TL;DR

Trump tariffs hit 70 countries; global equities slide; China halts US-bound investments.

Highlights

• Trump imposes tariffs of 10–41% on imports from nearly 70 countries; Canada faces 35% duty, EU threatened with 30% tariffs pending talks120.
• China halts approvals for US-bound investments; accuses US of cyberattacks on defense contractors210.
• Global equities fall sharply; Asia leads declines, with Korea’s KOSPI down nearly 4% on tariffs and domestic tax proposals35.
• US dollar strengthens 1.5% this week; two-year Treasury yields ease to 3.94% as risk aversion rises3.
• Apple projects $1.1B in additional Q3 costs from new tariffs; continues supply chain diversification14.
• China’s top solar firms cut 31% of jobs after $60B in losses; Beijing signals possible industry intervention6.
• PBOC sets firmer yuan fix, but CNY hits two-month low on growth and rate differential concerns4.
• SEC launches “Project Crypto” to modernize digital asset rules; Coinbase to offer tokenized stocks to US users1118.
• Tether posts record $4.9B Q2 profit, now holds $127B in US Treasuries12.
• Visa expands stablecoin settlement to new tokens and blockchains13.
• UK Supreme Court to rule on car finance mis-selling; banks face multibillion-pound compensation risk19.
• South Africa cuts rates to 7% as inflation eases; Panama moves to void CK Hutchison’s canal port concession1715.
• US envoy heads to Moscow as Ukraine cease-fire deadline nears; further sanctions threatened9.
• Pakistan’s Cnergyico books first US oil cargo after Trump-backed trade deal, diversifying supply16.

Commentary

The latest round of US tariffs—ranging up to 41% and targeting a broad swath of countries—has triggered a pronounced risk-off move across global markets13. Asian equities bore the brunt, with South Korea’s KOSPI falling nearly 4% amid both US trade actions and new domestic tax proposals35. The US dollar’s continued strength and lower Treasury yields reflect heightened risk aversion, while gold and other safe havens see renewed interest312. Apple ’s warning of a $1.1B Q3 tariff hit underscores the immediate impact on multinational earnings and supply chains14.

China’s response has been swift, halting approvals for outbound US-bound investments and escalating cybersecurity accusations210. The yuan , despite a firmer central bank fix, continues to weaken as growth concerns and US rate differentials weigh4. In parallel, China’s solar sector faces deep structural challenges, with major manufacturers cutting a third of their workforce after steep losses6. Beijing is signaling a willingness to intervene, but industry consolidation remains uncertain67.

The US is also pressuring the EU and Canada with tariff threats, while negotiations continue120. The EU is readying countermeasures, raising the risk of further trade disruptions, particularly in autos and industrials20. Meanwhile, the UK Supreme Court’s pending car finance ruling could trigger significant liabilities for banks, adding to financial sector uncertainty19.

In digital assets, regulatory momentum is building. The SEC’s “Project Crypto” and Visa ’s stablecoin expansion point to deeper blockchain integration in financial infrastructure1113. Tether ’s record profit and growing US Treasury holdings highlight the increasing intersection between crypto and traditional markets12. Coinbase ’s move to offer tokenized stocks signals further convergence, especially as regulatory clarity improves18.

Traders should monitor upcoming tariff deadlines, central bank signals, and key data releases for further volatility. Watch for continued dollar strength, pressure on EM currencies, and sector rotation in equities as trade and regulatory risks evolve34.

TL;DR

US ramps tariffs on India, copper, and EU goods; BOJ holds rates; Microsoft, Meta post strong AI-driven earnings.

