What moved
Asia has borne the brunt. The KOSPI is trading 3.29% lower at 6,682.39, the sharpest move on the board, while the Nikkei 225 is down 0.73% at 63,542.25. Mainland China has been steadier — the Shanghai Composite is off 0.14% at 3,882.77 — and the Hang Seng is the one green light, up 0.37% at 24,897.84.
That sits awkwardly against Friday's US close, where the S&P 500 ended 0.86% higher at 7,656.98, the Nasdaq Composite gained 0.96% to 26,333.04 and the Dow rose 0.98% to 52,573.29. US cash is shut; futures are the live read and they are pointing the other way, with S&P contracts down 0.47% and Nasdaq 100 contracts down 1.22%. Europe closed Friday on the front foot — the FTSE 100 up 0.39% at 10,650.44, the DAX up 0.82%, the CAC 40 up 0.78% — and opens into a weaker tape.
Why
The energy shock is doing the work. Saudi Arabia shut its East–West pipeline late last week after drone attacks damaged the line, removing the kingdom's only major export route that avoids the Strait of Hormuz at a moment when Hormuz traffic is already throttled by the US–Iran conflict; Houthi forces have also tightened their position near the Bab el-Mandeb chokepoint. Brent is 2.0% higher at $106.70 and WTI 2.05% higher at $102.10, extending five-day gains of roughly 9% and 10%.
The transmission into equities runs through the Federal Reserve. Friday's US inflation print showed core prices rising 0.3% on the month against a 0.2% consensus, with headline at 0.4%, and the market's implied odds of a hike at Wednesday's meeting moved to around 90%. A central bank tightening into an energy shock is the opposite of the backdrop that carried the AI complex this year, which is why the damage is concentrated in the most expensive growth markets: Korea, where SK hynix fell more than 5%, and Nasdaq futures.
The KOSPI's position explains the violence of the move. It is still up 55.06% year-to-date but now trades 28.8% below its 52-week high — a crowded, heavily-owned memory and AI trade unwinding rather than a change in the economic data.
Sentiment & risk appetite
The defensive signals are in rates and breadth rather than in equity volatility. The US 10-year yield closed Friday at 4.975%, up 3.1 basis points, with the 5-year up 5.8 basis points at 4.791% and three-month bills up 6.8 basis points — a front-end-led move, which is what pricing a hike looks like. The MOVE index of rates volatility is 7.97% higher over five sessions while the VIX closed Friday at 15.84, so the anxiety is in bonds, not stocks. Gold is barely moved at $4,371.90, up 0.13%, and is not acting as the haven here; the dollar is, with the index up 0.33% and the euro down 0.45% at 1.1558. Breadth tells the regional story bluntly: across PrimerIQ's Asian universe decliners beat advancers by more than three to one on Friday, with a mean move of -1.7%, against a US advance-decline ratio of 1.28 and a median technology gain of 1.44%.
Economic calendar
There is no UK data today — the ONS calendar is empty until tomorrow — and the only scheduled release of note is Canadian CPI at 13:30 BST (12:30 GMT). That leaves the tape to run on oil and positioning.
The number still setting the agenda is Friday's US CPI, where core came in at 0.3% month-on-month against 0.2% expected, the firmest since April. The week's calendar then arrives in a rush: Chinese industrial production and retail sales at 03:00 BST tomorrow, UK labour market data at 07:00 BST tomorrow, UK CPI at 07:00 BST on Wednesday, the Fed decision at 19:00 BST on Wednesday, the Bank of England at 12:00 BST on Thursday and the Bank of Japan on Friday.
Earnings
Nothing of consequence has reported this morning; the UK 07:00 slate is bare. The results still driving prices are Friday's read-across from Oracle's reiterated capital-expenditure guidance of $90bn-$95bn, which sent Dell up 11.98% to $567.29 and Hewlett Packard Enterprise up 12.44% to $62.09 as the named beneficiaries of AI rack and networking spend. Whether that holds is the open question, given Nasdaq futures are now the weakest thing on the screen.