(The opinions expressed here are those of the author)

By Anna Szymanski

What matters in U.S. and global markets today

By Anna Szymanski, Editor-in-Charge, Reuters Open Interest

Wall Street looks set for a weak opening ahead of the bell

on Thursday. Federal Reserve Chair Jerome Powell's warning about

stretched valuations has perhaps injected a bit of caution into

markets, given the run-up in equities this year. Fed watchers

will be busy today, with multiple officials from the central

bank set to speak. Investors will also soon get a bit more color

about the factors weighing on both sides of the Fed's mandate,

with the final estimate of U.S. second-quarter GDP coming out

today, followed by the latest PCE inflation index reading

tomorrow.

* Powell's remarks on asset valuations and the Fed's

"tightrope"

policy stance have led investors to pare back expectations for

aggressive easing. San Francisco Fed President Mary Daly echoed

the need for further cuts but stressed that the timing remains

uncertain. Markets are now pricing in a more than 90% chance of

an October cut, but expectations for further easing through

year-end have fallen to 100 basis points, down from earlier

projections of 125 bps total easing. In other central bank news,

the Swiss National Bank announced on Thursday that it was

keeping its key policy rate unchanged at zero, its first pause

since late 2023. The SNB noted that the Trump administration's

tariffs had dimmed the economic outlook.

* Over in Asia, stocks were subdued on Thursday, while the

yen

came under selling pressure, particularly against the euro and

Swiss franc. MSCI's broadest index of Asia-Pacific shares

outside Japan fell slightly, having rallied over 5% for the

month and 9% for the quarter. Japan's Nikkei rose modestly,

after rising 7% for the month and 13% for the quarter. Chinese

shares continued to outperform, with Chinese tech shares up for

a record eighth consecutive week.

* Finally, crude prices slipped early after spiking 2%

overnight,

hitting a seven-week high, amid news of a surprise drop in U.S.

inventories and ongoing concerns about the impact Ukraine's

strikes on Russia's energy infrastructure could have on supply.

Today's Market Minute

* The White House asked federal agencies on Wednesday to prepare

plans for mass firings during a possible government shutdown

next week, marking a sharp departure from the temporary

furloughs of workers typically seen during past shutdowns.

* Chinese drone experts have flown to Russia to conduct

technical development work on military drones at a state-owned

weapons manufacturer that is under Western sanctions, according

to two European security officials and documents seen by

Reuters.

* Several investors in Walt Disney on Wednesday asked the media

giant to share documents about its decision to suspend Jimmy

Kimmel's show last week for inspection.

* Which countries make up the "Dirty Dozen," the nations likely

to play a key role in determining future pollution trends? Find

out in the latest piece from ROI global energy transition

columnist Gavin Maguire.

* Debate around the politicization of the Federal Reserve has

mostly centered around its ability to set interest rates. But,

writes ROI markets columnist Jamie McGeever, another part of the

central bank's toolkit is also back in the spotlight, one that

could perhaps have even greater significance for global

financial stability.

Chart of the day

Oil prices moved down early on Thursday from the previous

session's seven-week high, with investors likely taking profits

in anticipation of slower winter demand and the return of more

supplies from Iraq and Kurdistan. Oil flows from Iraqi Kurdistan

are expected to restart in days after eight oil firms struck a

deal on Wednesday with Iraq's federal and Kurdish regional

governments to resume exports. Meanwhile, the threat of a

revival of international sanctions on Iran is looming, but ROI

energy columnist Ron Bousso argues that these measures are

unlikely to curtail Tehran's vital oil exports but could benefit

Chinese refiners, offering them access to a larger share of

discounted Iranian crude.

Today's events to watch

* U.S. 2Q GDP final estimate (8:30 AM EDT)

* U.S. August Durable Goods Orders (8:30 AM EDT)

* Fed Vice Chair for Supervision Michelle Bowman speaks

(9:00 AM

EDT)

* Fed Governor Michael Barr speaks (1:00 PM EDT)

* Treasury auction $44 billion 7-year notes

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Opinions expressed are those of the author. They do not reflect

the views of Reuters News, which, under the Trust Principles, is

committed to integrity, independence, and freedom from bias.

(By Anna Szymanski; Editing by)