07:59 AM EDT, 08/26/2025 (MT Newswires) -- Risk-off sentiment is marked by slight weakness in North America equity futures and slightly larger declines in European cash markets following losses across most Asian exchanges, said Scotiabank.

Catalysts may include United States President Donald Trump's additional tariff threats related to countries with digital service taxes late Monday after escalating pharma tariff warnings and furniture tariff threats, Trump's move to fire Federal Reserve Governor Lisa Cook, and perhaps market concerns about the French government's viability in a confidence vote on budget measures, noted the bank.

The CAC40 is falling by 1.5% early Tuesday and French 10s are once again underperforming German Bunds, pointed out Scotiabank.

Gilts are underperforming sovereign bond rallies elsewhere as uncertainty rises over potential measures to rein in fiscal imbalances in the United Kingdom ahead of Finance Minister Rachel Reeves' fall budget, likely by late October.

The US dollar (USD) is depreciating against most of the majors, added the bank.

An otherwise light overnight session for calendar-based risk is giving way to several U.S. releases, a speech by Bank of Canada Governor Tiff Macklem and the start of the Q3 Canadian bank earnings season, accoridng to Scotiabank.