Equities stall as early enthusiasm ebbs; Amazon, Apple earnings due

NEW YORK – US stocks closed well off early highs on Thursday, following the latest round of corporate earnings and economic data, as investors awaited results from megacaps Amazon and Apple due after the closing bell.

Microsoft shares rose after it posted a strong earnings report and briefly surpassed the USD 4 trillion market cap threshold, becoming only the second publicly traded company to ever touch the milestone after Nvidia.

Meta Platforms surged and hit an intraday record high of USD 784.75 as AI-driven growth in its core ad business powered a bullish revenue forecast.

Still, other AI-related names such as chipmakers Broadcom and Nvidia were weaker on the session, which weighed on the PHLX semiconductor index.

“Looking at the market action today, you have haves and have-nots, and so you have a couple tech companies, like a lot of the semiconductor-related and semi-cap equipment-related stocks are doing pretty poorly,” said Ellen Hazen, chief market strategist at F.L. Putnam Investment Management in Lynnfield, Massachusetts.

“But then, of course, Microsoft is doing pretty well, and the same thing with Amazon and Meta, which are doing really well.”

Of the 297 companies in the S&P 500 that have reported earnings through Thursday morning, 80.8% have topped analyst expectations, according to LSEG data, compared with the 76% beat rate over the past four quarters

According to preliminary data, the S&P 500 lost 19.33 points, or 0.37%, to end at 6,339.31 points, while the Nasdaq Composite gained 8.40 points, or 0.04%, to 21,138.08. The Dow Jones Industrial Average fell 320.83 points, or 0.72%, to 44,140.45.

The S&P 500 had risen as much as 1% and the Nasdaq as much as 1.5% earlier in the session. The Nasdaq has not logged a move of at least 1% in either direction since July 3 while the S&P last recorded a daily 1% move on June 24.

Earlier economic data from the Commerce Department report showed inflation picked up in June, with new tariffs pushing prices higher and stoking expectations that price pressures could intensify in the coming months, while weekly initial jobless claims signaled the labor market remained on stable footing.

Investors will now eye Friday’s non-farm payrolls report and a looming tariff deadline, as US President Donald Trump was expected to issue higher final duty rates for countries that have not reached an agreement, although Mexico was granted a 90-day reprieve.

US stocks have rallied after a sharp selloff that began in early April after Trump announced a bevy of sharp tariffs, only to rebound as deals have been struck with many trading partners on duty levels. The Dow, S&P 500 and Nasdaq recorded their third straight monthly gain.

Drug stocks were also weaker after the White House said Trump sent letters to the CEOs of 17 major pharmaceutical companies, urging immediate action to lower the cost of prescription drugs for Americans. The NYSE Arca pharmaceutical index was down 2.3%.

(Reporting by Chuck Mikolajczak, additional reporting by Nikhil Sharma and Pranav Kashyap in Bengaluru; Editing by Marguerita Choy)

Gold falls over 1% after Fed keeps rates steady, strong US data

Gold fell more than 1% on Wednesday as the Federal Reserve held interest rates steady and gave little indication of when cuts might occur, while strong US economic data further dimmed the appeal of the zero-yield asset.

Spot gold was down 1.5% at USD 3,275.92 per ounce, as of 03:08 p.m. ET (19:08 GMT).

US gold futures settled 0.8% lower at USD 3,352.8.

The Federal Reserve held interest rates steady in a split decision that gave little indication of when borrowing costs might be lowered and drew dissent from two of the US central bank’s governors.

Fed Chair Jerome Powell said the central bank had made no decision about September, when many market participants were expecting the first interest rate cut of the year to be made. He added that “downside risks to the labor market are certainly apparent.”

“Powell sticks to his guns as he focuses more on keeping inflation in check than employment concerns,” said Tai Wong, an independent metals trader.

“The dollar jumped, putting additional pressure on gold, though bullion continues to hold the bottom of the range. While a deeper retracement may occur, that will likely draw buyers as the overall argument for gold – uncertainty, high US debt, de-dollarization, remains robust.”

The ADP National Employment report showed US private payrolls rose more than expected in July, though signs of labor market softening persisted.

