📉 Market Report.
🗣️ Remember three months ago, on 9 April, when Trump told the press that some countries were “kissing his ass” and “dying to make a deal”. Well, so far, the agreements reached have been minimal. It does not appear that the ‘liberation day’ strategy is working.
📊 Tariffs have pushed U.S. tax rates to post-World War II highs, according to Tim Seymour, CIO of Seymour Asset Management. The Tax Foundation reports that the weighted average applied tariff rate on all imports would rise to 16.0 percent, and the average effective tariff rate would rise to 12.3 percent under the current tariffs – the highest average rate since 1941.
⚠️ Yesterday, Trump says any country aligned with BRICS’ “Anti-American policies” will face an extra 10% tariff.
🌍 At least 14 countries’ imports are set to face steep blanket tariffs starting August 1, as revealed by President Trump. The tariff rates range from 25% on goods from Japan, South Korea, Malaysia, Kazakhstan, and Tunisia, to 40% on imports from Laos and Myanmar.
📜 The tariff letters state that the U.S. may consider adjusting the rates depending on the country’s relationship with the U.S. The U.S. has only announced broad trade frameworks with the UK, Vietnam, and a preliminary agreement with China since the April tariff pause.
🇪🇺 For the EU, tariffs on nearly all its exports to the U.S. will jump to 50% on that date if it doesn’t strike a deal beforehand.
🚗 The EU is close to an agreement with the Trump administration that could involve limited concessions to the U.S. baseline tariffs of 10% for aircraft, parts, some medical equipment, and spirits. The EU is also looking into an arrangement that would allow EU automakers producing and exporting cars from the U.S. to import more EU vehicles at tariff rates below the current 25%. This potential arrangement would benefit German carmakers with large U.S. plants. The EU currently faces 50% U.S. tariffs on its steel and aluminum exports, 25% on cars and car parts, and 10% on most other products.
🤝 Member states are divided on how imbalanced a deal the EU should accept, with some pushing for a quick agreement while others want the EU to impose countermeasures and negotiate from a position of strength.
📱 One of the points that Trump declared to be problematic for relations with the EU remains active: the ‘attack on American technology companies’.
💻 Apple Inc. has appealed a €500 million ($580 million) fine from the European Union, calling the penalty “unprecedented” and the regulator’s required changes to its App Store as “unlawful.” The European Commission imposed the fine in April under its Digital Markets Act, saying Apple ran afoul of rules related to allowing developers to steer users to make purchases outside of its store. Apple claims the regulators’ demanded changes are more confusing for both users and developers, and that no other app download store is subject to such a structure.
🏦 Over recent years, the EU has issued costly penalties against firms, including more than $8 billion in fines against Alphabet Inc.’s Google and a separate order for Apple to pay Ireland back taxes of €13 billion. Apple maintains that the European Commission’s decision and fine go “far beyond what the law requires” and is appealing the decision.
🌐 Geopolitics:
⚡ Little by little, Trump’s campaign promises and his foreign policy stance seem to be dissolving and becoming just another piece of what he called the “deep state”.
🗂️ During the campaign, Elon Musk said that Trump had to be elected so that Epstein’s client list would finally be made public. Two days ago, Trump’s DOJ and FBI conclude Epstein had no “client list” and committed suicide.
🛡️ Trump assured that they will send more weapons to Ukraine, despite promising to end the war. He clarified, however, that they will be defensive weapons.
❌ U.S. State Department officially removes al-Nusrah Front from its list of foreign terrorist organizations.
🏅 On the other hand, Netanyahu has nominated Trump for the Nobel Peace Prize after getting him to intervene militarily against Iran, despite the discontent of many of his media allies and his own vice president.
📞 JD Vence reportedly assured Netanyahu in a phone call that Israel was dragging the US into war. Just before Trump’s decision to bomb Iran.
📈 Market View:
📉 The US markets have retreated in light of the fact that Trump’s tariffs are set to come back into effect soon. The S&P 500 futures, which were trading above 6,300 points yesterday, have declined and are currently trading at 6,284 points, attempting to recover. The Dow futures, which experienced a decline from 23,000 points, remain close to these highs, currently trading at 22,945 points.
📊 Those who have benefited from the recent announcements regarding tariffs are the European markets. The fact that Europe has been spared from a new round of tariffs has triggered euphoria in the stock exchanges. DAX 40 futures are advancing confidently, currently surpassing 24,180 points, while Eurostoxx 50 futures are rising firmly, exceeding 5,350 points.
💵 On the other hand, the dollar has continued to strengthen, with the DXY index surpassing 97.50 points yesterday before retreating to its current level of 97.35 points. This has caused pairs that were extremely bullish, such as EUR/USD, to briefly lose the 1.17 level. However, it has since recovered and is currently trading at 1.1735.
🛢️ The crude oil market has managed to rally despite warnings from OPEC+ about production cuts. The WTI barrel surpassed $68 in recent hours and is currently trading at $67.65.
🥇 Gold futures fell during yesterday’s session to approximately $3,300 before rebounding upwards from those levels. They are currently trading at $3,345.
💻 Bitcoin, which exceeded $109,000 during yesterday’s session, has retreated to its current level of $108,185.
