Market Quick Take – 10 July 2025

Q3-2025 Macro Outlook: Less chaos, and hopefully a bit more clarity

Market drivers and catalysts

• Equities: Nvidia hits $4T; EU trade deal hopes lift DAX/CAC; WPP profit warning
• Volatility: VIX down to 15.9; calm ahead of CPI; ETF flows turn defensive
• Digital assets: BTC record highs; ETH surges; IBIT/ETHA inflows strong
• Fixed Income: US Treasuries bounce on successful auction, with 30-year auction on tap today
• Currencies:  Dollar trading mixed; the BRL tumbles on Trump tariff attack
• Commodities:  Trump confirms 50% tariffs on copper; gold finds a fresh bid
• Macro events:  US weekly initial jobless claims & 30-year bond auction.

Macro data and headlines

• Minutes from the June FOMC meeting showed an emerging divide among Fed officials over the outlook for interest rates, driven largely by differing expectations for how tariffs might affect inflation.
• President Trump unveiled a new round of tariff demand letters, including a 50% rate on Brazil—a country with which the U.S. recorded a goods trade surplus in 2024—citing the treatment of former President Jair Bolsonaro as justification. The move underscores the growing risk that Trump is willing to weaponize tariffs to address virtually any issue that captures his attention, trade-related or not.
• Trump also announced a 50% tariff on copper imports starting August 1—a move that, given the U.S.’s heavy reliance on foreign supply, could drive up the cost of everything from appliances, electronics, and automobiles to home repairs, construction, and even electricity bills.
• Most Fed officials see a rate cut as likely this year, citing temporary inflation pressures and potential economic softening, June FOMC minutes show. Some support an early cut, while others prefer no change in 2025.
• US mortgage applications jumped 9.4% in early July, the biggest weekly gain in a month, per Mortgage Bankers' Association data. It marked a third straight weekly rise—the longest streak since December 2024—as mortgage rates fell to their lowest since April.
• China’s consumer prices rose 0.1% in June, ending a three-month decline and beating expectations of no change. It was the first annual inflation uptick since January, driven by e-commerce sales, government subsidies, and easing U.S. trade tensions.

Macro calendar highlights (times in GMT)

0600 – Norway June CPI
1230 – US Weekly Initial Jobless Claims
1430 – EIA's Weekly Natural Gas Storage Change
1700 – US to Sell USD 22 billion 30-year Bonds

Earnings events

Thursday: The Progressive Corporation, Fast Retailing, Cintas Corporation, Kongsberg, Delta Airlines

For all macro, earnings, and dividend events check Saxo’s calendar.

Q3-2025 Investor Outlook:  Beyond American shores – why diversification is your strongest ally

Equities

• US: Wall Street advanced Wednesday, lifted by tech as Nvidia touched a $4T valuation and the Nasdaq closed at a new high. The S&P 500 rose 0.61%, Dow +0.49%, and Nasdaq 100 +0.72%, snapping a two-day slide. The Fed minutes showed policymakers are cautious on rate cuts, citing Trump’s expanding tariffs as inflationary. Trump raised tariffs on Brazil (50%), copper, and semiconductors, unsettling markets but failing to derail tech enthusiasm. Pharma stocks traded mixed on the looming 200% drug tariffs. Palantir gained 2.5%, and Verona Pharma soared 20.6% on takeover rumors.
• Europe: European markets surged as hopes of an EU-US trade deal outweighed Trump’s tariff threats. The DAX +1.42% and CAC 40 +1.44% hit fresh highs. Trump signaled he may offer the EU a “baseline rate,” softening fears of a full-blown trade war. Defensive sectors and banks led the rally: Siemens +3.9%, Deutsche Bank +3.4%, BNP Paribas +3.2%. In Paris, EssilorLuxottica soared 5.6% after Meta reportedly took a stake. The FTSE 100 lagged slightly, up just 0.14%, with mining losses (Glencore -2.7%) offsetting gains in banking and consumer stocks.
• UK: The UK market edged higher as investors digested Trump’s latest trade actions and looked ahead to GDP data. The FTSE 100 +0.14% was held back by a dramatic 18.8% plunge in WPP after a profit warning. Pharma names like GSK and AstraZeneca rose modestly despite tariff risks. Water utility headlines and funding talks (e.g., Thames Water) added to local uncertainty. Traders are now watching upcoming economic data and signs of broader sector rotation.
• Asia: Asian equities were mixed. The KOSPI led gains (+1.25%), buoyed by SK Hynix (+4.3%) and Samsung (+1%) after Nvidia’s surge. The Hang Seng recovered slightly (+0.39%), while the Nikkei lagged (-0.68%) amid stalled tariff talks with the US. The ASX rose 0.58%, helped by renewed RBA rate-cut hopes. While Trump’s extended tariff threats remained a cap on upside, optimism over possible exemptions (EU, India) supported risk sentiment regionally.

Volatility

• Volatility continued to ease. The VIX fell 5.2% to 15.94, and short-term gauges like VIX1D dropped below 10 for the first time this month. Futures held in contango, with VIX July futures at 17.3. ETF flows showed increased hedging: $101.7M added to long-volatility ETFs, the biggest daily inflow since June 6. Options now price a modest ±24.8pt move for the S&P 500 today (~0.4%), suggesting a return to calmer conditions—though CPI and jobless claims could test that narrative.

Digital Assets

• Bitcoin briefly hit a new all-time high above $111,900 before pulling back on profit-taking and tariff jitters. Still, it held above $111K, up 2.1%, while Ethereum gained 5.7% to $2,785. ETF flows remain robust: IBIT +2.85%, ETHA +6.2%, supported by treasury accumulation and institutional interest. XRP +0.86%, Solana +0.23%, and meme coins like Dogecoin +5% extended gains. MSTR and COIN rose 4.7% and 5.3%, respectively. A record run, but eyes are now on next week’s CPI and crypto policy announcements in Washington.

Fixed Income

• US Treasuries rebounded on Wednesday with the 10-year benchmark yield falling 7 basis points to after an auction of 10-year notes drew strong demand, easing concerns that investors will balk at financing swelling US deficits. The auction of USD 39 billion drew a yield of 4.362%, slightly lower than indicated by pre-auction trading, indicating demand exceeded expectations. A USD 22 billion sale of 30-year bonds is set for later today

Commodities

• New York copper futures rose after Trump confirmed a 50% tariff on imports would take effect on August 1. However, with the U.S. already having imported the equivalent of 12 months’ supply this year, import activity is expected to slow as consumers work through existing stockpiles. Combined with the fact that the U.S. imports only about half of its copper needs, the New York premium over London has, for now, stabilized around 28%.
• Gold climbed back above USD 3,300 after rebounding from trendline support near USD 3,285, drawn from the January lows. Gains were supported by falling bond yields following a well-received 10-year auction, renewed tariff concerns, and rising speculation about growth, inflation, and the future path of U.S. interest rates—fueled in part by Trump’s intensified criticism of the Fed chair and calls for sharply lower rates.  

Currencies

• The USD trades softer overnight following a mixed Wednesday, that saw it gain strength late against the BRL after President Trump announced a 50% tariff and a Section 301 probe over Brazil’s digital trade practices. The FOMC minutes had little market impact. The EURUSD edged higher towards 1.1750 on mixed trade signals, with the EU not expecting a tariff letter. GBPUSD was volatile around 1.3600 as PM Starmer reaffirmed no tax hikes. Meanwhile, the JPY strengthened, recovering earlier losses as USDJPY retreated from the 147.00 level.