InvestMacro

At the end of Wednesday, the Dow Jones (US30) Index was up 0.49%. The S&P 500 (US500) Index rose by 0.61%. The Nasdaq (US100) technology Index closed higher by 0.94%. US stocks closed higher on Wednesday as investors assessed the impact of tariff expansion on corporate earnings and future Federal Reserve policy. Minutes from the Fed’s June meeting showed that officials view the recently announced tariffs as inflationary, prompting them to delay resuming interest rate cuts that were previously planned for earlier this year. The announcement came shortly after President Trump expanded the list of countries subject to US tariffs, effective August 1, to include the Philippines, Iraq, and possibly Brazil.

Nvidia (NVDA) became the first company to reach a market value of $4 trillion. Shares of the leading chipmaker rose about 2.4% to $164, thanks to continued growth in demand for artificial intelligence technology. Nvidia’s chips and related software are considered global leaders in the creation of artificial intelligence products.

The Mexican peso strengthened above 18.6 per US dollar, reaching an 11-month high, as investors assessed the ongoing price pressure against a strong external balance. The unexpected rise in core inflation in June to 4.24%, the highest level since April 2024, caused the market to maintain expectations of cautious rate cuts by the Bank of Mexico, which allowed it to maintain a significant margin of real yield even after the June 26 decision to cut the benchmark rate by 50 basis points to 8%. In the external market, a slight recovery in the US dollar against the backdrop of renewed threats of tariffs was offset in the local market by Mexico’s progress in negotiations to delay or soften retaliatory duties.

Bitcoin (BTC/USD) reached a new record high of $112,000, as investors shifted to riskier assets amid a broad rally in the stock market. Since the beginning of the year, Bitcoin has risen by more than 18% due to sustained institutional demand, as traditional financial players increasingly embrace the world’s largest cryptocurrency. The Trump administration’s pro-cryptocurrency stance has also bolstered the digital asset market, driving fresh capital into the sector.

European stock markets were mostly higher on Wednesday. Germany’s DAX (DE40) rose by 1.42%, France’s CAC 40 (FR40) closed up 1.44%, the Spanish IBEX35 (ES35) added 1.24%, and the British FTSE 100 (UK100) closed 0.15%. On Wednesday, the DAX index continued to rise, climbing more than 1% and surpassing the 24,500-point mark, reaching a new all-time high with the support of defensive stocks, as traders await news on the progress of trade negotiations. President Trump said he would likely notify the EU of the proposed export duty rate in the coming days, adding that negotiations with the EU were progressing well. The European Commission recently reiterated its goal of reaching a framework agreement with the US on the trade dispute by the end of this week.

WTI oil prices rose slightly on Wednesday and closed at $68.4 per barrel as traders assessed an unexpected increase in US oil inventories amid renewed tensions in the Red Sea and forecasts of a decline in US production. The EIA reported a 7.1 million barrel increase in US oil inventories for the week ending July 4, contrary to expectations of a 2.1 million barrel decline. Prices were supported by renewed Houthi attacks in the Red Sea, including an attack that sank a cargo ship and killed at least four crew members.

The US natural gas (XNG/USD) prices fell 5% to below $3.2 per million British thermal units (MMBtu) on Wednesday, the lowest in six weeks, due to rising supply and high inventory levels. In July, production in the 48 contiguous US states averaged 106.7 billion cubic feet per day (bcfd), surpassing June’s record high of 106.4 bcfd. Gas inventories remain about 6% above the five-year average, and analysts expect another above-average weekly increase — the 11th in 12 weeks. Despite this surplus, demand remains high due to forecasts of hotter-than-usual weather through the end of July, leading to increased electricity consumption for air conditioning.

Asian markets traded without a single trend. Japan’s Nikkei 225 (JP225) rose by 0.33%, China’s FTSE China A50 (CHA50) added 0.18%, Hong Kong’s Hang Seng (HK50) lost 1.06%, and Australia’s ASX 200 (AU200) showed a negative result of 0.61% yesterday.

