Major U.S. equity markets closed lower as President Trump's renewed calls for 50% tariffs on the European union and 25% import taxes on Apple reignited trade concerns. Bond yields declined, with the 10-year Treasury at 4.51%, reflecting investor worries over rising deficits from potential tax cuts.
European markets traded lower in response to President Trump’s proposal of a 50% tariff on EU goods, reviving fears of escalating trade tensions. Additionally, European Commission (EC) reduced its forecast for economic growth in 2025 to 0.9% from the 1.3% it had projected in late 2024
Japan and China’s stock markets ended the week lower, with Japan pressured by rising expectations of further monetary tightening following stronger inflation data, while China faced tariff concerns, though analysts believe it has the financial capacity to cushion the impact and may introduce phased fiscal stimulus as needed
The late-week threats of 50% tariffs on the EU and a 25% levy on Apple reinforced that Trump-era trade tensions remain a key market concern. With the 90-day pause on initial tariffs expiring in July and reduced China tariffs ending in August—alongside a looming U.S. debt-ceiling standoff—market volatility may intensify. While a resolution is expected, it may come only at the last minute
| Index | Current Price | 1 Week Return % |
|---|---|---|
| S&P 500 | 5,802.82 | -2.61% |
| DJIA | 41,603.07 | -2.47% |
| Nasdaq | 18,737.21 | -2.47% |
| FTSE 100 | 8,717.97 | 0.38% |
| Shanghai Composite | 3,348.37 | -0.57% |
| Sensex | 81,721.08 | -0.74% |
| ADX Index | 9,665.34 | 0.12% |
| Gold | 3,394.50 | 4.82% |
| Brent Oil | 64.21 | -1.83% |
With tariffs expected to stay above early-year levels, markets are likely to face a mix of persistent inflation and slower economic growth. We continue to advocate for a diversified approach, incorporating both international and domestic equities across various sizes, styles, and sectors. On the fixed-income side, we recommend overweighting intermediate- and long-term bonds, particularly as the 10-year Treasury yield approaches the upper end of its recent 4.30% - 4.50% range.
Disclaimer
This commentary is provided for informational purposes only and does not constitute investment advice. For detailed insights, contact our investment team.
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