InvestMacro

By the end of Wednesday, the Dow Jones Index (US30) declined by 0.38%. The S&P 500 Index (US500) fell by 0.12%, while the tech-heavy Nasdaq Index (US100) closed higher by 0.15%. The US stocks ended mostly lower on Wednesday after the Federal Reserve kept interest rates unchanged at its July meeting, as investors digested a wave of earnings reports. Fed Chair Jerome Powell noted that the Fed is still assessing the impact of Trump-era tariffs on inflation, which tempered expectations for near-term rate cuts. The decision was not unanimous: Fed governors Michelle Bowman and Christopher Waller supported a 25-basis-point rate cut.

Investors also evaluated corporate earnings: Humana, Kraft Heinz, and Visa gained on strong results, while Starbucks dropped over 1% despite higher revenue. Meanwhile, trade tensions escalated as President Trump announced 25% tariffs on Indian goods and 50% tariffs on Brazilian imports.

The Canadian dollar fell to 1.38 per US dollar, its weakest level in two months, pressured by a stronger US dollar, while Canada’s monetary and economic environment had little impact on the Loonie. The Bank of Canada’s decision to keep its key rate at 2.75%, the third pause after seven cuts. This highlighted policymakers’ caution amid ongoing tariff uncertainty, an expected GDP slowdown in Q2 (after exporters front-loaded shipments in Q1), and projections that CPI inflation will remain close to the 2% target in the medium term.

European stock markets were mostly up yesterday. Germany’s DAX (DE40) gained 0.19%, France’s CAC 40 (FR40) closed up by 0.06%, Spain’s IBEX35 (ES35) added 0.23%, and the UK’s FTSE 100 (UK100) ended slightly higher by 0.01%. Investors evaluated a range of regional economic data and fresh corporate earnings while keeping an eye on trade talks. Germany’s economy contracted by 0.1% in Q2, reversing a 0.4% growth in Q1. Meanwhile, the German cabinet approved a draft 2026 budget featuring a record €126.7 billion in investments and €174 billion in planned borrowing.

On the corporate front, Siemens Healthineers rose around 2% on strong Q3 results and updated expectations, and Porsche AG gained 1.7% as investors welcomed its strategic restructuring despite a projection cut due to €400 million in tariff-related losses. Among decliners, Adidas plunged over 11% after missing revenue targets, and Mercedes-Benz dropped 3.4% after H1 profit halved and its full-year revenue outlook was lowered.

WTI crude oil prices climbed above $70 per barrel on Wednesday, holding at a five-week high, driven by concerns over supply after President Donald Trump pressured Russia to shorten the timeline for ending the war in Ukraine. Trump gave Moscow a 10-day ultimatum to propose a satisfactory resolution or face consequences, including 100% secondary tariffs on countries continuing trade with Russia. These measures could significantly disrupt oil markets, as key US trading partners, major buyers of Russian oil, might reduce or halt purchases.

Asian markets traded mixed yesterday. Japan’s Nikkei 225 (JP225) declined by 0.05%, China’s FTSE China A50 (CHA50) rose by 0.17%, Hong Kong’s Hang Seng (HK50) dropped by 1.36%, and Australia’s ASX 200 (AU200) ended the day with a gain of 0.60%.

Official PMI data from China indicated a slowdown in July, with the composite PMI falling to a three-month low of 50.2 from June’s 50.7. Manufacturing activity remained in contraction, slipping to 49.3 from 49.7, while the services PMI declined to 50.1 — the weakest in eight months — from 50.5. Despite weak data, sentiment found some support from Wednesday’s Politburo meeting.

At its July meeting, the Bank of Japan left its short-term policy rate unchanged at 0.5%, maintaining borrowing costs at their highest level since 2008, in line with market expectations. The decision was unanimous, reflecting the Central Bank’s cautious stance on policy normalization. In its quarterly outlook, the BoJ raised its core inflation expectations for fiscal year 2025 to 2.7%, up from April’s 2.2%, while expecting it to drop to 1.8% in FY2026 and rise again to 2.0% in FY2027. The GDP growth estimate for FY2025 was slightly raised to 0.6% from 0.5%, while the FY2026 growth projection remained unchanged at 0.7%.

