06:19 AM EDT, 09/30/2024 (MT Newswires) -- Commerzbank in its "Euroepan Sunrise" note of Monday highlighted:

Markets: United States Treasuries closed near the highs, turn rangebound in Asia. Japanese government bonds weaken, yen drops, Nikkei tumbles almost 5% after prime minister election. China stocks surge more than 6%, e-minis are mixed. EUR and oil trend sideways.

Fed: St. Louis Federal Reserve Bank President Alberto Musalem says the Fed should cut rates "gradually," but may cut faster if the labor market weakens more than expected (FT). Federal Reserve Governor Michelle Bowman says data shows that the economy and labor market remain strong.

US: New York Fed GDP Nowcast is little changed at 2.99% for Q3, and ticks slightly up to 2.8% for Q4.

Middle East: Israel killed Hezbollah leader Sayyed Hassan Nasrallah in an air strike on Beirut and widened strikes against Houthi rebels in Yemen. The US and Israel are working on defense against a potential Iran attack (CNN).

== EUROPE:

France: Government weighs new taxes on large firms (Le Monde).

Italy: Public debt/GDP should rise to 137.8% in 2026 from 135.8% this year, and will only start falling from 2027 according to the new multi-year fiscal plan.

Austria: Right-wing FP wins federal elections with 29.2%, but second and third-placed conservative OVP (26.5%) and socialist SPO (21%) are likely to form the government. Liberals reached 9%, Greens 8%.

Ratings: Scope affirms Germany at AAA/stable. S&P affirms Baden-Wuerttemberg at AA+/positive. Moody's downgrades Israel by two notches to Baa1/negative on mounting costs of war.

== ASIA:

China: Manufacturing PMI rises more than expected by 0.7pt to 49.8, while service PMI surprisingly declines by 0.3pp to 50. Caixin PMIs disappoint. The central bank says banks should cut existing mortgage rates by no less than 30bps below the Loan Prime Rate in October. Major cities ease homebuying rules.