Highlights

• China’s cyber regulator summoned Nvidia over alleged “backdoor” vulnerabilities in H20 AI chips, raising risks for US tech exports.1
• Trump imposed a 50% tariff on US copper semi-finished imports (excluding refined copper), triggering a 19.5% drop in COMEX copper futures.2
• US to levy 25% tariff on all Indian goods from August 1, with extra penalties threatened over Russian oil imports; rupee and Gift Nifty futures fell.3
• Indian state refiners paused spot Russian crude purchases amid narrowing discounts and US tariff threats, shifting to Middle Eastern and West African oil.8
• US and South Korea reached a trade deal: 15% tariff on Korean goods (down from 25%), $350B Korean investment, and $100B in US energy purchases.4
• Trump ended the global duty-free “de minimis” exemption for low-value imports from August 29, impacting e-commerce and logistics costs.6
• US Treasury announced its largest Iran-related sanctions package since 2018, targeting over 115 entities and vessels, including several Indian firms.79
• BOJ held policy rate at 0.5% and raised inflation forecasts, supporting the yen and pushing up JGB yields.5
• Microsoft and Meta beat earnings estimates on AI-driven growth, signaling higher capex; shares surged in after-hours trading.15
• UK regulator accused Microsoft and Amazon of stifling cloud competition, recommending a market investigation.14
• China’s polysilicon makers plan a $7B fund to close surplus capacity and stabilize solar material prices.13
• US set a 15% tariff on EU wine and spirits from August 1, increasing trade friction with Europe.17

Commentary

US trade policy is driving volatility across commodities, currencies, and equities. The copper tariff, while narrower than previously proposed, led to a sharp correction in futures and pressure on US producers, while sparing major exporters of refined copper like Chile and Peru.2 The 25% tariff on Indian goods, combined with threats of further penalties over Russian oil, has weakened the rupee and Indian equity futures, and prompted Indian state refiners to pause Russian crude purchases—potentially tightening supply for global oil markets and shifting flows toward Middle Eastern and African grades.38

The US-South Korea trade agreement, with a reduced 15% tariff and a $350B Korean investment commitment, removes near-term uncertainty for Korean exporters and secures significant US energy exports.4 Meanwhile, the end of the “de minimis” exemption will raise compliance costs for e-commerce and logistics firms, particularly ahead of the peak holiday season, and could affect consumer imports and retail margins.6

In tech, China’s scrutiny of Nvidia ’s H20 chips adds uncertainty for US semiconductor exports to China,1 while Microsoft and Meta ’s strong earnings underscore the ongoing AI-driven rally in US mega-cap tech.15 However, the UK’s competition probe into Microsoft and Amazon ’s cloud operations introduces fresh regulatory risk for the sector.14 China’s move to cut polysilicon capacity aims to stabilize solar input prices after a period of oversupply and price declines, which could support global solar equities.13

The BOJ’s decision to hold rates but upgrade inflation forecasts has strengthened the yen and nudged JGB yields higher, with traders now watching for potential tightening later this year.5 On the geopolitical front, the US’s largest Iran sanctions package since 2018, including actions against Indian firms, signals a tougher stance on energy flows and secondary sanctions risk, adding another layer of complexity to global oil and shipping markets.79

TL;DR

Oil surges on Trump’s Russia ultimatum; SEC greenlights in-kind crypto ETFs; China resumes rare earth exports.