The Central Bank of Malaysia lowered its base interest rate by 25 basis points to 2.75% at its monetary policy meeting in July 2025, in line with market expectations. This was the first rate cut in five years, underscoring the central bank’s desire to support domestic economic momentum amid weakening growth prospects and rising uncertainty in global trade. In the first five months of the year, headline and core inflation averaged 1.4% and 1.9%, respectively. Meanwhile, Malaysia’s GDP grew by 4.4% year-on-year in the first quarter of 2025, in line with early estimates but below the revised growth rate of 4.9% in the previous quarter.

At the end of Tuesday, the Dow Jones Index (US30) fell by 0.37%. The S&P 500 (US500) Index fell by 0.07%. The Nasdaq (US100) technology index closed higher by 0.03%. On Tuesday, US stocks were virtually unchanged as investors tried to make sense of President Trump’s mixed signals on tariffs. Trump initially postponed the return of comprehensive “Liberation Day” tariffs until August 1, but then changed course and said there would be no further extensions, further exacerbating trade instability. Markets reacted sharply to Trump’s announcement of high 50% tariffs on copper imports, causing copper futures to jump more than 10% and shares in producers such as Freeport-McMoran and Southern Copper to rise. Meanwhile, pharmaceutical stocks pared gains after Trump hinted at imposing a 200% tariff on foreign-made drugs but offered a one-year grace period.

US consumer inflation expectations for the coming year fell to 3% in June 2025 from 3.2% in May, the lowest level in five months. Meanwhile, inflation expectations for the three-year and five-year horizons remained unchanged at 3.0% and 2.6%, respectively.

European stock markets were mostly up on Tuesday. Germany’s DAX (DE40) rose by 0.55%, France’s CAC 40 (FR40) closed up 0.56%, the Spanish IBEX35 (ES35) rose by 0.03%, and the British FTSE 100 (UK100) added 0.54%. The US imposed tariffs on major Asian trading partners in addition to sectoral tariffs. Still, we excluded the EU, noting statements by EU officials that the US minimum tariff of 10% could be reached. Car manufacturers benefited from the negative impact of tariffs on Asian competitors, with BMW and Stellantis adding 2% and 3%, respectively. In addition, UniCredit added 1.9% as the EU is expected to reject the Italian government’s conditions for the acquisition of Banco BPM, increasing the likelihood of the deal going through.

WTI crude oil futures rose by 0.6% to close at $68.3 per barrel on Tuesday, hovering near a two-week high, as investors assessed the impact of new US tariffs and a larger-than-expected increase in OPEC+ production in August. President Trump’s announcement of tariffs on 14 countries raised concerns about global economic growth and oil demand. On Saturday, OPEC+ agreed to increase production by 548,000 barrels per day in August, marking the fourth consecutive monthly increase and exceeding analysts’ expectations. The move will restore nearly 80% of the 2.2 million barrels per day that eight OPEC members voluntarily cut. Meanwhile, API and EIA data on oil inventories are expected to show a decline of 2.6 million barrels for the week ending July 4, marking the sixth consecutive decline in seven weeks.

Asian markets were mostly lower yesterday. Japan’s Nikkei 225 (JP225) rose by 0.26%, China’s FTSE China A50 (CHA50) gained 0.42%, Hong Kong’s Hang Seng (HK50) added 1.09%, and Australia’s ASX 200 (AU200) showed a positive result of 0.02%.

In China, consumer prices rose slightly in June after four months of decline, indicating continued high deflationary pressure. Meanwhile, producer prices experienced their sharpest decline in nearly two years amid fierce competition among Chinese companies, persistently weak domestic demand, and growing risks of tariffs.

The New Zealand dollar fell to $0.598 on Wednesday, its lowest level in two weeks, after the Reserve Bank of New Zealand (RBNZ) paused its cycle of interest rate cuts but signaled that further easing was likely if price pressures eased. The central bank kept its official refinancing rate at 3.25%, as expected, after six consecutive cuts since August 2024, when it first lowered the rate since March 2020. Policymakers expect rates to continue falling, in line with May forecasts, provided that medium-term inflation continues to decline. Markets also expect that the ongoing economic weakness will allow the RBNZ to make at least one more rate cut at the end of this year.