Nitesh Shah, commodities strategist at WisdomTree, noted that the louder the Trump administration voices its distaste for current policymaking, the more likely it is to drive gold prices.

Gold tends to perform well in a low-interest rate environment and during periods of uncertainty.

Spot silver dropped 3.2% to USD 36.97 per ounce, hitting a near three-week low.

Platinum lost 6.6% to USD 1,303.19, its lowest since June 24, while palladium was down 4.9% to USD 1,196.75.

It looks like some profit-taking by the shorter term futures traders, said Jim Wyckoff, a senior analyst at Kitco Metals.

“The fact that the gold market has sold off a little bit recently, I think that’s put some pressure on platinum and Palladium.”

(Reporting by Sherin Elizabeth Varghese and Sarah Qureshi in Bengaluru; Editing by Tasim Zahid, Vijay Kishore, and Rod Nickel)

US yields climb as Fed’s Powell uncertain about September easing

NEW YORK – US Treasury yields rose on Wednesday after Federal Reserve Chair Jerome Powell said it’s too soon to say whether the central bank will cut its interest rate target in September.

“We have made no decisions about September, we don’t…do that in advance,” Powell said at a press conference after the Fed held interest rates steady at the end of a two-day policy meeting, as widely expected.

He said going forward, “we’ll be taking that information” about the economy in the run-up to the next central bank gathering.

In standing pat for a fifth straight policy meeting, the Fed cited low unemployment and solid labor market conditions. But it noted that economic growth “moderated in the first half of the year,” boosting the case to lower rates at a future meeting should that trend continue.

The Fed kept its benchmark overnight interest rate tethered in the 4.25%-4.50% range. Wednesday’s Fed decision, however, saw two dissenting votes by governors, the most in more than three decades.

In late afternoon trading, the benchmark US 10-year yields were last up 4.4 basis points (bps) at 4.372%, while the two-year yield, which reflects interest rate expectations, was up 5.7 bps at 3.932%.

US 30-year yields were also higher on the day, up 3.1 bps at 4.899%.

“There’s enough evidence to suggest that the Fed should be cutting right now…we do think that beneath the surface economic activity has slowed down and that’s true whether you’re looking at consumption or it’s true whether you’re looking at labor,” said Tom Porcelli, chief US economist, at asset manager PGIM in Newark.

“In many ways the Fed is haunted by the ghost of (a) transitory past. That gives them an element of pause…I think because of the transitory mistake, it slows down their reaction function,” he said, referring to the Fed’s slow response to inflation during the pandemic years on views it would be short-lived.

Both Vice Chair for Supervision Michelle Bowman and Governor Christopher Waller, who has been mentioned as a possible nominee to replace Powell when his term expires next May, were appointed to the board by Trump and “preferred to lower the target range for the federal funds rate by one quarter of a percentage point at this meeting,” the Fed’s policy statement said.

Treasury yields briefly ticked lower after the disclosure of the two dissenting votes.

Federal funds futures, which are tied to the US central bank’s monetary policy, are implying lower odds of a rate cut in September with a 50% probability, according to LSEG calculations. That was 65% before the Fed statement.

US rate futures also reduced the expected pace of easing this year to just 39 bps. That was 44 bps before the Fed decision.

In other parts of the bond market, the yield curve flattened, with the gap between two-year and 10-year yields narrowing to 43 bps after Powell’s press conference, compared with 44.9 bps late on Tuesday.

The curve flattened after the Fed chief gave no signal of a September cut, leading investors to sell two-year Treasuries, pushing their yield higher.

Earlier in the session, the US yields gained after data showed gross domestic product increased at a 3.0% annualized rate last quarter, the Commerce Department’s Bureau of Economic Analysis said in its advance estimate of second-quarter GDP.

“This report likely gives the Fed a little more air cover to hold rates steady through summer,” wrote Scott Helfstein, Global X’s head of investment strategy, in emailed comments.

At the same time, US private payrolls increased more than expected in July, the ADP National Employment Report showed on Wednesday.