Highlights

• Oil prices jumped 3.5%+ as Trump issued a 10-day ultimatum to Russia over Ukraine, threatening tariffs and secondary sanctions on buyers of Russian crude; China specifically warned14.
• SEC approved in-kind creation/redemption for all US spot Bitcoin and Ether ETFs, expected to improve liquidity and lower costs; position limits on Bitcoin options raised2.
• China agreed to resume rare earth magnet shipments to the US after trade talks; US and China are discussing a possible tariff pause and a Trump-Xi meeting320.
• Tesla signed a $4.3B deal with LG Energy for US-made batteries, reducing reliance on China and avoiding 145% tariffs on Chinese imports5.
• Mexico raised import duties to 33.5% on small parcels from non-trade partners (notably China), aiming to preempt US tariffs and curb Chinese e-commerce flows9.
• US Treasury warned China of steep tariffs for buying sanctioned Russian oil; $600B EU investment deal tied to tariff flexibility, with further US pressure on China possible48.
• Australia’s Q2 core inflation slowed to 2.7%, pushing bond yields lower and raising RBA rate cut expectations13.
• Eurozone Q2 GDP rose 0.1% as France and Spain outperformed Germany and Italy; ECB rate cut odds remain near 50% for December14.
• Chile’s central bank cut rates to 4.75%, resuming easing as inflation falls and labor market weakens12.
• Palo Alto Networks is in advanced talks to acquire CyberArk for over $20B; CyberArk shares surged, Palo Alto fell6.
• Kraken is seeking $500M funding at a $15B valuation, signaling crypto sector optimism and possible IPO plans17.
• 8.8-magnitude earthquake off Kamchatka triggered Pacific tsunami warnings; limited immediate market impact, but supply chain risks noted16.

Commentary

Energy markets are reacting sharply to renewed geopolitical risk, with oil prices rallying on the back of Trump’s ultimatum to Russia and threats of secondary sanctions targeting buyers of Russian crude, including China14. This adds near-term upside risk for oil and could pressure energy-importing economies, especially if OPEC+ signals further supply restraint in August. Watch for volatility in oil-linked equities and currencies.

US-China trade dynamics remain fluid. China’s agreement to resume rare earth magnet shipments and ongoing talks about a tariff pause are positive for supply chains320, but tensions persist as the US warns of steep tariffs on Chinese purchases of sanctioned Russian oil4. Mexico’s tariff hike on Chinese e-commerce parcels9 and Tesla ’s battery sourcing shift to the US5 further highlight the trend toward supply chain localization and trade protectionism, likely supporting North American manufacturing and weighing on some Chinese exporters.

Central banks are tilting dovish. Australia’s softer inflation13 and Chile’s rate cut12 reinforce a global easing bias, while the ECB remains cautious as Eurozone growth stays sluggish14. Expect downward pressure on AUD and CLP , and continued focus on ECB guidance for the euro .

In digital assets, the SEC’s approval of in-kind ETF flows for Bitcoin and Ether should deepen liquidity and attract more institutional capital2. Kraken’s fundraising and IPO plans17 further signal sector momentum. Watch for tighter ETF spreads and increased crypto trading volumes.

The Kamchatka earthquake is a reminder of supply chain vulnerability in the Asia-Pacific, but immediate financial market impact appears limited16. Traders should stay alert to headline risk from ongoing US-China negotiations, energy sanctions, and central bank decisions.

TL;DR

US-EU clinch tariff/energy/AI chip deals; oil up on Russia deadline; euro, rouble weaken.

Highlights

• US and EU agree to 15% tariffs on most European goods (down from 30% threat)1; 50% US tariffs on EU steel/aluminum remain1; euro drops 1%, European stocks rally1.
• EU commits to $750B in US energy imports3 and €40B ($46B) in US AI chips through 20286, boosting US export outlook.
• Oil rises 2% after Trump cuts Russia’s Ukraine ceasefire deadline to 10–12 days, threatens 100% tariffs and new sanctions47; rouble down 2% vs USD4.
• Russia extends gasoline export ban through August 31, tightening refined product supply11.
• US and China resume tariff talks in Stockholm; no breakthrough, but negotiations continue2.
• Senate Democrats urge Commerce to maintain AI chip export ban to China5; Nvidia orders 300K more H20 chips from TSMC amid Chinese demand8.
• Apple to close first mainland China store as iPhone sales slump10; India surpasses China as top US smartphone supplier17.
• Cadence Design Systems pleads guilty to illegal China tech sales, pays $140M fine; shares up 7.8%9.
• UBS restricts sales of complex FX derivatives after client losses tied to post-tariff dollar volatility13.
• Japan’s 2-year bond auction sees strongest demand since 2024 as yields hit 16-year highs18.
• ECB warns dollar stablecoins threaten euro monetary autonomy12; Interactive Brokers considers launching stablecoin for 24/7 client funding16.
• Coinbase in advanced talks to acquire India’s CoinDCX for under $1B, signaling further crypto market consolidation19.
• EU suspends Ukraine aid over anti-corruption reform delays, freezing payments from Russian asset income20.

