Squawk Box Europe Express

Crude prices gain after President Trump rejects an Iranian proposal aimed at ending the Middle East conflict and reopening the Strait of Hormuz. In tech, OpenAI pauses training on its most advanced models after yet another agent escapes from an internet-free environment. And in Liverpool, U.K. Chancellor John Healey is preparing to unveil a "new age of industrialisation" later today when he addresses delegates at the Labour Party Conference.

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President Trump hosts Chinese President Xi Jinping at a state banquet at the White House along with some of America’s top corporate bosses. Talks between the two leaders focused on the A.I. race and the conflict in the Middle East. The global bond rout continues with the U.S. 30-year note rising to its highest level since June 2004 as investors consider the Federal Reserve’s rate path. Crude extended losses on the news of talks progressing between Iran and the US at the United Nations.  

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The 10-year Treasury yield spikes to its highest level since July 2007 in its biggest one day move in nearly 18 months. The 5 and 30 yields are also at levels not seen since before the financial crisis. The U.S. and China extend their trade truce by two months as Chinese President Xi Jinping touches down in America. Another OpenAI agent goes rogue, this time gaining unauthorized access to an Australian government website, with Prime Minister Anthony Albanese raising his concerns directly with Sam Altman. Global debt surges by more than $10 trillion in the first half of the year, surpassing $365 trillion, according to the IIF's latest report. 

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Crude prices retreat after a three-hour meeting between U.S. officials and the Iranian delegation at the UN, even with President Trump saying he needs to make a “big decision” over the next step. China's President Xi Jinping prepares to travel to Washington for talks with Trump, but uncertainty is abound over if the Chinese leader will bring a delegation of corporate leaders with him. AI takes centre stage at the UN today with OpenAI CEO Sam Altman and Anthropic CEO Dario Amodei expected to address the Security Council, as the debate over safety ramps up. France steps up support measures as spiking energy prices weigh on the economy, as we discuss the outlook with the CFOs of the country's two biggest banks.

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The Nasdaq closes at a record high, driven by the AI trade as Meta posts its best day since April 2025. JP Morgan boss Jamie Dimon discusses the technology's potential impact on inflation. Oil gains slightly as U.S. President Trump prepares to meet with Gulf leaders at the UN General Assembly, where Iran's president will lead a delegation today - amid renewed hopes for a diplomatic solution to the conflict. Shares in Novo sink over as the Danish drugmaker lays out its post-Wegovy growth strategy.

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U.S. Treasury Secretary Scott Bessent and the Chinese Vice Premier He Lifeng agree to set up a “U.S.-China AI dialogue” for security incidents from artificial intelligence. This comes in the lead-up to this week’s Trump-Xi summit in Washington. Exit polls spell "disaster" for German Chancellor Friedrich Merz's CDU party after a drubbing in the weekend's state elections. Oil prices hit a one-week low despite weekend attacks by Houthi rebels on Riyadh, as markets hope diplomacy prevails when leaders meet on the sidelines of this week’s UN General Assembly.

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The bank of Japan delivers a quarter point hike, taking rates to the highest level since 1995. But two dissenting votes raise doubts around further normalization, driving the Yen and JGB yields lower. The Bank of England stands pat but warns rates will likely go up, with Governor Andrew Bailey flagging energy costs as a key threat. The S&P 500 sees its best day since early August as crude prices and treasury yields pull back, with tech stocks driving the charge on Wall Street. Researchers reportedly hack into OpenAI using Anthropic tools, as King Charles convenes AI leaders in Scotland to stress the importance of safety. Palantir CEO Alex Karp tells CNBC the technology must have “reasonable guidelines”.

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The Fed hikes for the first time in over 3 years, with the Dow shedding over 600 points while the 10-year Treasury yield holds stubbornly around the 5% mark. The rate hike provokes U.S. President Donald Trump, who once again demands looser monetary policy, calling the FOMC “hostile”. Across the pond the Bank of England looks poised to deliver a hold as long-term borrowing costs hover near their highest in nearly 30 years. And the EU's offer for Canada to become its first-ever associate member also draws the ire of President Trump, who threatens further trade restrictions on the bloc if those plans progress.

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All eyes are on the Federal Reserve decision today, as America’s central bank is all-but certain to have its first hike in over 3 years with the expected move will likely strain ties with U.S. President Donald Trump. Meta’s Mark Zuckaberg is weighing in on the AI safety debate, favoring independent evaluation rather than a slowdown in development, but Nvidia’s Jensen Huang and OpenAI CFO Sarah Friar come down on opposite sides of the conversation. 

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Chip names sell off on both sides of the pond amid investor pullback after warnings from AI giants. Software stocks, however, catch a bid, putting the two baskets at a huge divergence. Trump intervenes, calling warnings over the technology a “sick” “hoax,” and telling AI leaders not to kill the “golden goose”, going as far as calling up Jensen Huang during a podcast recording. The 10-year Treasury yield hits its highest ever level in almost 20 years, with traders eyeing a near 95% chance of a Fed hike as the FOMC starts its two-day meeting today.

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