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Good morning. US-China tension over Taiwan, the duel to become UK premier, scorching heat and some relief for a tight grain market. Here's what people are talking about.

The White House sought to dial back rising tension with China over House Speaker Nancy Pelosi's expected visit to Taiwan on Tuesday, insisting the trip doesn't signal a change in US posture toward the island and urging Beijing to refrain from an aggressive response. There was no reason for Beijing to turn a potential visit consistent with long-standing US policy into some sort of crisis, National Security Council spokesman John Kirby said at a Monday press briefing. Pelosi's trip is putting fresh pressure on markets, sending Asian stocks lower and boosting havens including the yen and Treasuries. European shares are set to open on the back foot.

Liz Truss vowed to slash "waste, bureaucracy and inefficiency" in the civil service to save billions of pounds a year for the British taxpayer if she becomes UK prime minister. The foreign secretary, the front-runner in the race with Rishi Sunak to succeed Boris Johnson, said late Monday that she'll align the pay of public sector workers to living costs in the regions where they live, slash holiday allowances and cut diversity officers in the civil service. The measures — which Truss said would save £11 billion ($13.5 billion) a year — are designed to shore up her support on the right of the ruling Conservative Party on the day ballot papers were sent out to party members.

England had the driest July since 1935 amid a searing heat wave that pushed infrastructure to the brink and severely disrupted travel. The unusually dry weather came as temperatures rose above 40 degrees Celsius for the first time. The intense heat had sparked fires near London, triggered warnings that railway lines could buckle, canceled flights and forced power stations to operate at low levels to prevent overheating. The dry and hot summer that's spreading across all of Europe is also a stark reminder of the unfolding climate crisis.

Ukraine laid out plans to cautiously ramp up grain exports after the first shipment since Russia's invasion was hailed as an encouraging early step toward unblocking millions of tons of crops and easing global food prices. The first two weeks will be treated as a trial period, with no more than three vessels a day in each direction through new safe-passage corridors. If successful, exports could increase to as much as three million tons per month in four to six weeks' time. But while progress is encouraging, there is still a long road ahead before exports get closer to pre-war levels.

Expected data include Spanish unemployment and UK house prices. BP, Direct Line, Fresnillo, Nokian Renkaat and Symrise are all scheduled to report earnings. House Speaker Nancy Pelosi is expected in Taiwan at 10:20 p.m. local time Tuesday, according to a report. Markets are also braced for commentary on the US interest-rate outlook from Chicago Fed President Charles Evans and St. Louis Fed President James Bullard.

This is what's caught our eye over the past 24 hours.

Cost of living assistance for HSBC UK staff.
The star duo that Goldman fired.
Barclays trying to fix a blunder.
Two Russians for two Americans, Moscow says.
Billionaire Cohen exits crypto startup Radkl.
Morgan Stanley, BofA subpoenaed in Twitter- Musk feud.
Credit Suisse's cost of retaining talent.

Russia's invasion of Ukraine has had a surprising impact on the global stock market — pushing European shares inexplicably to the fore. Since the day Russia attacked, European stocks are about the only global region showing a positive return. The Stoxx 600 has seen a total return of about 2%, compared to around minus 5% for the MSCI AC World, minus 3% for the S&P 500, minus 9% for Asia's benchmark and minus 12% for the emerging market stock gauge. That flies in the face of commentary about the impact of the war, that Europe would suffer most, not least because of the increasing likelihood of a Russian energy cutoff. The outlook for growth in the region is incredibly uncertain as energy threats, supply snarls and a burgeoning cost-of-living crisis weigh on output and demand. Concerns about natural gas shortages are mounting, increasing the likelihood of economic and political stress, especially in Germany. When hopes for Europe's economy are dependent on the weather — itself as volatile as markets these days — it's not really a solid foundation for an investment in the region's stocks. Europe's post-war outperformance is unlikely to continue.