Private payrolls rose by 104,000 jobs last month after a revised 23,000 decline in June. Economists polled by Reuters had forecast private employment increasing 75,000 following a previously reported drop of 33,000 in June.

(Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Saeed Azhar; Editing by Andrea Ricci and Daniel Wallis)

Oil steady after big gains on Trump’s Russia ultimatum

BEIJING – Oil prices ticked up in early trading on Wednesday after rising more than 3% in the previous session as potential supply shortages came into focus after US President Donald Trump gave Moscow an abbreviated deadline toward ending the war in Ukraine.

Brent crude futures rose 14 cents, or 0.19%, to USD 72.65 a barrel by 0048 GMT while US West Texas Intermediate crude climbed 2 cents, or 0.03%, to USD 69.23 a barrel.

Both contracts had settled at their highest since June 20 on Tuesday.

On Tuesday, Trump said he would start imposing measures on Russia, including 100% secondary tariffs on its trading partners, if it did not make progress on ending the war within 10-12 days, moving up an earlier 50-day deadline.

“Effective secondary 100% tariffs would lead to a dramatic shift in the oil market. A number of key buyers of Russian oil would likely be reluctant to continue purchases, particularly large US trading partners,” ING analysts said in a note.

“While this gives OPEC+ room to start unwinding additional tranches of supply cuts, it would still leave the market in deficit under a worst-case scenario.”

The US had warned China, the largest buyer of Russian oil, that it could face huge tariffs if it continues buying, Treasury Secretary Scott Bessent told a news conference in Stockholm where the US was holding trade talks with the EU.

JP Morgan analysts said in a note that while China was not likely to comply with US sanctions, India has signaled it would do so, potentially putting 2.3 million barrels per day of Russian oil exports at risk.

The US and EU averted a trade war with a deal that included 15% US tariffs on European imports, easing concerns about the impact of trade tensions on economic growth and offering further support to oil prices.

In Venezuela, foreign partners of state oil company PDVSA are still waiting for authorisations from the US to operate in the sanctioned country after talks on the subject last week, which could return some supply to the market, potentially easing pressure for prices to rise.

(Reporting by Colleen Howe; Editing by Muralikumar Anantharaman)

Gold holds steady ahead of Fed policy statement

Gold prices steadied on Wednesday as investors held back on making big bets ahead of the Federal Reserve’s policy statement later in the day for cues into future rate cuts, while focus remained on US trade talks ahead of the August 1 deadline.

FUNDAMENTALS

* Spot gold was steady at USD 3,329.19 per ounce as of 0020 GMT. US gold futures GCcv1 rose 0.1% to USD 3,327.70.

* US and Chinese officials agreed to seek an extension of their 90-day tariff truce on Tuesday, following two days of talks in Stockholm.

* However, US officials said it was up to President Donald Trump to decide whether to extend a trade truce that expires on August 12 or potentially let tariffs shoot back up to triple-digit figures.

* Meanwhile, the US dollar index held steady after hitting a more than one-month high on Tuesday, making greenback-priced bullion more expensive.

* Investors turned their focus to the Fed’s policy to gauge its future rate cut path, following the central bank’s two-day meeting, during which it is widely expected to keep rates steady, despite Trump’s constant call to lower them.

* The US trade deficit in goods narrowed to its lowest in nearly two years in June as imports fell sharply, cementing economists’ expectations that trade likely accounted for much of an anticipated rebound in economic growth in the second quarter.

* The International Monetary Fund slightly raised its global growth forecasts for 2025 and 2026 on Tuesday, citing stronger-than-expected buys ahead of a jump in US tariffs on August 1 and a drop in the effective tariff rate to 17.3% from 24.4%.

* Meanwhile, on Tuesday, Trump threatened tariffs and other measures on Russia “10 days from today” if Moscow showed no progress toward ending its more than three-year-long war in Ukraine.

* Spot silver held steady at USD 38.20 per ounce, platinum fell 0.4% to USD 1,389.20 and palladium remain unchanged at USD 1,258.75.