Commentary

The US-EU trade agreement removes the immediate risk of a transatlantic trade war, supporting European equities and strengthening the US dollar as the euro slides1. The deal’s 15% tariffs are less severe than initially threatened, but still higher than the EU’s average, and steel/aluminum duties remain elevated1. The EU’s massive commitments to US energy3 and AI chip imports6 signal a structural shift in transatlantic trade, with clear upside for US exporters in energy and semiconductors.

Energy markets are reacting to both geopolitics and supply constraints. Oil prices climbed after Trump shortened Russia’s Ukraine ceasefire deadline and threatened sweeping new sanctions47, while Russia’s extension of its gasoline export ban further tightens refined product supply11. These developments support US energy equities and exporters37, while keeping the rouble under pressure4.

In tech, US-China tensions persist. Senate Democrats are pushing to keep AI chip export bans in place5, even as Nvidia faces strong Chinese demand and supply shortfalls, leading to new orders from TSMC 8. The EU’s $46B AI chip order is a tailwind for US chipmakers6, but Apple ’s China store closure10 and the surge in Indian smartphone exports to the US17 highlight ongoing supply chain realignments and China’s weakening position in global tech hardware.

Elsewhere, Japan’s robust 2-year bond auction reflects rising yields and expectations for Bank of Japan policy normalization18. UBS’s move to restrict complex FX derivatives follows client losses from dollar volatility post-tariff announcements13, underscoring the need for risk controls in turbulent currency markets. In digital assets, the ECB’s warning on dollar stablecoins12 and Interactive Brokers’ stablecoin plans16 point to growing regulatory focus and the integration of crypto with traditional finance. Coinbase ’s potential CoinDCX acquisition shows continued consolidation in India’s crypto sector19. The EU’s suspension of Ukraine aid over anti-corruption delays adds another layer of uncertainty to the region20.

TL;DR

US-EU cap tariffs at 15%; US-China extend tariff truce; US copper, chip tariffs loom.

Highlights

• US-EU trade deal caps most tariffs at 15%, averting a 30% hike; EU commits to $750B in US energy buys and major US military equipment purchases1.
• US and China extend tariff truce by 90 days; US pauses new tech export controls during ongoing talks23.
• US Commerce to release results of semiconductor import probe in two weeks; potential tariffs for AMD , Intel , Nvidia , others8.
• Japan seeks ¥60–70 trillion ($380–440B) in new JGB buyers as BOJ reduces bond purchases, raising focus on market demand and yen stability4.
• US to impose 50% tariff on copper imports this week; market awaits details on coverage and exemptions15.
• Samsung wins $16.5B contract to produce Tesla AI chips, boosting shares; underscores US push for domestic AI chip capacity5.
• CK Hutchison seeks Chinese partner (potentially COSCO) for $23B global ports sale; regulatory and geopolitical scrutiny rises6.
• EU opens foreign-subsidy probe into ADNOC’s €12B Covestro bid, potentially delaying deal completion7.
• Binance launches RWUSD, a principal-protected yield product linked to tokenized US Treasuries, offering up to 4.2% APY (not available to US users)18.
• GSK licenses COPD drug and pipeline from China’s Hengrui for $500M upfront, with potential payments up to $12B; Hengrui shares surge11.
• France criticizes EU-US tariff pact as unbalanced, signaling possible further negotiations on digital and protected sectors16.
• Israel threatens severe military action in Gaza if Hamas does not release hostages, raising regional risk12.