As of Tuesday, the Dow Jones Index (US30) fell by 0.46%. The S&P 500 Index (US500) declined by 0.30%, and the tech-heavy Nasdaq Index (US100) closed lower by 0.21%. The three major US indexes ended Tuesday in the red as mixed corporate earnings reports and caution ahead of the Federal Reserve’s monetary policy decision weighed on investor sentiment. Weak results from UnitedHealth (-7.5%), Boeing (-4.4%), and Merck (-1.7%) dragged the market down, while United Parcel Service and Whirlpool also slumped more than 10% following disappointing earnings and expectations. Investors also reacted to a decline in job openings and hiring in June, although consumer confidence in July came in higher than expected. Meanwhile, trade talks between the US and China ended without a final agreement, leaving hopes alive for an extension of the current tariff truce.

The Fed is expected to leave interest rates unchanged today, but markets are closely watching for signals on the future direction of policy amid signs of slowing inflation.

The Bank of Canada will also hold its policy meeting today. It is expected to keep interest rates unchanged at 2.75%, but the tone of the statement and the follow-up press conference will be key for markets. Recent data points to economic weakness: GDP is expected to contract for the third consecutive month, increasing the likelihood of a rate cut by year-end. With slowing inflation and weakening domestic demand, the Bank of Canada may lean toward a more dovish outlook.

The IMF expects global economic growth at 3.0% in 2025 and 3.1% in 2026, slightly above its April 2025 projections. The upgrade — by 0.2 percentage points for 2025 and 0.1 percentage points for 2026 — reflects stronger-than-expected economic activity, lower-than-expected US tariff rates, improved financial conditions (partly due to a weaker US dollar), and expanded fiscal policies in several major economies. Despite the slightly improved outlook, the IMF warns that risks remain tilted to the downside. Growth projections for key economies include the US at 1.9% in 2025 and 2.0% in 2026, the Eurozone at 1.0% and 1.2%, and the UK at 1.2% and 1.4%. China’s growth was revised upward to 4.8% and 4.2%, while Japan is expected to grow at a more modest pace of 0.7% and 0.5%.

European stock markets mostly rose yesterday. Germany’s DAX (DE40) gained 1.03%, France’s CAC 40 (FR40) closed up 0.72%, Spain’s IBEX35 (ES35) rose by 0.90%, and the UK’s FTSE 100 (UK100) ended up 0.60%. The FTSE 100 climbed over 0.5% to a new record high, supported by strong corporate earnings and improved sentiment around the UK economy. Shares of AstraZeneca jumped 3.5% following strong Q2 results, driven by high cancer drug sales and reaffirmed guidance. Barclays also rose by 2.5% despite a mixed earnings report, as its investment banking division posted solid results, benefiting from market volatility. Optimism was further boosted by the IMF’s projection that the UK’s economic growth this year and next will outpace other major European economies.

WTI crude oil prices rose by 3.7% to close at $69.20 per barrel on Tuesday, reaching a five-week high and extending Monday’s 2.4% gain, as easing trade tensions and rising geopolitical risks fueled supply concerns. Additional support came from former President Trump, who increased pressure on Russia by setting a shorter deadline for progress in ending the war in Ukraine and threatening new sanctions.

Asian markets traded mixed yesterday. Japan’s Nikkei 225 (JP225) fell by 0.79%, China’s FTSE China A50 (CHA50) rose by 0.01%, Hong Kong’s Hang Seng Index (HK50) declined by 0.15%, while Australia’s ASX 200 (AU200) posted a modest gain of 0.08%.

The Australian dollar rose above the $0.651 level on Wednesday, snapping a four-day losing streak, as a weaker US dollar outweighed weak domestic inflation data. In Australia, consumer prices rose at the slowest pace in over four years in Q2: the headline CPI was 0.7% quarter-over-quarter and 2.1% year-over-year, while core inflation fell to a three-year low of 2.7% year-over-year. Both figures came in below expectations and within the Reserve Bank of Australia’s 2–3% target range. The soft inflation data strengthened expectations for policy easing, with markets now fully pricing in a 25-basis-point rate cut at the RBA’s August meeting.

On Monday, the Dow Jones Index (US30) fell by 0.14%. The S&P 500 Index (US500) edged up by 0.02%. The tech-heavy Nasdaq (US100) closed higher by 0.36%. The US stocks were mostly flat as investors digested the new trade agreement between the US and the EU and prepared for a busy week filled with earnings reports and key economic data.