At the end of Monday, the Dow Jones index (US30) fell by 0.94%. The S&P 500 Index (US500) fell by 0.79%. The Nasdaq (US100) tech index closed down 0.92%. The US stocks fell sharply on Monday as President Trump reignited trade tensions by announcing new tariffs and extending the deadline for their implementation to August 1. Trump posted letters on social media announcing the introduction of 25% tariffs on imports from Japan and South Korea, as well as additional duties of up to 40% on goods from countries such as Malaysia, Myanmar, and South Africa. He also warned of additional 10% tariffs for countries joining the “anti-American BRICS policy” as the bloc holds a summit in Brazil. Treasury Secretary Scott Bessent confirmed that new trade announcements are expected within 48 hours. Shares in trade-sensitive companies, such as Toyota (-3.9%), Honda (-3.8%), Apple (-1.7%), and AMD (-2.2%), fell. In comparison, Tesla fell 6.8% after Elon Musk’s announcement of a new political party sparked a negative reaction from investors

European stock markets were mostly up on Monday. Germany’s DAX (DE40) rose by 1.20%, France’s CAC 40 (FR40) closed up 0.35%, the Spanish IBEX35 (ES35) added 0.73%, and the British FTSE 100 (UK100) closed down 0.19% yesterday. Notable leaders included Allianz, Münchener Rück, Deutsche Bank, Commerzbank, Airbus, and Siemens Energy, which gained between 0.8% and 1.1%. German industrial production rose by 1.2% month-on-month in May, exceeding expectations of no change and recovering from a revised 1.6% decline in April.

Annual inflation in Sweden rose to 0.8% in June 2025, accelerating from 0.2% in May and exceeding expectations of a rise to 0.4%. This is the highest figure since February, but still well below the Riksbank’s target of 2%. Every month, consumer prices rose 0.5% — the most in four months — after rising 0.1% in May. Meanwhile, the fixed interest rate CPI (CPIF), the Riksbank’s target, rose to 2.9% year-on-year in June, the sharpest increase since February, compared with 2.3% in May and above forecasts of 2.5%.

WTI oil prices rose by 1.4% to $67.90 per barrel on Monday, rebounding from previous lows despite a larger-than-expected increase in OPEC+ production and concerns about possible US tariffs. In a sign of confidence in demand, Saudi Arabia raised its August Arab Light oil price to a four-month high for Asia. Meanwhile, markets are closely watching US trade policy, as Trump’s tariffs on certain countries are set to take effect on August 1. Although oil remains supported by supply shortages, tariff uncertainty continues to cloud the outlook for the second half of 2025.

On Monday, silver prices fell about 1% to $36.50 an ounce, retreating from 13-year highs, as President Donald Trump effectively extended the deadline for retaliatory tariffs, weakening demand for safe-haven currencies. Treasury Secretary Scott Bessent said tariffs would return to April 2 levels for countries that had not reached a deal with the US by that date, allowing more time for trade negotiations to proceed. So far, only China, the UK, and Vietnam have reached partial agreements with Washington.

Asian markets were mostly down yesterday. Japan’s Nikkei 225 (JP225) fell by 0.56%, China’s FTSE China A50 (CHA50) declined by 0.42%, Hong Kong’s Hang Seng (HK50) lost 0.12%, and Australia’s ASX 200 (AU200) showed a negative result of 0.16%.

At its July meeting, the Reserve Bank of Australia (RBA) maintained its cash rate at 3.85%, contradicting market forecasts of a 25-basis-point rate cut. The central bank cited a more balanced outlook for inflation risks and strong labor market conditions as the main reasons for maintaining its current policy. Nevertheless, the board remains cautious about the outlook amid uncertainty about aggregate demand and supply. Policymakers noted that they would wait for additional data to confirm that inflation is on track to return to the 2% target in a sustained manner.

In New Zealand, the Reserve Bank (RBNZ) is widely expected to keep rates unchanged, pausing its aggressive cuts for the first time since August last year. Markets currently expect at least one more 25-basis-point cut at the end of this year due to the risks of slower growth linked to the economic impact of US tariffs.

The US stock indices did not trade on Friday due to the US Independence Day holiday.