Commentary

The US-EU trade agreement delivers near-term relief for global markets, with a 15% tariff cap averting a steeper escalation and providing clarity for key sectors such as autos, semiconductors, and pharmaceuticals1. The EU’s commitment to large-scale US energy and military purchases is supportive for US exporters and risk assets, but French criticism highlights that further negotiation—especially around digital services and sector carve-outs—remains likely16. European equities and the euro have responded positively, but the deal’s durability is still in question116.

US-China trade tensions are contained for now, with a 90-day extension of the tariff truce and a pause on new US tech export controls23. However, the upcoming US semiconductor import probe could introduce fresh volatility for chipmakers and supply chains, particularly if tariffs are levied on leading firms such as AMD , Intel , and Nvidia 8. The imminent 50% tariff on copper imports adds to commodity market uncertainty, with traders watching for details on exemptions and potential supply disruptions15.

Japan’s need to attract substantial new JGB buyers as the BOJ reduces bond purchases will test market appetite and yen stability. Any signs of weak demand could impact global rates and FX markets4. In corporate news, Samsung’s $16.5B chip contract with Tesla secures long-term foundry business and reinforces the US trend toward domestic AI chip production5. Meanwhile, CK Hutchison’s port sale negotiations with a possible Chinese state partner and the EU’s probe into ADNOC’s Covestro bid both underscore rising regulatory and geopolitical scrutiny in cross-border deals67.

Elsewhere, Binance’s RWUSD launch highlights ongoing efforts to link crypto with traditional fixed income, though regulatory barriers remain18. GSK ’s licensing deal with Hengrui expands its pipeline and signals continued cross-border pharma activity11. In geopolitics, Israel’s threat of escalation in Gaza and ongoing regional tensions add a layer of headline risk for energy and defense markets12.

TL;DR

US-EU/Canada/Brazil tariff risks rise; BRICS to curb dollar use; record Ethereum ETF inflows.

Highlights

• China says BRICS will soon introduce measures to reduce dollar reliance in trade and finance; details pending 1.
• US finalizes trade pact with UK, but EU talks stall with 30% US tariff threat for August 1; Canada faces possible 35% US tariff, Brazil 50% 465.
• Japan disputes US claim to 90% of profits in $550B trade pact, raising uncertainty for related deals 7.
• Argentina cuts export taxes on soy, grains, and meat, aiming to boost competitiveness; cuts called permanent 9.
• Chinese lithium futures hit five-month highs after NDRC reviews pricing rules, lifting global lithium stocks 10.
• Intel may exit advanced chip manufacturing if it cannot secure major 14A node customers; restructuring and possible Apple partnership underway 13.
• China proposes global AI governance body as $1B in Nvidia chips reach China despite US curbs; Huawei unveils new high-performance AI system 14.
• Galaxy Digital handles $9B Bitcoin sale with limited market impact 15; US spot Ethereum ETFs attract $2.4B in net inflows, outpacing Bitcoin 16.
• Moody’s upgrades Turkey to Ba3 on improved policy credibility; Fitch raises Hess to AA, maintains Serbia and Saudi ratings 17.
• Russian Central Bank cuts key rate by 200bps to 18% as inflation hits 4%, but recession risks persist 11.
• Puma shares drop nearly 20% after profit warning and sales downgrade, citing high inventories 18.
• Israel opens humanitarian corridors and resumes Gaza aid airdrops under pressure; full aid access remains limited 2.

Commentary

Trade policy remains a central risk for global markets. The US-UK trade deal provides some clarity for cross-Atlantic flows 4, but unresolved negotiations with the EU, Canada, and Brazil mean significant tariff hikes could take effect as soon as August 1 465. This uncertainty is likely to weigh on equities in autos, agriculture, and manufacturing, particularly for firms exposed to transatlantic and North American supply chains. Japan’s dispute over profit allocation in its US trade pact adds further complexity for cross-border investment planning 7.