(Reporting by Anmol Choubey in Bengaluru; Editing by Sumana Nandy)

Bond investors warm to risk, with Fed staying put in ‘Goldilocks’ economy

NEW YORK – Bond investors are adding portfolio risk after a long period of caution, seeing the US economy in a “Goldilocks” moment, not too hot nor too cold, as they bet the Federal Reserve will leave rates unchanged for a fifth straight policy meeting.

Investors are buying more corporate bonds and adding a little bit more duration to their portfolios, suggesting they’re more comfortable going further out the curve.

The US central bank’s policy-setting Federal Open Market Committee is broadly expected to keep its benchmark overnight interest rate in the 4.25%-4.50% range when its two-day meeting ends Wednesday. Standing pat has been its default stance since December, given a surprisingly resilient economy that has seen a fairly stable labor market and generally subdued inflation.

“Our systems are saying that economic growth seems to be fairly firm, although we could argue that it’s fraying at the edges,” said Jeff Young, head of investment strategy, at PGIM Quantitative Solutions in New Jersey.

“We’ve seen some prices ticking up, but that’s not necessarily overall generalized inflation. It’s a one-off price increase on certain goods and that has allowed the Fed to maintain this wait-and-see posture.”

Futures tracking the Fed’s policy rate show a roughly 65% chance that the central bank will deliver a rate cut in September, with another possible at the October or December meetings. All told, rates futures on Monday implied about 44 basis points (bps) of easing in 2025, or just under two rate declines of 25 bps each.

The Fed reduced rates three times in 2024 before pausing its easing cycle early this year.

The US central bank’s current wait-and-see approach is a signal for bond investors to tiptoe back into risk-taking, analysts said.

“We are overweight credit risk within our portfolios, getting risk back that we sold or removed in March and the beginning part of April given the uncertainty and tight valuations at that point in the economy,” said Vishal Khanduja, head of broad markets fixed income at Morgan Stanley Investment Management in Boston.

“Growth is slowing, but not slowing into recession levels. So this almost makes it a very ‘Goldilocks’ type of environment for fixed income, especially credit where you don’t see recession fears and balance sheets are very strong, both consumer and corporate.”

FADING WORRIES

Signs of easing anxiety have been in place in the bond market the last few weeks.

J.P. Morgan said in its latest Treasury survey as of a week ago that the percentage of all clients that are long duration relative to their benchmarks has increased to 30% from 26% in the previous week. Adding duration can reflect optimism that interest rates will fall.

Expressed in number of years, duration relates to how far a bond’s value will fall or rise when interest rates move. In general, when rates fall, higher-duration bonds experience a greater increase in value compared to those with lower duration.

In the credit market, spreads to Treasuries have also narrowed since blowing out the week after President Donald Trump’s April 2 “Liberation Day” tariff announcements that panicked markets with the prospect of trade wars that could exacerbate inflationary pressures.

The investment-grade bond spread stood at 78 basis points (bps) last Friday, the tightest since mid-November last year, and 1 bp shy of the lowest point of 77 bps hit in 1998, according to ICE BAML data. It had touched 121 bps, or the highest since November 2023, in the days after Liberation Day.

The high-yield spread also showed a similar recovery, showing 284 bps last Friday, down from 461 bps a week after Liberation day.

A narrower spread indicates that bond investors are demanding less additional yield to hold riskier corporate bonds over safer US Treasuries and reflects confidence about the US economy and corporate health.

Bond volatility has also been low, suggesting a stable economic environment for fixed income investors. As of last Friday, the ICE BofA MOVE index was 82.09, a two-week low.

“We are running our portfolio at lower levels of risk than our long-run averages,” said Dan Siluk, head of global short duration and liquidity at Janus Henderson Investors, but he clarified that caution remains because the firm has kept duration shorter.

“We’ve got more triple Bs (corporate bonds with a Triple B-rating), we’ve got high yield in the portfolio, but rather than owning a three-year, I’m going to own the one-year, he added. “And that means I’m turning the portfolio over more, but I’m looking for good opportunities.

Other bond investors are similarly cautious, but on the lookout for relative value.

“The quality of the portfolio is the highest it has ever been given all the uncertainty. So we have been more defensive. But we’re still deploying cash and we are looking for relative value opportunities,” said David Norris, a partner at TwentyFour Asset Management.