The dispute between Republican President Donald Trump and his campaign’s chief financier, Elon Musk, took a new turn on Saturday when the billionaire space and car industry magnate announced the creation of a new political party, saying that Trump’s “big and beautiful” tax bill would bankrupt America. Earlier last week, Trump threatened to strip Musk’s companies of the billions of dollars in federal subsidies they receive. Despite Musk’s deep pockets, breaking the Republican-Democratic duopoly will not be easy, given that it has dominated American political life for more than 160 years, and Trump’s approval rating in polls during his second term has generally remained above 40%.

BRICS leaders are expected to sign a joint statement condemning the “rise of unjustified unilateral protectionist measures” and “disorderly increases” in tariffs. The final wording is unlikely to mention the US directly. But the group is sending an unambiguous signal to the Trump administration ahead of July 9, when his tariffs are set to take effect. US President Donald Trump announced on Sunday that any country that joins the BRICS bloc’s “anti-American policy” will face additional 10% tariffs.

The Mexican peso strengthened to 18.65 per US dollar, its strongest level since mid-August 2024. In the external market, the unexpectedly large US budget package in June and the approaching deadline for Trump’s tariffs weakened the dollar, while Mexico’s trade surplus in May was US$1.03 billion, and record remittances of US$5.5 billion ensured an inflow of hard currency into the country. In the domestic market, Banxico’s decision on June 26 to cut its key rate by 50 basis points to 8%, while confirming that further cuts would occur in anticipation of sustained disinflation, maintained an attractive real interest rate that supported the yield differential between the peso and the dollar.

Equity markets in Europe were mostly down on Friday. The German DAX (DE40) fell by 0.61% (-1.33% for the week), the French CAC 40 (FR40) closed down 0.75% (-0.24% for the week), the Spanish IBEX35 (ES35) Index lost 1.48% (-0.40% for the week), and the British FTSE 100 (UK100) closed down 0.01% (+0.27% for the week). On Friday, European stocks closed lower amid ongoing tensions in trade relations with the United States. The EU Commission said it was close to developing a framework trade agreement with the US to avoid the reintroduction of aggressive tariffs by the July 9 deadline. In turn, ECB officials noted that they may not reach their 2% inflation target if the euro remains at $1.20 for an extended period.

OPEC+ countries agreed to a larger-than-expected increase in oil production in August. The eight countries that comprise the OPEC+ oil-producing alliance agreed to increase oil production in August by 548,000 barrels per day, exceeding expectations. The group includes the largest oil producers — Russia and Saudi Arabia — as well as Algeria, Iraq, Kazakhstan, Kuwait, Oman, and the United Arab Emirates. These countries are winding down their voluntary production cuts of 2.2 million barrels per day. The increase in production by 548,000 barrels per day, coupled with the winding down of voluntary cuts of 2.2 million barrels per day, means a significant increase in supply. If demand does not grow proportionally, this will lead to an oversupply in the market, which could potentially lower oil prices. On the other hand, seasonal growth in demand in the summer may partially offset the effect of increased supply.

On Friday, silver prices (XAG/USD) remained above $36.80 per ounce, approaching 13-year highs, as renewed tensions in global trade boosted demand for safe-haven assets. Investors remained on edge after President Donald Trump announced plans to begin sending letters describing new trade tariffs or potential extensions as early as Friday, adding to uncertainty in global markets. Further market anxiety was caused by the US House of Representatives passing Trump’s tax and spending bill, which is now headed to the White House for signing. The bill is expected to increase the federal budget deficit by more than $3 trillion, raising long-term fiscal concerns.

Asian markets traded without any clear trend last week. Japan’s Nikkei 225 (JP225) fell by 1.82%, China’s FTSE China A50 (CHA50) rose by 1.60%, Hong Kong’s Hang Seng (HK50) lost 2.19%, and Australia’s ASX 200 (AU200) showed a positive result of 1.04% over the past week.

