2025-08-01 10:43

LONDON, Aug 1 (Reuters) - What matters in U.S. and global markets today By Mike Dolan , opens new tab, Editor-At-Large, Finance and Markets Sign up here. A tariff day blitz, pharma hit and Amazon stumble all left a cloud over Friday's stock markets as the U.S. monthly employment report is set to test faded Federal Reserve easing bets. The bombardment of tariff developments, economic data and earnings news this week has left macro markets slightly nonplussed, but Wall Street futures and global bourses took a dimmer view of the whole picture heading into the final day. * As U.S. President Donald Trump detailed his August 1 tariff list, Canada failed to escape 35% levies - unlike the reduced 15% rates Japan and Europe had negotiated - and the Canadian dollar plumbed two-month lows. Mexico got another 90 day reprieve. Brazil faces 50%, though for a more limited series of goods than feared. Switzerland faces 39%. * Amazon blotted the otherwise impressive megacap earnings copybook, with a poorly received earnings outlook that sent its shares down 7% overnight. Apple's beat lifted its stock 1%. But pharmaceutical stocks in the U.S. and abroad were knocked back. Trump sent letters to 17 major pharma firms outlining how they should slash U.S. prescription drug prices. U.S. index futures and European bourses were down more than 1% ahead of Friday's bell. * Markets now await the July payrolls report, with a slowdown in jobs growth to 110,000 last month expected even though immigration curbs have also cut the available workforce. A wary Fed is absorbing a week of relatively hot growth and inflation numbers, with futures seeing less than a 50% chance of rate cuts resuming at its next meeting in September. U.S. economic surprise indexes are at their most positive since February, while euro zone equivalents are the highest in more than a year. The rejuvenated dollar continues to probe higher, with its DXY index at two-month highs as dollar/yen shrugged off mixed Bank of Japan signals by hitting its highest since March. Today's Market Minute * President Trump slapped steep tariffs on exports from dozens of trading partners including Canada, Brazil, India and Taiwan, pressing ahead with his plans to reorder the global economy ahead of a Friday trade deal deadline. * As Trump's new tariff regime clicks into gear on Friday, producers around Europe are feeling the impact, some holding back shipments, others hiking sticker prices or taking a hit to margins. Some fear they won't survive at all. * Asia's factory activity deteriorated in July as soft global demand and lingering uncertainty over U.S. tariffs weighed on business morale, private sector surveys showed on Friday, clouding the outlook for the region's fragile recovery. * Federal Reserve Chair Jerome Powell made it clear that the resilient U.S. labor market is currently the primary determinant of monetary policy, a signal that strong July employment figures could snuff out all bets for a September rate cut and reduce the likelihood of any further easing this year. Read the latest from ROI columnist Jamie McGeever. * Europe and Asia could leverage Trump’s "America First" strategy for their own benefit, writes TPW Advisory Founder Jay Pelosky, eventually spurring the development of regional tripolar FX blocs that could erode the dominance of the U.S. dollar and reshape global markets. Weekend Reads POPULATION GROWTH RESET: Compounded by halted immigration and aging, U.S. population growth has halved to an annualized rate of just 0.5% since late 2023 and the 'breakeven rate' of monthly payroll growth that would keep pace up with the labor force has almost halved over the past year to 86,000 in June 2025 , opens new tab. So concludes Peterson Institute fellow Jed Kolko, adding: "any given level of monthly payroll growth, consumption growth or output growth reflects a stronger economy than it did a year ago." MONETARY CONDITIONS INDEX: A Bank for International Settlements working paper introduces a new monetary policy conditions index , opens new tab (MCI) that combines the impact of both interest rate settings and the size of central bank balance sheets to help policymakers coordinate both aspects. "At the current juncture, the MCI highlights the persistence of large central bank balance sheets - either considering the U.S. or at the global level - loosens the stances of monetary policy." EUROPE ROLLS OVER?: In a stinging critique of the European Union's decision to accept higher U.S. tariffs without retaliation and pledge hundreds of billions in spending to boot, Alberto Alemanno, Professor of European Union Law at HEC Paris, writes of "Europe's Economic Surrender" , opens new tab. In a column on Project Syndicate, Alemanno said the EU deal highlights