President Trump announced a tariff agreement with the EU, setting a baseline rate of 15% (lower than the previously threatened 30%) amid growing hopes for an extension of the US-China trade truce. Despite easing trade tensions, market sentiment remained cautious due to ongoing uncertainty about the broader economic impact of tariffs. Attention is now shifting to earnings reports from Meta, Microsoft, Apple, and Amazon, as well as the Federal Reserve meeting on Wednesday, where investors will closely watch for any hints of a potential rate cut in September.

European stock markets mostly declined yesterday. Germany’s DAX (DE40) dropped by 1.02%, France’s CAC 40 (FR40) closed down 0.43%, Spain’s IBEX 35 (ES35) fell by 0.12%, and the UK’s FTSE 100 (UK100) closed negative 0.43%. Major European equity markets fell after an early rally driven by the US-EU trade deal. The framework agreement includes a 15% import tariff on most EU goods, as well as an EU commitment to purchase $750 billion worth of energy and additional military equipment from the US. The deal also provides selective access to key segments of the European market. While considered a better outcome than the previously threatened 30–50% tariffs proposed by Trump, lingering uncertainty over the final terms sparked concern among European leaders.

WTI crude oil prices jumped more than 2% to $66.70 per barrel on Monday amid renewed geopolitical fears after US President Donald Trump accelerated the deadline for Russia to agree to a ceasefire in Ukraine. Trump warned that Russia has 10–12 days to comply or face 100% “secondary tariffs,” raising concerns over potential disruptions in oil supplies. This follows new EU sanctions, including a lower price cap on Russian oil and a ban on importing petroleum products from third countries, set to take effect in January. If fully implemented, such measures could reduce global oil supply, especially given OPEC’s limited spare capacity.

The US natural gas prices dropped to $3.07 per million British thermal units (MMBtu), the lowest level since April 22, as weaker-than-expected summer heat and high production levels kept downward pressure on prices throughout July. Meanwhile, production remained high, averaging 107.2 billion cubic feet per day across the lower 48 US states in July, exceeding June’s record of 106.4 billion cubic feet per day. Inventories were about 6% above seasonal norms, reinforcing the view of an oversupplied market.

On Monday, silver prices remained under pressure, staying below $38.50 per ounce after falling more than 2% in the previous session, as recent trade deals between the US and key partners reduced demand for safe-haven assets. Meanwhile, markets are watching for further developments in US-China trade talks, which begin today in Stockholm, with expectations that discussions will go beyond tariffs and include broader geopolitical and economic issues.

Asian markets were mostly up yesterday. Japan’s Nikkei 225 (JP225) dropped by 1.10%, China’s FTSE China A50 (CHA50) rose by 0.19%, Hong Kong’s Hang Seng (HK50) climbed by 0.68%, and Australia’s ASX 200 (AU200) posted a positive result of 0.36%.

Thailand aims to finalize trade negotiations with the US by the August 1 deadline, and US tariffs are unlikely to reach 36%, Finance Minister Pichai Chunhavajira said on Tuesday. Bangkok expects a “very favorable” trade deal from the Trump administration following a peace initiative that resolved the border conflict with Cambodia. In 2024, the US was Thailand’s largest export market, accounting for 18.3% of total exports, or $54.96 billion, while the US trade deficit with Thailand stood at $45.6 billion.

Hong Kong’s trade deficit widened to $58.9 billion in June 2025 from $55.7 billion in the same month last year. Exports rose by 11.9% year-over-year to $417.8 billion. Meanwhile, imports increased by 11.1% to $476.7 billion. Imports from most major suppliers showed strong growth, particularly from Vietnam (+50.6%), the United Kingdom (+44.7%), and the US (+3.9%).

On Thursday, the US stocks traded mixed: the Dow Jones Index (US30) fell by 0.70%. The S&P 500 (US500) rose by 0.07%, and the tech-heavy Nasdaq (US100) closed higher by 0.25%. The S&P 500 and Nasdaq 100 both ended Thursday at record highs, supported by strong earnings from Alphabet, which boosted investor confidence in AI-related investments.

Alphabet shares rose by 1% after the company beat Q2 expectations and raised its capital expenditure forecast for 2025 by $10 billion, lifting other tech giants like Microsoft, Nvidia, and Amazon. Tesla fell by 7.9% after CEO Elon Musk warned of challenging quarters ahead. Markets also focused on an unexpected visit by President Trump to the Federal Reserve, where he increased pressure on Chairman Powell regarding interest rates. Meanwhile, trade negotiations remained a key topic: progress was reported in talks with the EU, Japan, and South Korea, although Trump stated that tariffs would not fall below 15%.