Emerging market news is mixed. Argentina’s permanent export tax cuts should support its agricultural sector and may pressure global soy and meat prices 9. Turkey’s credit upgrade reflects improved monetary policy 17, while Russia’s aggressive rate cut highlights ongoing economic stress despite inflation progress 11. The BRICS announcement on reducing dollar reliance is notable, but the lack of specifics limits immediate market impact 1; traders should watch for concrete steps.

In commodities and tech, Chinese lithium futures rallied on expectations of tighter domestic controls, supporting global lithium equities 10. Intel ’s warning about its advanced chip business underscores ongoing challenges in the semiconductor sector, with restructuring and possible partnerships signaling industry shifts 13. China’s push for global AI governance and evidence of continued Nvidia chip flows despite US export controls highlight ongoing tech competition and supply chain workarounds 14.

Crypto markets remain resilient, with a $9B Bitcoin sale absorbed smoothly 15 and Ethereum ETFs seeing record inflows, signaling robust institutional demand and potential rotation in digital asset leadership 16. In equities, Puma’s sharp decline on weak guidance may prompt broader scrutiny of consumer discretionary names 18. Geopolitical developments in the Middle East and humanitarian efforts in Gaza remain on watch, but direct market impact is limited unless the situation escalates 2.

TL;DR

France to recognize Palestine; Russia bans gasoline exports; ECB pauses cuts; VW, Puma warn on tariffs.

Highlights

• France will recognize the State of Palestine at the UN in September, the first G7 nation to do so; UK and Germany to discuss coordinated action as Gaza cease-fire talks stall1.
• Israel and the US pulled negotiating teams from Doha after Hamas’s latest cease-fire proposal, citing lack of progress; humanitarian and security concerns persist2.
• Russia to ban most gasoline exports in August–September to cap domestic prices; export volumes to key buyers like Egypt and Turkey will be affected3.
• Chevron resumes Venezuelan oil production with US approval, adding 200,000 barrels/day to US supply; no royalties or taxes to Maduro’s regime4.
• ECB pauses rate cuts, keeps deposit rate at 2% citing inflation near target but flags external risks, especially trade disputes and euro strength5.
• Bank of Russia cuts policy rate by 200 bps to 18% as inflation cools, but maintains cautious outlook6.
• US and Japan to launch a $550B sovereign wealth fund for US assets with 90% profit share to the US; Trump to oversee investments7.
• India and UK sign FTA, expected to boost annual trade by £25.5B, with phased tariff cuts on autos and alcohol8.
• Volkswagen cuts 2025 outlook after €1.3B US tariff hit; Puma warns of 2025 loss, shares fall 20%, both citing weak demand and tariff impacts1011.
• Intel to cut 15% of staff, cancels German/Polish fabs after $1.9B restructuring charge; future expansion tied to demand9.
• China offers to increase EU imports if tech export curbs are eased; Shanghai AI conference draws 800 firms despite US chip sanctions1216.
• Bitcoin drops to $115,000 on Galaxy Digital outflows; Ethereum ETFs reach $16.6B AUM as institutional flows shift1819.

Commentary

Geopolitics and trade remain front and center for global markets. France’s planned recognition of Palestine1, combined with the breakdown in Gaza cease-fire talks2, adds complexity to Middle East risk calculations. While direct market impact is limited for now, energy markets remain sensitive to escalation or supply disruptions in the region. The withdrawal of US and Israeli teams from Doha further reduces near-term prospects for de-escalation2.

On the commodity front, Russia’s gasoline export ban for August–September is likely to tighten refined product markets, particularly in countries reliant on Russian supply such as Egypt and Turkey3. However, the resumption of Chevron ’s Venezuelan oil production—without financial benefit to the Maduro regime—should help offset some supply concerns for US refiners4. Watch for volatility in oil and gasoline prices as traders assess the net effect of these moves.

