Middle East braces for possible Iran attack on Israel

Good morning. Here's what happened overnight and what you need to know today.

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1.

On standby: The US commander in charge of the Middle East, General Michael Kurilla, arrived in the region on a pre-arranged visit to mobilise coalition forces amid a possible attack on Israel by Iran as early as Monday. Axios reported, citing sources, that US and Israeli officials were expecting an imminent attack from Iran and Hezbollah in retaliation for the assassinations of top Hezbollah and Hamas leaders, which could come on Monday. The Pentagon sent additional warships and fighter jets to the Middle East, as the US, UK, Australia and Canada, urged their citizens to leave Lebanon following Iran's warnings of severe retaliation against Israel for the assassination of Hamas leader Ismail Haniyeh and the Hezbollah commander Fuad Shukr. Iran told Arab diplomats it didn’t care if the response triggered a war, The Wall Street Journal reported citing sources. Meanwhile, deadly Israeli strikes continued in Gaza amid stalled ceasefire deal talks, and a Palestinian man killed two people in a stabbing in central Israel on Sunday. Jordan’s foreign minister Ayman Safadi visited Iran in an effort to prevent further escalation - the first such visit in two decades. (Axios)(BBC)(Reuters)

2.

Buffett’s cash: Warren Buffett’s Berkshire Hathaway revealed on Saturday it sold nearly half of its stake in Apple during the second quarter, cutting it by over USD50 billion ($76.68 billion) to $84.2 billion, according to filings. The move, along with sales of USD3.8 billion worth of Bank of America shares, pushed Berkshire’s cash holdings to a record USD277 billion. Proceeds from the USD76 billion stock sell-down, which generated an after-tax gain of USD47.2 billion for the group, were invested in short-term Treasuries, reflecting a strategic shift amid a cooling economy. Berkshire’s net income for Q2 was USD30.3 billion, down from USD35.9 billion a year earlier, while operating earnings rose to USD11.6 billion. (The Financial Times)(The Wall Street Journal)

3.

Veep pick: Vice President Kamala Harris is interviewing top vice-presidential candidates on Sunday, including Senator Mark Kelly of Arizona, and Governors Tim Walz of Minnesota and Josh Shapiro of Pennsylvania, the New York Times reported. The in-person meetings, were being held at her residence in Washington, and are part of the final stages of Harris’ process to find a suitable running mate. The campaign plans to announce the vice-presidential pick before a tour of battleground states begins on Tuesday. Meanwhile, an explosive report by The Daily Mail claimed Doug Emhoff, Harris's husband, had an extramarital affair with a nanny during his first marriage, which resulted in a pregnancy. After the report, Emhoff admitted to having the affair when he was married to film producer Kerstin Emhoff about 15 years ago. The couple divorced in 2009, before Emhoff met Harris in 2013. (The New York Times)

4.

Fed fears: Bond traders have upped bets the US economy is slowing so rapidly that the Federal Reserve will have to cut interest rates more aggressively than previously expected to prevent a recession. The bets follow jobs data last week putting inflation concerns in the back seat to give way to fears of economic stagnation. Last week’s data, showing only 114,000 jobs were added in July and a rise in the unemployment rate led to a half percentage point in the two year Treasury yield to below 3.9%, a level not seen since the global financial crisis. Economists are now predicting the Fed could double planned rate cuts in upcoming meetings, with Citigroup and JPMorgan forecasting a half-percentage-point reductions in September and November. The new fears have led to a bond market rally, pushing the 10-year yield to around 3.8%, its lowest since December. (Bloomberg)

5.

Trump's moves: Donald Trump has withdrawn from a scheduled ABC News debate on 10 September against his presumptive opponent Kamala Harris. Posting on Truth Social, Trump instead proposed a debate on Fox News six days earlier, with an audience and in Pennsylvania, a move the Harris campaign criticised as an attempt to avoid the agreed-upon debate, accusing Trump of running scared. Trump had agreed to the televised encounter in May, before President Joe Biden’s disastrous performance on 27 June and his ensuing withdrawal from the 2024 presidential race. Campaign officials for Vice President Kamala Harris said she was open to discussing further debates if Trump honoured his commitment to the ABC debate. Later, Trump used a rally in the swing state of Georgia to attack Harris, and Republican governor Brian Kemp, alleging Kempt and Secretary of State Brad Raffensperger were obstructing his campaign efforts. "Ninety-four days from now, we're going to win the state of Georgia," Trump told the crowd. "We're going to evict this radical and incompetent administration." (The New York Times)(Axios)

6.

UK riots: Violent anti-immigration protests erupted across England over the weekend, with demonstrators breaking hotel windows and dozens arrested in clashes with police. A far-right protest in South Yorkshire sparked by the killing of three girls at a Taylor Swift-themed dance workshop, turned chaotic when masked demonstrators stormed a hotel, wrongly believing it housed asylum seekers. The protest escalated as the crowd threw debris and bottles at officers, set a bin on fire and broke into the hotel. Riots erupted in Rotherham Sunday afternoon, following over 147 arrested on Saturday in cities including Aldershot, Bristol, Blackpool, Hull, Liverpool and Manchester according to reports by Reuters, CNN and The Financial Times. The protests, fuelled by Islamophobic and anti-immigrant misinformation alleging the 17-year-old suspect of the killings was an immigrant despite officials confirming he was British, are the UK's most significant far-right ructions since 2011. New Prime Minister, Sir Keir Starmer, a former chief prosecutor, condemned the violence warning those involved will face the full force of the law. (Financial Times)(Reuters)(CNN)

7.

Deadly protests: At least 91 people died and hundreds more were injured in Bangladesh amid escalating clashes between security forces and protesters denouncing Prime Minister Sheikh Hasina's autocratic rule and economic mismanagement. The fast-growing death toll on Sunday was a recent history record, as violence has intensified across the country since protests began in July. The violence, which claimed the lives of at least 13 police officers, followed a government crackdown last month that left over 200 dead. The unrest is fuelled by tens of thousands of students and other demonstrators calling for Hasina’s resignation. In response, Hasina imposed an indefinite nationwide curfew starting Sunday, a three-day general holiday and shut down internet services, while calling the protesters "terrorists." The army’s involvement was mixed, with reports of both suppression and protection of protesters. (Reuters)

8.

Ukrainian upgrade: Ukrainian President Volodymyr Zelenskiy said the country’s air force had started deploying US-made F-16 fighter jets, more than 29 months after Russia's invasion. The Lockheed Martin-made jets, are a major upgrade from Ukraine's ageing Soviet-era aircraft, which the Kremlin has vowed to shoot down. Zelenskiy announced the arrival at an undisclosed air base on Sunday flanked by two of the planes. Earlier, the country’s military claimed responsibility for sinking the Russian submarine Rostov-on-Don while it was docked at Sevastopol port in Crimea. According to the Ukrainian defence ministry, the Kilo-class submarine, worth some USD300 million, was struck by a missile and subsequently sank. It was one of four in Russia's Black Sea fleet capable of launching Kalibr missiles. The officials said four S-400 air defence systems were also destroyed during the attack. The submarine had been damaged in a September 2023 strike but had recently been repaired, the BBC and CNN reported. (Reuters)(CNN)