. BSP's decision to ease its rate today came as no surprises, he writes. The central bank's relatively dovish tone also suggests that further easing is likely. "The economy could certainly do with more support," he says. While GDP growth held up relatively well in the first half of the year, the economy looks set to slow. Low inflation and falling interest rates will offer some support to demand this year, he says. (amanda.lee@wsj.com)

0654 GMT - The Bank of England is expected to slow down the pace of quantitative tightening to 70 billion pounds over the 12 months starting in October, from 100 billion pounds currently, Pantheon Macroeconomics economists say in a note. Quantitative tightening is a process of unwinding a central bank's bond holdings acquired during periods of quantitative easing. The BOE noted the impact of quantitative tightening on the gilt market during its August policy decision meeting. "This suggests it is becoming increasingly worried about soaring yields," the economists say. Concerns about the effects of quantitative tightening on the gilt market are likely to cause the BOE to reduce this program, they say. (miriam.mukuru@wsj.com)

0646 GMT - The dollar falls as concerns about the Federal Reserve's independence persist following President Trump's dismissal of Fed Governor Lisa Cook. These worries have prompted investors to price in faster interest-rate cuts and higher inflation, Deutsche Bank analysts say in a note. Meanwhile, the WSJ reports that Trump on Wednesday fired Robert Primus, a member of railway regulator the Surface Transportation Board. The move fuels fears that Trump is trying to control independent government agencies. Elsewhere, Treasury Secretary Scott Bessent told Fox Business that a decision on the next Fed Chair should be known in the fall. He also repeated his call for an internal review of the Fed. The DXY dollar index falls 0.1% to 98.119. (renae.dyer@wsj.com)

0641 GMT - France's public finances aren't in a great state but the country isn't likely to resort to a bailout by the International Monetary Fund, economists at Capital Economics say. With the country's minority government facing collapse and the budget deficit still running way over target, French finance minister Eric Lombard warned this week that a recourse to the IMF for financial help was "a risk that is in front of us." But for now, yields on French government bonds aren't spiking, and there are no signs of liquidity problems in the country's sovereign-debt market, Capital Economics says. Even if France were to need financial aid, it would be more likely to turn to options such as the European Stability Mechanism or the European Central Bank, the economists say.(joshua.kirby@wsj.com; @joshualeokirby)

0638 GMT - Rates markets look fully priced for a collapse of French Prime Minister Francois Bayrou's government in the Sept. 8 confidence vote, while spreads could widen further in case of a snap election, Citi Research's strategists say in a note. The 10-year French OAT-German Bund yield spread could widen toward 90-95 basis points in the event of a snap legislative election and 120-125bps if President Emmanuel Macron then also resigns, the strategists say. Macron's resignation is, however, "an unlikely tail risk." Citi holds to its structural short view in 30-year OATs versus Spanish bonds. The 10-year OAT-Bund yield spread narrows about 1.5bps to just below 81bps, according to LSEG. (emese.bartha@wsj.com)

0621 GMT - The U.K.'s public finances aren't in a great state but the country isn't likely to resort to a bailout by the International Monetary Fund, economists at Capital Economics say. A group of senior economists suggested in the British press over the weekend that the country's high debt levels and stinging interest payments could bring about a crash in the economy, with the IMF forced to step in, unless the government acts decisively. But that scenario looks far-fetched, Capital says. The U.K. retains investor confidence despite higher yields on some government bonds, and can finance itself in its own currency, with the Bank of England a secure backstop, the economists say. "There is no evidence of the market pressure that would force external financing assistance," they say.(joshua.kirby@wsj.com; @joshualeokirby)