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Tech Drives Records as Tariffs and Trump’s Big Bill Shape the Outlook

  • Writer: Joshua Dawe
    Joshua Dawe
  • Jul 5
  • 3 min read

Updated: Jul 17

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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.




  • Tech Titans Lift S&P 500 to New Record: The S&P 500 has soared 25% from its April low, reaching new highs driven by tech giants like Nvidia, nearing a $4 trillion valuation, and Oracle, which secured a landmark $30 billion cloud deal likely with OpenAI. Even Nike's stock jumped 15%, signaling investor optimism around its comeback efforts.

  • Tariff Troubles Loom Despite Market Rally: Markets face uncertainty as Trump's administration threatens fresh tariffs set for July 9th, targeting countries like India, Japan, and Vietnam, despite recent trade agreements. Canada has already backed down on a digital-services tax aimed at big U.S. tech firms after threats from the White House, highlighting continued trade tensions optimism.

  • Dollar Finds Temporary Relief Amid Tax Bill Impact: The U.S. dollar edged slightly upward after sinking to its lowest in three years, marking its worst first-half performance since 1973 with an 11% drop. Investors remain wary, carefully weighing the economic implications of Trump's ambitious tax cuts and increased spending.

  • Trump's Massive Tax Bill Narrowly Clears Senate: The Senate narrowly approved Trump's controversial bill, which includes significant tax cuts, substantial funding for border security, and deep reductions in welfare and clean-energy spending. Passed by a tight 51-50 margin, with Vice-President J.D. Vance casting the decisive vote, the bill now faces skepticism in the House due to its projected addition of $3.4 trillion to the deficit over the coming decade.




  • Previous Week: China's NBS Manufacturing PMI matched market expectations at 49.7, signaling continued contraction. EU inflation aligned with forecasts at 2%, while the U.S. unemployment rate surprised positively, dropping to 4.1%, beating expectations.

  • This Week: Keep an eye on China's inflation figures, the release of the latest FOMC minutes, and Canada's unemployment rate, which currently sits notably high at 7%, the highest among the countries I track.

  • Other Events: Tariffs kick in July 9th, and earnings season starts late July — big tech will be the main focus.



Market Movement


  • Equities: Most major indices ended the week positively, gaining over 1% WoW, though Eurostoxx50 and Japan’s Nikkei bucked the trend, dipping slightly.

  • Rates: SG 10-Year yields made a sharp move down, dropping around 6% WoW and approaching levels similar to China and Japan. Conversely, yields in the US, Canada, and the UK climbed higher.

  • Forex: Currency markets were mixed. The Euro strengthened, while the Pound slipped lower following welfare reform developments in the UK.

  • Commodities: Strong week across the board, with Low Sulphur Gasoil notably surging by 10%, likely influenced by intensified Russian attacks in Ukraine.

  • Crypto: Crypto markets remained relatively quiet, with top tokens and altcoins trading flat, fluctuating between mild gains of around 1% and modest losses near 3%.



Watchlist


  • Fed Fund Futures: Traders are pricing in three rate cuts by year-end, a big shift that’ll need watching as data rolls in. Any surprises in inflation or growth could upend this dovish view.

  • SP500 Index: Rallied 2.4% WoW, touching new all-time highs with big tech fueling the momentum, Nvidia leading the pack. Volatility remains subdued, with the VIX steady around 16.

  • US10Y Yield: Yields rose approximately 2%, ending at 4.35%. Both 2-year and 10-year yields moved in tandem, while narrowing credit spreads indicated diminishing concerns about potential defaults.

  • Dollar Index: Remained fairly steady WoW. Futures positioning shows increased bearish bets on the dollar, particularly from Euro longs and short-covering in CAD and JPY.

  • USDJPY: Held steady for the week. Yield differentials remained stable near 3% after a recent downward trend. Notably, fund managers are trimming their bullish bets and adding bearish positions, suggesting increased caution going forward.

  • USDSGD: Flat for the week, but technical indicators signal oversold conditions, and seasonality is notably weak. Additionally, the linear regression against the Dollar Index appears heavily misaligned, suggesting the Singapore dollar may currently be too strong relative to its currency basket. This raises the question: at what point will the MAS step in to adjust this exceptionally strong SGD? Something to keep on the radar.




 
 
 

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