- Sentiments in the European, American and Asian markets were very positive as investors reacted to new reports on tariffs.
- Donald Trump announced a trade deal with Japan overnight, with reciprocal tariff rate at 15% (including autos, which were previously facing a planned at 25%). In return, the Japanese are expected to invest an additional $550 billion in the U.S. Japanese Prime Minister Shigeru Ishiba confirmed the terms of the trade agreement, stating that close cooperation with the U.S. will continue.
- Shares of Japanese and European automakers surged in response to the sectoral tariff cut from 25% to 15% in Japan.
- According to a report in the Financial Times, the United States and the European Union are close to reaching an agreement on 15 percent tariffs. The FT reports that Brussels could agree to so-called reciprocal tariffs to avoid the US president's threat to raise tariffs to 30 percent as early as August 1st.
- However, in the event no agreement is reached by August 1st, the EU will still prepare a €93 billion package of retaliatory tariffs, with possible rates of up to 30 percent.
- White House trade adviser Peter Navarro urged caution regarding reports of a US-EU trade deal, advising to "take it with a grain of salt."
- Today, after market close, Alphabet (GOOGL.US), along with Tesla (TSLA.US), will kick off the earnings season for the "Magnificent Seven" companies.
- Existing Home Sales decreased to 3.93 million units, with expectations at 4 million and with the previous reading at 4.03 million. Data showed further problems with home sales related to high mortgage rates
- The Forex market is dominated by Antipodean currencies today. The Swiss franc and the Canadian dollar are performing the worst. Significant sell-offs are also visible in the USD.
- Crude oil inventories unexpectedly fell by 3.17 million barrels. Gasoline inventories fell by 1.7 million barrels, while distillate inventories rose by 2.9 million barrels. However, oil remains under pressure and is down 0.4%.
- NATGAS is retreating 5% following new weather forecasts, which indicate that temperatures could drop significantly in early August, even below normal.
- Cryptocurrencies are posting relatively significant losses today. Bitcoin is down 1.5%, while Ethereum is down nearly 3.3%.
- Recent news indicates that Russia and Ukraine peace talks have started in Instambul today. On the other hand, we need to remember that expectations for constructive talks are rather low and talks are orchestrated by the US president, who increased pressure on Russia recently, threatening with secondary tariffs at the rate of 100%.
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