The Danske Analysts note that markets will watch out for further trade war escalation and 'tit-for-tat' headlines, among the first-tier macro news from Germany and the US.

“In Europe focus is on the German Ifo index for August. Last week's PMI figures finally signalled some stabilization, but the ZEW survey gave a different signal. We think the battered German economy is not yet out of the woods and hence look for a further deterioration in today's Ifo expectations and current situation assessment on the back of ongoing geopolitical uncertainties. In the US, preliminary capex orders in July are due, which will be interesting in the light of the ongoing manufacturing slowdown and trade war uncertainty. It seems that many companies are reluctant to invest in the current environment.”