A look at the day ahead in European and global markets from

Wayne Cole.

It's been a quiet start to the week, what with Japan on

holiday and President Trump busy playing golf. Notably Nikkei

futures traded in Chicago are just a whisker from

all-time highs, suggesting the cash index could well reach it

this week.

The Nikkei still only has a PE of 19, compared with 22 for

the S&P 500 and almost 33 for Nasdaq, which is essentially a

premium for AI. It would seem to be negative news, then, that

Nvidia ( NVDA ) and AMD have agreed to give the U.S.

government 15% of revenue from sales to China of AI chips in

return for export licenses.

That would be an extraordinarily unusual deal, especially as

the U.S. had initially blocked the sales for national security

reasons. Is this a tax? A fee? Where will the money go? How

would it be administered? So many unknowns.

For the dollar and bonds, the main economic event will be

U.S. consumer prices on Tuesday, where the impact of tariffs

could nudge the core up 0.3% to an annual pace of 3.0% and

further away from the Federal Reserve's target of 2%.

Forecasts range from 2.9% to 3.2%, suggesting some upside

risk, which would test market wagers for a September rate cut.

Analysts assume it would have to be a real shocker to move the

dial much given the recent downward lurch in payrolls is now

dominating the policy outlook.

Also on Tuesday is the supposed deadline for a U.S. trade

deal with China. While everyone assumes it will be extended,

there's yet to be any word on it for either side.

Chaos appears to be more a feature than a bug. Take COMEX

gold futures, which surged last week after U.S. customs

indicated the most widely traded bullion bars - produced mainly

by Switzerland - would be slapped with tariffs.

The White House assured the market on Friday that this was

"misinformation" and would be clarified, but again no more has

been heard. Copper markets went through similar tariff-induced

convulsions the week before.

Last week, Japan's trade team had to hotfoot it to

Washington to correct the double-taxation of its exports. Japan

assumes that was fixed, but there's still nothing in writing.

Now, oil prices have slipped just in case the talks between

Trump and Russian leader Putin due this Friday actually make

progress on Ukraine. Progress seems unlikely, however, given the

White House has been floating the idea of a land swap which

Ukraine would never agree to.

There are also reports from Europe that Trump envoy Steve

Witkoff misunderstood what Putin was proposing at a meeting last

week, suggesting some risk the entire Alaska adventure might be

called off ahead of time.

Key developments that could influence markets on Monday:

- No major data due

(Editing by Sam Holmes)