Bottom-Fishing
August 21, 2026
After Thursday’s difficult session for equities, Friday has seen a bounce. Stock markets closed up 1.2% in Hong Kong, 0.9% in India, and 0.7% in Taiwan and Indonesia. European bourses show gains but of less than 1.0%, and the DOW, SPX and Nasdaq just opened slightly higher.
Today’s biggest winner has been crypto. Bitcoin’s price is up over 4% on the day and a bit more than 20% from a week ago. Silver (+2%) and gold (+1.3%) have been well bid as well today.
The dollar is broadly lower today, with sharpest overnight drops at the moment of 0.8% against the Australian dollar, 0.7% versus the kiwi and Indonesian rupiah, and 0.6% relative to the South Korean won. The euro touched a 14-week high of $1.1711 earlier today but is currently just 0.1% higher.
The 10- and 30-year U.S. Treasury yields are each a basis point higher at 4.71% and 5.26%, not the levels nor direction that Secretary Bessent is seeking. Ten-year sovereign debt yields in Germany, France, Italy and Spain are a basis point lower. Much bigger moves, all upward, have been experienced in 10-yields of New Zealand (6 bps), Australia (5 bps) and Japan (4 basis points).
August flash composite purchasing manager indices exceeded expectations in the United States (a 52-month high of 56.0), Japan (a 6-month high of 53.4), Australia (a 2-month low of 52.5), Euroland (a 9-month high of 52.1 and suggesting 3Q GDP growth of 0.3% not annualized), India (a 2-month high of 54.6) and Great Britain (a 4-month high of 52.5). Each of these diffusion indices exceeded the 50 level that separates improving from worsening economic conditions. In the bulk of this cases, services rather than manufacturing provided the main impetus for the improvement. Within the euro area, however, the composite German PMI score (a 2-month low of 51.0 versus 51.3 in July) and France (also a 2-month low of 48.8 after 49.6) saw a somewhat lower pace of positive growth this month according to these preliminary findings.
U.S. Treasury Secretary Bessent plans to unveil a set of new stringent economic sanctions on Monday directed against Iran. The intent of these measures is to restore normal shipping traffic through the Strait of Hormuz. Today’s level of traffic has been very spotty, and the price of West Texas Intermediate crude oil is currently quoted at $86.40, 0.5% lower on the day but about 15% above August’s low.
Japanese core consumer price inflation (excluding food but including energy) rose in July to a six-month high of 1.8%. Speculation has risen that the Bank of Japan’s interest rate may be raised next month.
Producer price data were released in a number of countries today. Irish wholesale price inflation more than doubled to a 45-month high of 7.3% in July. South Korean producer price inflation retreated to a 3-month low of 7.7% last month. Latvian PPI inflation of 3.5% was at a 17-month high, while Estonian PPI inflation (also 3.5% in July) was at a 2-month low.
French business confidence showed further improvement in August. That index of 98.1 moved close to the long-term average of 100. It was the best reading in a half year and 4.2 points above May’s level. Employment held steady with a 4-month high reading of 99.5.
August consumer confidence readings reported today included a 5-month high in the Netherlands but still deeply negative at -34; a 2-month low in Belgium of -7; a 6-month high in Denmark of -13.1; a 3-month Slovenian low of -22; a 24-month high in the U.K. of -14; and a 39-month high in Turkey of 90.8 (still well below the measure’s 100 line of divide between outright optimism and pessimism.
Indonesia experienced a record wide current account deficit last quarter of $12.5 billion versus a $2.9 billion shortfall in all of 2025.
Canadian retail sales suffered their biggest monthly drop (-0.8%) in ten months during July. That same month saw British retail sales volume decline 0.5% and post their smallest year-on-year rise (1.6%) in three months.
Copyright 2026, Larry Greenberg. All rights reserved.
Tags: August preliminary purchasing manager surveys, French business confidence, Japanese consumer prices
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