The Canadian dollar traded near 1.36 per US dollar, rebounding sharply from the July 17 low of 1.374, aided by a weakening US dollar as optimism returned around US trade deals with Japan and the EU, possibly preventing tariff escalation. Rising crude oil prices also supported Canada’s export revenues and lent further strength to the loonie. However, the rally paused as markets shifted focus to the looming August 1 tariff deadline, with US-Canada talks deadlocked. At the same time, stronger June retail sales likely support domestic growth expectations and increase pressure on the Bank of Canada to extend its easing cycle.

European stock markets traded higher yesterday. Germany’s DAX (DE40) rose by 0.23%, France’s CAC 40 (FR40) closed down 0.41%, Spain’s IBEX35 (ES35) gained 1.34%, and the UK’s FTSE 100 (UK100) ended the day 0.85% higher. On Thursday, European stocks closed higher as markets evaluated the outlook for EU trade and monetary policy. The ECB kept interest rates unchanged and noted that disinflation is progressing in line with its previous forecasts. The central bank also stated that more information on economic developments is needed for further policy clarity. Nevertheless, markets trimmed expectations for rate cuts this year after ECB President Christine Lagarde said that cuts might be unjustified. Meanwhile, reports emerged that the US is likely to agree to reduce tariffs on the EU to 15%, the lowest level applied to other countries, amid a trade deal that EU diplomats are close to finalizing.

The UK’s GfK Consumer Confidence Index fell to 19 in July 2025 from 18 in June, pulling back from a six-month high as households became more cautious amid growing concerns about taxes and inflation. Finance Minister Rachel Reeves is expected to raise taxes for the second consecutive year in her upcoming budget, after Prime Minister Keir Starmer scrapped previous plans to cut billions in welfare spending. Amid uncertainty, households boosted savings, with GfK’s savings index jumping 7 points to 34, its highest since November 2007, reflecting a shift toward financial prudence.

Hopes that easing trade tensions will support global economic growth helped ease concerns over future oil demand. WTI crude prices rose 1.2% to $66 per barrel on Thursday, breaking a four-day losing streak. On the supply side, US crude inventories fell by 3.2 million barrels last week, more than double analysts’ expectations, signaling strong demand.

Asian markets mostly advanced yesterday. Japan’s Nikkei 225 (JP225) rose by 1.59%, China’s FTSE China A50 (CHA50) gained 0.11%, Hong Kong’s Hang Seng (HK50) increased by 0.51%, while Australia’s ASX 200 (AU200) declined by 0.32%.

In New Zealand, markets are pricing in a roughly 75% chance that the Reserve Bank of New Zealand will cut its official cash rate by 25 basis points from 3.25% at its August meeting, though investors suspect it may be near the end of the easing cycle. Meanwhile, RBNZ Chief Economist Paul Conway said Thursday that the central bank is prepared to lower rates further if price pressures continue to ease as expected, warning that US tariffs could weigh on economic growth and inflation. This week, the New Zealand dollar rose by 1%, ending a two-week losing streak.

The Australian dollar fell to around 0.658 USD on Friday, extending losses from the previous session as investors remained cautious ahead of next week’s key inflation data releases. Both monthly and quarterly inflation figures are expected, which could play a pivotal role in shaping the Reserve Bank of Australia’s monetary policy outlook. RBA Governor Michele Bullock recently emphasized that the central bank is not ready to cut interest rates until stronger evidence emerges that inflation is sustainably returning to its 2.5% target, defending the RBA’s slow and steady approach.

At the end of Monday, the Dow Jones Index (US30) declined by 0.04%. The S&P 500 Index (US500) gained 0.14%. The Nasdaq Technology Index (US100) closed higher by 0.50%. The S&P 500 and Nasdaq 100 indexes closed at record highs on Monday as optimism over strong corporate earnings outweighed lingering trade tensions. Growth in mega-large tech companies, such as Alphabet, Amazon, and Meta, fueled the rally. Alphabet rose by 2.7% ahead of Wednesday’s earnings report. Verizon shares also rose by 4% after the release of a strong quarterly report, fueling hopes for continued earnings growth. So far, more than 85% of companies reporting on the S&P 500 have beaten expectations, with the large technology industry expected to provide most of the projected 6–7% earnings growth this quarter. Investor sentiment remained upbeat despite uncertainty over tariffs. Commerce Secretary Howard Lutnick again called August 1 a “hard deadline” for compliance, although negotiations could continue beyond that.

