Market Overview

Investors pushed European equities higher on Tuesday, with the pan‑European Stoxx Europe 600 Index gaining 0.4% after a multi‑week slump. The UK FTSE 100 added 0.09%, France’s CAC 40 rose 0.16%, and Germany’s DAX climbed 0.25%. Energy prices retreated, with Brent crude futures trading little changed around $91.50 a barrel after a 2% overnight fall, easing concerns about cost‑push inflation in European supply chains.

German Economic Data

Germany’s second‑quarter gross domestic product expanded 1.0% year‑on‑year, surpassing the 0.9% consensus and up from 0.7% in Q1. On a quarter‑on‑quarter basis, GDP grew 0.3%, beating the 0.2% preliminary estimate. The growth was underpinned by a 2.0% rise in exports, led by chemicals, electronics and transport equipment shipments, providing a fundamental tailwind for northern‑European equities despite higher borrowing costs and soft domestic demand.

US Treasury Cash‑Account Plan and Yield Impact

Reports indicated the U.S. Treasury Department may draw on its Treasury General Account (TGA) cash balance to fund an expanded debt‑buyback programme, opting to use existing cash rather than issuing new short‑term bills. This approach is expected to reduce the net supply of Treasury securities, prompting a pull‑back in sovereign‑debt yields. Consequently, Germany’s 10‑year Bund yield eased back toward 3.23%, giving equity markets additional breathing room ahead of the high‑profile earnings release from Nvidia Corp. and Federal Reserve Chair Kevin Warsh’s scheduled speech at the Jackson Hole symposium.

Equity Movers

Chesnara shares jumped nearly 5% after reporting strong capital generation, while homebuilder Vistry surged 10% following the announcement of a £350 million funding programme for social and affordable housing.

Outlook

The market rebound reflects the dissipation of immediate geopolitical risk after the U.S. administration’s “economic D‑Day” rhetoric against Iran failed to materialise into new secondary sanctions or supply disruptions. With energy prices stabilising, German export momentum, and a modest easing of European sovereign yields, risk assets appear to have regained footing as investors await upcoming corporate earnings and central‑bank commentary.