Daily summary: US-China negotiation progress among top drivers in the market 📌💰

U.S. indices end the day slightly higher, hovering near all-time highs. The US500 and US100 gain 0.25% to 6,055 and 20,007 points respectively. The US2000 rises 0.40% to 2,168 points.

Today’s upward move was driven by two pieces of news released before the cash session opened. The first catalyst was Donald Trump’s announcement of an agreement reached between the U.S. and China after two days of negotiations in London. The second was the publication of the U.S. May CPI data.

As a result, risk appetite increased in the markets, boosting demand for assets such as stocks and cryptocurrencies. At the same time, there was a sell-off in the U.S. dollar.

Trump indicated that the effective tariff rate on China would be 55%, though he did not specify how this figure was calculated — considering the general 10% tariff and the 20% tariff on fentanyl. As part of the agreement, China is said to have agreed to grant full access to its rare earth metals market for U.S. companies.

The U.S. dollar (USD) is one of the weakest G10 currencies today. The USD index (USDIDX) is down 0.50% to 98.500 points. EUR/USD is up 0.62% to 1.1490.

The May CPI report once again came in lower than expected, indicating low price pressure from the new trade restrictions, which were fully in effect in May.

Following the data release, the market is now pricing in two full rate cuts for 2025, with the first still expected in September.

Scott Bessent said he expects an increase in the debt ceiling. He emphasized that the bond market performed well during the April market turmoil, and that U.S. Treasuries remain the safest debt instruments in the world. Bessent expressed confidence that the tax cut bill will pass.

Polish Prime Minister Donald Tusk’s government received a vote of confidence in Parliament, as expected by the market. The Polish złoty strengthened against both the dollar and the euro. The WIG20 recovered losses after the vote.

Crude oil inventories unexpectedly fell by 3.6 million barrels versus expectations of a 0.1 million barrel increase. Meanwhile, gasoline and distillate stocks rose by over 1 million barrels.

Oil prices gained significantly today, despite mixed headlines around a potential nuclear deal. According to Iran, an agreement is near, but Donald Trump remains skeptical. WTI crude is up 3.3% and approaching $67 per barrel.

In the cryptocurrency market, sentiment remains highly positive. Bitcoin is down 0.56% today to $109,600. However, the more important development is that the price is consolidating near all-time highs.

Bitcoin’s dominance over the overall crypto market has fallen to 63.80%, with capital slightly shifting toward Ethereum and other projects. Ethereum is up 1.55% to $2,880. The combined market cap of other altcoins stands at $890 billion, rising 0.05% today.