“We think markets are very frothy given the action in spreads.”

(Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Laura Matthews; Editing by Alden Bentley and Anna Driver)

Prices dip after EU trade deal, ahead of auctions

NEW YORK – US Treasuries slipped on Monday, pushing yields higher, as risk sentiment suggested more optimism about the global economic outlook after the United States and the European Union struck a trade agreement on Sunday that was received with mostly relief by investors.

It’s an event- and data-packed week starting with the Treasury’s refunding announcement on Wednesday. The US Treasury is widely expected to maintain current auction sizes for notes and bonds when it announces financing plans, and will likely keep them steady for some time.

Bond market participants are also bracing for Monday’s auctions of USD 69 billion in US two-year notes and USD 70 billion in five-year Treasuries. That has spurred some concession in the market, meaning investors are selling Treasuries ahead of the auction so they can buy them back later at a lower price.

The Treasury will also auction USD 82 billion in 13-week bills, and USD 73 billion in 26-week debt later on Monday. It has focused on issuing Treasury bills to rebuild its cash balance that has been depleted with a debt ceiling issue that was unresolved prior to President Donald Trump’s tax and spending legislation being signed into law on July 4.

But it has been the EU trade deal that has set the bond market on this risk-on path.

The agreement, announced on Sunday between two economies that account for almost a third of global trade, will see the US impose a 15% import tariff on most EU goods – half the threatened rate but much more than what Europeans hoped for.

The EU also pledged to make USD 750 billion in strategic purchases, covering oil, gas, nuclear, fuel and chips during Trump’s term, including up to USD 600 billion in US military equipment.

“The trade deal over the weekend was the first that investors can trade on. I don’t think anybody was really expecting that,” said Jim Barnes, director of fixed income, at Bryn Mawr Trust in Berwyn, Pennsylvania.

“The market has taken that on the positive side, with the equity market starting higher, bond yields trending up,” Barnes said adding that the deal has reduced some uncertainty in the market, spurring more growth.

In late morning trading, the benchmark 10-year yield was up 2.4 basis points (bps) at 4.409%, after posting last Friday its largest weekly decline in a month. US 30-year yields rose 2 bps to 4.947%. On Friday, 30-year yields posted their biggest weekly fall in two months.

The two-year yield, which reflects interest rate expectations, edged up 1.3 bps to 3.929%.

The Federal Reserve also meets this week in a two-day meeting. It is broadly expected to keep its benchmark overnight interest rate in the 4.25%-4.50% range when its two-day meeting ends on Wednesday.

Ahead of the auction, US five-year yields were up 1.4 bps at 3.966%.

Analysts expect Monday’s sale of two-year and five-year notes to be well-received.

“All else being equal, we’d expect this reality to cheapen the front-end of the curve as an auction concession,” wrote BMO Capital Markets in a research note, referring to expectations that yields will fall after the auction.

The Treasury will also announce later on Monday borrowing estimates for the quarter. In the Treasury’s preliminary estimate in May, the department announced that it would borrow USD 554 billion for the third quarter. Analysts expect that figure to sharply increase.

(Reporting by Gertrude Chavez-Dreyfuss; Editing by Nick Zieminski)

Is US stock rally near ‘Mag 7’ turning point?: McGeever

ORLANDO, Florida – As investors brace for the busiest week of the US earnings season, with four of the ‘Magnificent Seven’ tech giants reporting, debate is picking up again about these megacap firms’ influence over US equity indexes and whether we could be seeing the beginnings of true market broadening.

By some measures, this small clutch of tech titans’ profits, market cap, and valuations as a share of the wider market has never been bigger. Broader indices are at record highs, but strip out these firms and the picture is much less rosy.

Indeed, since the beginning of 2023, the S&P 500 composite – the benchmark ‘market cap’ index increasingly dominated by the ‘Mag 7’ – has gained 67%, more than double the ‘equal-weight’ index’s 32%.

Only two years ago, the S&P 500 composite/equal-weight ratio was 0.66, meaning the composite index was worth around two-thirds of the equal weight index. That ratio is now 0.84, the highest since 2003.