Equity markets in Europe were mostly up yesterday. Germany’s DAX (DE40) rose by 0.08%, France’s CAC 40 (FR40) closed down 0.31%, Spain’s IBEX35 (ES35) added 0.30%, and the UK’s FTSE 100 (UK100) closed positive 0.23%. European stocks posted modest losses on Monday as markets continued to assess the outlook for EU trade. The US authorities maintained their threat to impose 30% tariffs on EU exports, while the EU Commission continued to negotiate lower duty rates until August 1. At the same time, the EU also signaled that aggressive retaliatory measures would follow in the absence of an agreement, risking escalation of tensions and price hikes in the bloc. Luxury giants led the session’s losses, with Hermes, LVMH, and Ferrari falling 0.5–1.6%. Meanwhile, Stellantis lost 1.5% despite reporting a loss of more than €2.3 billion in the first half of the year due to restructuring costs and US tariffs. In addition, Ryanair jumped 5.7% after reporting that its first-quarter net profit more than doubled.

WTI crude oil prices held near the 67.1 dollar per barrel mark on Monday. The focus remained on US-EU trade talks ahead of potential US tariffs on EU imports from August 1, while the EU stepped up pressure on Russia with its 18th package of sanctions. The new measures include lower price caps on Russian crude, restrictions on the supply of oil products, and a ban on a major Indian refinery using Russian crude. China has responded to EU sanctions targeting its banks and firms by vowing to protect its interests. Meanwhile, Iran will hold nuclear talks with EU countries this Friday amid threats of renewed international sanctions.

The US natural gas (XNG/USD) prices fell more than 6% to $3.34/MMBtu on Monday, reversing part of the 7% gain made last week as prices were pressured by high supply and lower demand expectations. Production reached a new record in July, averaging 107.0 billion cubic feet per day (bcf/day), surpassing the previous June high of 106.4 bcf/day. This surge in production allowed energy companies to pump 46 bcf into storage during the week ended July 11, well above both the 18 bcf added during the same week last year and the five-year average of 41 bcf. As a result, total gas inventories are now 6.2% above the seasonal norm.

Silver prices (XAG/USD) rose to $38.9 an ounce, the highest level since August 2011, as the US dollar and Treasury yields declined amid concerns about ongoing trade talks and growing expectations of a Federal Reserve rate cut. Fed spokesman Christopher Waller reiterated his support for easing rates in July, citing a weakening labor market and lower inflation risks. He also downplayed the inflationary impact of rates, calling it temporary, and stated that there are no signs of rising inflation expectations, giving the Fed room to act. Further support for silver came from China, where the Ministry of Industry pledged to stabilize growth in key sectors such as machinery, automobiles, and electrical equipment. This initiative is aimed at modernizing production and is expected to boost demand for metals.

Asian markets traded yesterday without any single dynamics. Japanese Nikkei 225 (JP225) fell by 0.21%, Chinese FTSE China A50 (CHA50) rose by 0.33%, Hong Kong Hang Seng (HK50) rose by 0.68%, and the Australian ASX 200 (AU200) yesterday showed a negative result of 1.02%.

The Reserve Bank of Australia (RBA) considered a third rate cut in four meetings, but ultimately stayed on hold, deeming such a move inconsistent with a strategy of cautious and gradual easing, minutes of the July meeting showed. A minority of the Council’s representatives supported a rate cut, citing downside risks to global economic growth and weak domestic GDP, which could lead to a faster decline in inflation than previously expected.

Hong Kong’s annualized inflation rate fell to 1.4% in June 2025 from 1.9% in the previous month, the slowest pace in three months. On a month-on-month basis, consumer prices were unchanged in June after falling 0.3% in May.

Malaysia’s annualized inflation rate for June 2025 was 1.1%, slightly below the market consensus and May’s 1.2%. This is the lowest rate since February 2021. Core inflation, which excludes volatile fresh food and administrative prices, held at 1.8% y/y for the second month, remaining at the highest level since November 2023.