Central banks are signaling a more cautious approach. The ECB paused after seven consecutive rate cuts, citing inflation near target but highlighting risks from trade disputes and euro appreciation5. The Bank of Russia’s 200 bps rate cut reflects easing inflation but policymakers remain wary of renewed price pressures6. Meanwhile, the US-Japan $550B sovereign wealth fund agreement removes a key uncertainty for the Bank of Japan, potentially supporting further rate hikes if growth and inflation hold up717.

Trade tensions and tariffs are weighing on corporate outlooks. Volkswagen and Puma both downgraded guidance, citing US tariffs and weak demand1011, while Intel ’s restructuring and fab cancellations underscore a shift to more disciplined capital allocation amid uncertain demand9. The India-UK FTA is a rare positive, with significant tariff reductions expected to boost bilateral trade, particularly in autos and alcohol8.

In digital assets, Bitcoin fell on large Galaxy Digital wallet outflows18, while Ethereum ETFs continue to attract institutional inflows, pushing AUM to $16.6B19. The rotation from Bitcoin to Ether is notable and could drive further volatility in crypto markets. China’s offer to expand EU imports if tech curbs are lifted12, and its large AI conference despite US sanctions16, signal continued tech sector maneuvering.

TL;DR

U.S. nears 15% tariff deals with EU/Japan; SK Hynix, Nikkei, S&P 500 hit records; China lithium surges.

Highlights

• Trump threatens 15–50% tariffs on countries without U.S. trade deals by Aug. 1; only a few countries have secured agreements so far 1.
• U.S. and EU near a 15% tariff deal with exemptions for aircraft, spirits, and medical devices; European auto tariffs to be cut 2.
• Trump announces $550B Japan trade pact, lowering auto tariffs and prompting record highs in Nikkei and S&P 500 3.
• ECB holds deposit rate at 2%, pausing its easing cycle as trade uncertainty persists; markets still price in one more cut 7.
• EU prepares €93B in retaliatory tariffs on U.S. goods if no deal is reached; measures could start as soon as Aug. 7 8.
• U.S. to lift Nvidia H20 export curbs in exchange for Chinese rare-earth magnets; $1B in Nvidia chips reportedly circumvented U.S. export restrictions to China 45.
• SK Hynix posts record profit on AI memory demand; South Korea’s Q2 GDP beats forecasts on strong semiconductor exports 1317.
• China’s lithium futures hit five-month highs on rumors of production suspensions and draft price law tightening 11.
• Honda delays hydrogen plant; Fortescue cancels green hydrogen projects, reflecting weaker global hydrogen demand and high costs 12.
• Tether plans U.S. re-entry as new stablecoin law takes effect, targeting institutional payments 15.
• Thailand-Cambodia border clashes escalate, causing evacuations and diplomatic downgrades; regional risk rises 9.
• China-EU summit ends without breakthroughs amid trade deficit, EV subsidy, and rare-earth tensions 6.

Commentary

Trade policy remains the primary market driver as the U.S. sets an Aug. 1 deadline for new tariffs on nations without bilateral deals 1. The U.S.-Japan agreement and progress with the EU have eased some market concerns, with equity indices in Japan, Europe, and the U.S. rallying on expectations of lower tariffs than initially feared 23. However, the risk of last-minute breakdowns or escalation persists, with the EU preparing significant retaliatory measures 8 and the ECB pausing its easing cycle to assess the fallout 7.

In Asia, strong semiconductor demand is supporting both corporate earnings and macro data. SK Hynix’s record profit and South Korea’s better-than-expected Q2 GDP highlight the sector’s momentum 1317, though ongoing U.S.-China tech tensions—evidenced by both the chips-for-magnets swap and reports of Nvidia chips reaching China despite curbs—keep supply chain risks elevated 45. Meanwhile, China’s lithium futures surged on supply rumors and draft regulatory changes, reinforcing commodity price volatility 11.

The energy transition narrative is under pressure as Honda delays its hydrogen plant and Fortescue cancels projects, reflecting persistent cost and demand challenges for green hydrogen 12. This suggests continued reliance on traditional energy sources in the near term.