There’s good reason for that.

According to Larry Adam, chief investment officer at Raymond James, 12-month forward earnings estimates for the S&P 500 have outpaced estimates for the equal-weight index by 14%. And Tajinder Dhillon, senior research analyst at LSEG, notes that the ‘Mag 7’ last year accounted for 52% of overall earnings growth.

Many investors and analysts consider it unhealthy to have the fate of the entire market dependent on so few companies. It may be fine when they’re flying high, but not so much if one or two of them take a dive. Plus, it makes stock picking more difficult. If the market basically goes where the ‘Mag 7’ or Nvidia go, why should an investor bother buying anything else? That’s a recipe for market inefficiencies.

YACHTS AND ALL BOATS?

There have recently been nascent signs that the market may be broadening out beyond tech and AI-related names, largely thanks to positive news on the trade front. Last week, the equal-weight index eclipsed November’s high to set a fresh record.

Raymond James’s CIO Adam notes that the equal-weight index outperformed the S&P 500 last week for the fourth week in the last 13. More of the same this week would mark its first monthly outperformance since March.

Can it hit this mark? Around 160 of the S&P 500-listed firms report this week, including Meta and Microsoft on Wednesday and Amazon and Apple on Wednesday. It’s not a stretch to say these four reports will move the market more than the rest combined.

LSEG’s Dhillon says the Mag 7’s share of total earnings growth is expected to fall to 37% this year and 27% next year. The expected earnings growth spread between Mag 7 and the wider index in the second quarter – 16.4% vs. 7.7% – is the smallest since 2023, and will shrink more in Q3, he adds.

Larry Adam at Raymond James, however, thinks the recent market broadening is a “short-term normalization” rather than a “material shift”. He thinks the earnings strength of the tech-related sectors justifies the valuation premium on these stocks.

Regardless, what we know for sure is that fears about the market’s concentration and narrowness have been swirling for years and there has yet to be a reckoning. The equal-weight index’s rise to new highs last week suggests the rising tide is lifting all boats, not just the billionaires’ yachts.

Essentially, the Mag 7 and large caps are outperforming, but if you peel back the onion, other sectors like financials and industrials are also doing well. And look around the world. Many indices outside the US that aren’t tech-heavy are approaching or printing new highs also, like Britain’s FTSE 100 and Germany’s DAX.

“To see the largest names leading isn’t a worrisome sign, especially as they are backing it up with very strong earnings,” says Ryan Detrick, chief market strategist at Carson Group. “This isn’t a weak breadth market, it is broad based and a very healthy rally.”

This week’s earnings might go some way to determining whether this continues for a while yet.

(The opinions expressed here are those of the author, a columnist for Reuters)

(By Jamie McGeever; Editing by Chizu Nomiyama and Nia Williams)

Euro, US stock index futures climb after US-EU trade deal

Investors appeared to embrace news of a trade deal between the US and European Union on Sunday that is expected to bring clarity for companies and some certainty to markets ahead of US President Donald Trump’s Friday tariffs deadline.

The euro rose against the US dollar and was last up 0.15% at USD1.176. The currency also was up about 0.1% against the pound and 0.2% against the Japanese yen.

US stock index futures rose after resuming trading late Sunday, with S&P 500 e-minis last up 0.3% and Nasdaq futures up 0.4%. Nikkei futures also traded higher.

Trump and European Commission President Ursula von der Leyen on Sunday announced the deal, which imposes a 15% import tariff on most European Union goods, half the threatened rate.

The EU-US deal is similar to parts of the framework agreement the US clinched with
Japan last week, but it also leaves open questions, including tariff rates on spirits.

“It’s really in line with the Japan deal, and I assume investors will view it positively as they viewed the Japan deal,” said Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey.

“The reality is there will be higher tariffs, which may lead to more inflation, depending on how much of it is absorbed by the manufacturers and how much of it is passed on to consumers.”

Michael Brown, senior research strategist at Pepperstone in London, said: “For the euro, it removes that risk of a huge tariff and potentially getting towards trade embargo levels with the US”

Optimism over easing trade tensions broadly helped push US stocks to record highs last week and lifted European shares to their highest since early June.