Vietnam’s annual GDP growth rate in the second quarter of 2025 was 7.96% year-over-year (y/y), accelerating from 6.93% in the first quarter and marking the highest rate since the third quarter of 2022. The latest result reflects significant progress toward Hanoi’s target of at least 8% economic growth. Washington and Hanoi have signed a trade agreement under which Vietnamese goods will be subject to a 20% tariff, and transshipment of goods from third countries through Vietnam will be subject to a 40% tax. In return, Vietnam can import American goods without tariffs. Vietnam’s annual inflation rate rose to 3.57% in June 2025, from 3.24% in the previous month, marking the highest level since January. Core inflation, which excludes volatile items, rose to 3.46%, the highest since September 2023.

At the end of Wednesday, the Dow Jones Index (US30) fell by 0.02%. The S&P 500 Index (US500) rose by 0.47% and reached a new all-time high. The Nasdaq Technology Index (US100) closed higher by 0.73%. Markets were buoyed by strong gains in technology stocks and news of a trade agreement between the US and Vietnam. President Donald Trump announced on Wednesday that the US would impose 20% tariffs on imports from Vietnam under a new trade deal struck in last-minute negotiations. Previously, Vietnamese goods were to be subject to 46% duties starting next week as part of the “reciprocal” tariff policy introduced by Trump in April. Meanwhile, other major economies, such as the EU and Japan, are still trying to conclude their own agreements with the US.

The latest ADP data showed that private sector employment unexpectedly declined in June, the first decline in more than two years, raising new concerns about the strength of the labor market and supporting the case for monetary policy easing.

Today, important data on the US labor market will be released in the US, namely the Non-Farm Payrolls report. The publication date has been moved up a day due to the US holiday on Friday, July 4 (Independence Day). If the data is in line with analysts’ expectations, such a report will indicate a continuing slowdown in the labor market, but without a sharp deterioration. Higher wage growth rates may alarm the Fed in the context of inflationary pressure, reducing the likelihood of an early easing of monetary policy. The market reaction is neutral for both the US dollar and gold and stocks. A weak labor market report may reinforce expectations of a Fed rate cut in the coming months. We can expect a negative reaction from the US dollar, growth in risk assets (EUR, GBP, AUD), growth in stock indices and gold.

Stock markets in Europe were mostly up on Wednesday. The German DAX (DE40) rose by 0.49%, the French CAC 40 (FR40) closed up 0.99%, the Spanish IBEX35 (ES35) added 0.41%, and the British FTSE 100 (UK100) closed down 0.12%. The Frankfurt DAX Index rose by about 0.5%, interrupting two days of losses, amid growing expectations of a positive outcome to trade negotiations. The US is reportedly insisting on introducing 10% tariffs, while the EU is seeking exemptions for sectors such as alcohol, aircraft manufacturing, pharmaceuticals, and semiconductors. Meanwhile, ECB officials at the Sintra summit expressed growing concern that the strengthening of the euro could affect inflation.

WTI crude oil prices fell below $67 a barrel on Thursday, cutting gains from the previous session, as an increase in US crude oil inventories heightened concerns about weak demand from the main consumer. Official data showed that crude oil inventories rose by 3.85 million barrels last week, defying expectations of a 2 million barrel decline and marking the largest increase in three months. Adding further pressure is the fact that OPEC+ appears set to increase production by 411,000 barrels per day in August, bringing the total increase through 2025 to 1.78 million barrels per day, equivalent to more than 1.5% of global demand.

Asian markets were mostly up yesterday. Japan’s Nikkei 225 (JP225) fell by 0.56%, China’s FTSE China A50 (CHA50) rose by 0.11%, Hong Kong’s Hang Seng (HK50) added 0.62%, and Australia’s ASX 200 (AU200) showed a positive result of 0.66%.

The Bank of Japan should resume raising rates after a temporary pause to assess the impact of US tariffs on the Japanese economy, a BoJ board member said on Thursday. According to Takata, Japan is approaching its 2% inflation target, helped by strong corporate earnings, labor shortages, and wage growth. He also warned that if the Fed resumes cutting rates, it could reduce the Bank of Japan’s policy flexibility. However, Takata sees no signs of a recession in the US.