Crypto markets may see increased institutional activity as Tether prepares to re-enter the U.S. under new regulatory clarity 15. Regional risk is also in focus with escalating Thailand-Cambodia border tensions 9 and a lack of progress in China-EU trade talks 6, both of which could affect sentiment in EM and regional assets.

TL;DR

U.S.-Japan 15% tariff deal lifts Nikkei; ADB cuts Asia growth; gold, Bitcoin hit records on trade risks.

Highlights

• U.S. and Japan agree to a 15% reciprocal tariff (down from 25%), boosting Nikkei and Japanese automakers1.
• U.S. finalizes 19% tariffs on Indonesian and Philippine exports, with broad U.S. market access in return1112.
• European auto stocks rally 4.2% on hopes for similar U.S.-EU tariff reductions14.
• Asian Development Bank cuts 2025 developing Asia growth forecast to 4.7% on U.S. tariffs and China property weakness3.
• Japan PM Ishiba expected to resign by end of August; Japan’s 40-year bond auction sees weakest demand since 2011213.
• China and U.S. set July 27–30 trade talks in Sweden to address tariffs and market access4.
• gold rises above $3,415/oz and Bitcoin tops $120,000 as haven demand increases amid trade tensions and lower yields89.
• Amazon and McKinsey scale back China AI operations; AWS closes Shanghai AI lab, following IBM and Microsoft moves618.
• Chinese hackers exploit Microsoft SharePoint flaw, breaching U.S. agencies and firms; Microsoft faces renewed security scrutiny5.
• Mexico plans $7–10 billion sovereign bond sale to support Pemex, lifting Pemex bonds7.
• Apple set to win EU approval for App Store fee overhaul; UK regulator proposes “strategic market status” for Apple and Google 1516.
• Vale beats Q2 iron ore output forecast, but sales lag and prices soften; nickel and copper output rise19.

Commentary

Traders are focused on a series of U.S.-driven bilateral trade deals ahead of the August 1 tariff deadline. The U.S.-Japan agreement, with a lower-than-expected 15% tariff, triggered a sharp rally in Japanese equities and automakers, and fueled optimism in European auto stocks that similar tariff relief may be forthcoming114. The U.S. also secured new trade terms with Indonesia and the Philippines, locking in 19% tariffs but gaining substantial market access for U.S. goods1112. These deals are part of a broader U.S. effort to reset trade terms across Asia, but the Asian Development Bank’s growth downgrade signals that persistent tariffs and China’s property market weakness continue to weigh on regional prospects3.

Japanese political uncertainty is back in focus, with PM Ishiba reportedly preparing to resign and the 40-year bond auction drawing the weakest demand in over a decade. This has implications for Japanese government bond yields and may add volatility to JGBs and the yen, especially as fiscal and leadership questions mount213.

Safe-haven flows remain pronounced. gold and Bitcoin are both near record highs, supported by trade friction, lower Treasury yields, and a cautious Fed outlook89. The U.S. 10-year yield has fallen to a two-week low, and traders will be watching next week’s Fed meeting and the upcoming U.S.-China trade talks in Sweden for further direction48.

Tech and cybersecurity risks are increasingly relevant. U.S. tech and consulting firms are reducing China AI exposure, with AWS shuttering its Shanghai lab and McKinsey restricting AI work, reflecting deepening U.S.-China tech decoupling618. Separately, a major Microsoft SharePoint vulnerability exploited by Chinese hackers has heightened scrutiny of software supply chains and may impact sentiment toward U.S. tech names5.

In commodities, Vale ’s iron ore production exceeded forecasts, but weaker sales and prices highlight soft global steel demand19. Mexico’s planned sovereign bond sale to support Pemex has been well received, easing near-term default risk for the state oil company7. Meanwhile, Apple is set to clear a key regulatory hurdle in the EU, but faces new scrutiny in the UK as regulators move to tighten oversight of digital platforms1516.