Fairways & Free Trade: Trump Cuts a Deal with the EU
- Joshua Dawe
- Jul 28
- 3 min read
Welcome to this week's market rundown. I’m covering key news, what’s on the economic calendar, how markets have been moving, and what trades I’m tracking right now. Whether you’re trading or just keeping score, here’s what you need to know to stay one step ahead.
Trump Tees Up a Tariff Truce: Donald Trump struck a deal with the EU to sidestep a tariff war, cutting his threatened duties in half and scoring European pledges to buy American energy and weapons. The agreement, reached at his Scottish golf resort after a meeting with Ursula von der Leyen, the president of the European Commission, was part golf diplomacy, part geopolitical maneuvering.
Global Outcry Over Gaza: Nearly 30 countries urged Israel to halt its war in Gaza, warning of mass starvation and demanding more aid access. With the humanitarian crisis deepening and civilian suffering “reaching new depths,” the international coalition called for Israel to stop “drip feeding” aid. Israel dismissed the call as “disconnected from reality,” even as ceasefire talks continued in Qatar.
Talks in Turkey, Hope on Ice: New peace talks in Istanbul were set in motion after Trump warned Russia of looming sanctions if it didn’t move toward a deal. Despite the diplomatic buzz and Zelensky’s push for negotiations, the Kremlin made it clear not to expect miracles, throwing cold water on hopes of a breakthrough.
AI Gets a Trump Makeover: Trump unveiled a plan to loosen AI rules across the US, aiming to boost exports and rein in what he calls “woke Marxist lunacy” in machine learning. His initiative targets the patchwork of state regulations and includes penalties for states with stricter rules, all part of a push to unify and amplify America’s AI power globally.
Powell in the Firing Line: Trump called Fed Chair Jerome Powell a “numbskull” and hinted his days are numbered, escalating his public war against the central bank for not slashing interest rates fast enough. Treasury Secretary Scott Bessent added fuel to the fire, accusing the Fed of “mission creep” and demanding a full review of its non-monetary activities.
Calendar
Previous Week: The ECB held its interest rate steady at 2.15%, the week's biggest headline.
This Coming Week: Packed macro week: GDP data from France, Germany, Italy, and the US, Fed rate decision, inflation prints from Japan and Europe, and US unemployment figures.
Previous Week: Alphabet beat earnings expectations.
This Coming Week: Big names reporting this week include Microsoft, Meta, Amazon, Apple, Exxon, and Chevron.
Tariffs: August 1st deadline.
Market Movement
Equities: Nikkei (+4%) led global indices, with CSI 300, Straits Times, and UK 100 all up over 2%. ASX 200 and Euro Stoxx dipped slightly.
Rates: Japan and China 10Y yields jumped WoW, while US, UK, and Canada yields edged down.
Forex: AUD, EUR, and GBP gained against the dollar. USDJPY and the Dollar Index weakened.
Commodities: Iron Ore rose ~1%. Crude, gasoline, and heating oil fell 1.5–2.5%. Gold slightly down.
Crypto Solana (+5%) and Ethereum (+3%) were weekly standouts. Bitcoin flat. XRP slipped.
Watchlist
Fed Fund Futures: Traders still pricing in three rate cuts by year-end.
SP500 Index: Up 1.5% WoW, pushing fresh all-time highs. Nvidia and Big Tech remain the backbone. VIX keeps dropping, showing no fear. Watch for big earnings this week.
US10Y Yield: Down 1% WoW, stuck in a wait-and-see mode ahead of key macro data. Credit spreads remain tight, pointing to healthy credit markets.
Dollar Index: Down 0.8% WoW. Still oversold, and short positioning looks crowded, especially vs JPY. Dollar looks undervalued relative to rates.
USDJPY: Fell 0.8% WoW, bouncing off the 50-day MA. Positioning shows longs trimming, shorts adding.
USDSGD: Down 0.4% WoW. SGD looks very strong vs the Dollar Index on regression, nearing a 10-year high.
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