“It is odd to think that a late July week in the middle of the summer could prove to be the most pivotal of the year. It has already started with a key trade deal with a major partner,” Michael O’Rourke, chief market strategist at JonesTrading in Stamford, Connecticut, wrote in a note following the news.

Investors have been bracing for increased volatility heading into August 1, which the US has set as a deadline for raising levies on a broad swath of trading partners.

Trump’s April 2 “Liberation Day” announcement of sweeping global tariffs sent stocks plunging in the immediate aftermath, due to spiking fears about a recession that have since faded.

Holger Schmieding, chief economist at Berenberg Bank in London, said of the EU-US announcement: “The crippling uncertainty is largely over, the deal is bearable for the EU. Modestly good news for equity markets, that probably priced in most of it beforehand.

“But of course, the outcome is still bad relative to the situation that prevailed before Trump started his trade wars.”

The announcement came after Von der Leyen traveled to Scotland for talks with Trump to push a hard-fought deal over the line.

Von der Leyen said the 15% tariff applied “across the board,” including automobiles, semiconductors and pharmaceuticals. Trump said the deal also calls for USD750 billion of EU purchases of US energy in coming years and “hundreds of billions of dollars” of arms purchases.

“We will need to see how long the sides stick to the deal,” Eric Winograd, chief economist at investment management firm AllianceBernstein, said.

(Reporting by Lewis Krauskopf and Caroline Valetkevitch; additional reporting by Lucy Raitano in London, Matt Tracy in Washington DC and Karin Strohecker; editing by Alden Bentley, Edward Tobin, Amanda Cooper, Nick Zieminski and Marguerita Choy)

Global equity funds draw weekly inflows on trade deal optimism

Inflows into global equity funds picked up again in the week through July 23 as optimism over US trade deals, stronger than expected US economic reports and an encouraging start to the corporate earnings season boosted risk sentiment.

Global investors snapped up a net USD 8.71 billion worth of equity funds during the week, reversing a USD 4.4 billion net withdrawal in the prior week, data from LSEG Lipper showed.

The United States and Japan agreed a deal earlier this week which cut existing import tariffs on Japanese goods to a lower-than-threatened 15%. Investors were also hopeful about the prospects of the US and the European Union settling on US import tariffs of around 15%.

Investors took comfort from encouraging initial earnings reports as advanced AI chip maker TSMC posted a record profit and Gatorade owner PepsiCo upgraded its earnings forecasts.

Net European equity fund inflows reached an 11-week high of USD 8.79 billion, while Asian funds drew a net USD 1.17 billion. US equity funds lagged, although net outflows eased to USD 2.68 billion from about USD 11.67 billion the prior week.

The technology sector gained USD 1.61 billion, reversing the previous week’s USD 576 million net outflow. The financial and industrial sectors also saw USD 1.13 billion and USD 1.61 billion net additions, respectively.

Net purchases of global bond funds extended into a 14th week as they added USD 17.94 billion.

Investors pumped USD 4.14 billion into short-term bond funds, the largest amount in 13 weeks. Euro-denominated bond funds and high-yield funds attracted a net USD 3.89 billion and USD 2.51 billion, respectively.

Gold and precious metals commodity funds recorded a net USD 1.9 billion worth of purchases, the largest weekly figure since June 18.

Global money market funds drew a net USD 2.09 billion after about USD 21.78 billion of net sales a week ago.

Emerging markets saw a revival in buying interest with investors adding bond funds of USD 2.19 billion and equity funds of USD 250 million after net disposals of USD 1.14 billion and USD 155 million in the prior week, data for a combined 29,669 funds showed.

(Reporting by Gaurav Dogra in Bengaluru; Editing by Kirsten Donovan)

2024 Mid-Year Economic Briefing: Navigating the Easing Cycle

Investing with Love: A Mother’s Guide to Putting Money to Work

Investor Series: An Introduction to Estate Planning

January Economic Update: Growth slows, prices rise

Inflation Update: Up, up, and away?