The Australian dollar fell to $0.657 on Thursday, ending a three-session winning streak amid weak trade data. Australia’s trade surplus narrowed sharply to 2.24 billion Australian dollars in May, well below expectations of 5.09 billion Australian dollars and the revised figure of 4.86 billion Australian dollars in April. This was the smallest surplus in nearly five years, with exports falling to a three-month low due to weaker shipments from the US, which were affected by tariffs. Additional pressure came from data on the PMI index in the services sector of China, Australia’s main trading partner, which fell to a nine-month low and failed to meet expectations.

At the end of Tuesday, the Dow Jones Index (US30) rose by 0.91%. The S&P 500 Index (US500) fell by 0.11%. The Nasdaq (US100) Tech Index closed down 0.82%. The US stocks closed mixed on Tuesday after the Senate passed President Trump’s massive budget bill, while investors also kept an eye on trade developments. Enthusiasm about potential economic stimulus was tempered by concerns about the bill’s multi-trillion-dollar cost. The bill is projected to increase the national debt by $3.3 trillion. Tesla fell by 5.3% after Trump escalated his feud with Elon Musk, threatening to strip him of federal subsidies. Fed Chairman Jerome Powell maintained a cautious tone on rate cuts, noting tariff-related inflation risks and emphasizing the need for additional data.

European stock markets were mostly lower on Tuesday. Germany’s DAX (DE40) fell by 0.99%, France’s CAC 40 (FR40) closed down 0.04%, the Spanish IBEX35 (ES35) Index fell by 0.03%, and the British FTSE 100 (UK100) closed positive 0.28%. European stocks fell on Tuesday amid trade uncertainty and doubts that the ECB will continue to cut interest rates. According to reports, the EU is open to a deal that would impose a 10% universal tariff on many types of exports, but is demanding concessions from the US in key sectors such as pharmaceuticals, alcohol, semiconductors, and commercial aircraft. The head of the EU trade department is expected to lead a delegation to Washington this week to try to advance the negotiations. On the data front, preliminary figures showed the Eurozone inflation at 2%, as expected, and in line with the ECB’s target. Meanwhile, ECB chief economist Philip Lane said the recent cycle of Central Bank policy tightening was over.

WTI oil prices are holding steady at around $65 per barrel on Wednesday after rising in the previous session, as investors remain cautious ahead of OPEC+’s production decision. The group intends to increase production by 411,000 barrels per day in August, resulting in a total increase in production in 2025 of 1.78 million barrels per day — more than 1.5% of global demand. This move is seen both as a punishment for overproducers and as an attempt by Saudi Arabia to win market share from US shale fields and other countries.

Asian markets were mostly down yesterday. Japan’s Nikkei 225 (JP225) fell by 1.24%, China’s FTSE China A50 (CHA50) rose by 0.25%, Hong Kong’s Hang Seng (HK50) did not trade yesterday, and Australia’s ASX 200 (AU200) showed a negative result of 0.01%.

The Nikkei 225 (JP225) Index fell by 1.1% on Wednesday, marking the second consecutive day of losses for Japanese stocks. The decline came after US President Donald Trump threatened to impose 35% tariffs on Japanese imports in an attempt to pressure Tokyo into making trade concessions. Trump called negotiations with Japan “very tough,” repeating his criticism of the country’s unwillingness to accept American-made cars and rice. His comments heightened investor concerns, especially after Federal Reserve Chairman Jerome Powell said the Fed would have already cut interest rates if not for the inflationary impact of Trump’s tariffs.

On Wednesday, the New Zealand dollar traded around US$0.609, close to its highest level in more than eight months, helped by the general weakening of the US dollar. Meanwhile, investors are closely watching trade developments as many countries try to reach an agreement with the US before the July 9 deadline. In the domestic market, the Reserve Bank of New Zealand is expected to keep rates at 3.25% next week, with market prices indicating only a small chance of a 25 basis point cut.

The Australian dollar weakened to $0.656 on Wednesday, retreating from the previous session as weaker-than-expected domestic data dampened investor sentiment. The Australian Bureau of Statistics reported that retail sales rose 0.2% in May, higher than the revised April figure but below market expectations of 0.4% growth. The data reinforced expectations that the Reserve Bank of Australia will cut rates by 25 basis points to 3.60%, with markets increasingly pricing in the possibility of further easing in the second half of the year, which could see rates fall to 3.10% or even 2.85%.