the bloc's inability to present a united front and cements its dependence on the United States - rendering it a "prosperous yet powerless appendage" of America. INDEPENDENCE AND SPACE: Greater central bank independence from politics actually offers governments more fiscal space , opens new tab by reducing the costs of borrowing over time and allowing higher debt-to-GDP ratios, according to a World Bank working paper that examines the experience of 155 countries over 50 years. POWELL AND CREDIBILITY: Using data from online betting platform Polymarket, University of California, Berkeley Professor Barry Eichengreen and co-authors look at how Donald Trump's relentless pressure on Fed Chair Jerome Powell affects ideas of central bank independence , opens new tab and market outcomes. In a column on CEPR's VoxEU, they show that rising criticism of the Fed boss matches expectations of lower short-term interest rates - along with higher long-term borrowing rates and higher recession fears. 'ASLEEP AT THE WHEEL'?: In a critique of the latest benign world economic forecasts from the International Monetary Fund, former IMF official Desmond Lachman accuses the Fund of failing to warn of outsize global macro risks , opens new tab from rising U.S. deficits and protectionism. In a piece published by the American Enterprise Institute think tank, Lachman lambasts the IMF's record on crisis warnings and said it's "difficult to see how (the U.S.) economy too will not come to a sorry end as a result of its public finance excesses." LESS RAIN, MORE WHEAT: A revolution in farm management has enabled Australia to produce 15 million metric tons more wheat annually than in the 1980s - despite hotter, drier conditions. The increase is equivalent to 7% of all wheat shipped around the planet each year. In a Reuters Special Report, Peter Hobson shows how the ability of Australia's farmers to produce more owes largely to innovations that changed the seeds they plant, how they plant them and how they cultivate the soil. Chart of the day The United States imposed steep import tariffs on goods from dozens of trading partners, including Canada, Brazil, India and Taiwan, as Friday's deadline hit, pressing ahead with plans to reorder the global economy. The order listed higher import duty rates of 10% to 41% starting in seven days for 69 trading partners. The seven-day lead time offered some hope that last-minute deals may yet emerge. In the meantime, U.S. federal appeals court judges questioned Trump's use of emergency powers to justify his tariffs as hearings began on Thursday and a final decision is expected later in the month. Today's events to watch * U.S. July employment report (8:30 AM EDT), July manufacturing surveys from ISM (10:00 AM EDT) and S&P Global (9:45 AM EDT), University of Michigan final July consumer sentiment reading (10:00 AM EDT) * U.S. corporate earnings: Exxon Mobil, Chevron, Moderna, Regeneron, Colgate Palmolive, T Rowe Price, Kimberly-Clark, WW Grainger, LyondellBasell, Dominion Energy, Franklin Resources, Linde, Church & Dwight Want to receive the Morning Bid in your inbox every weekday morning? Sign up for the newsletter here. You can find ROI on the Reuters website , opens new tab, and you can follow us on LinkedIn , opens new tab and X. , opens new tab Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles , opens new tab, is committed to integrity, independence, and freedom from bias. https://www.reuters.com/business/finance/global-markets-view-usa-2025-08-01/

2025-08-01 10:27

MUMBAI, Aug 1 (Reuters) - The Indian rupee nudged higher on Friday, supported by likely intervention from the Reserve Bank of India, but still logged its worst weekly drop since late 2022 due to worries over U.S. tariffs and sustained foreign portfolio outflows. The rupee closed at 87.54 against the U.S. dollar on Friday, a tad higher than its close at 87.5950 in the previous session. On the week, the currency declined 1.2%, its worst performance since December 2022. Sign up here. The South-Asian currency fell to 87.74 on Thursday, just shy of its all-time low of 87.95 in February, following President Donald Trump's announcement of a steeper-than-expected 25% tariff on Indian imports. Firm intervention by the central bank on Friday helped the rupee find some footing, but traders and analysts expect a depreciation bias in the near term. Consistent foreign outflows from local stocks alongside elevated corporate dollar demand are likely to keep the local currency under pressure, traders said. Foreign investors net sold $2 billion of Indian equities in July. India's equity benchmarks, the BSE Sensex (.BSESN) , opens new tab and Nifty 50 (.NSEI) , opens new tab were lower on the day and logged their fifth consecutive weekly fall. Meanwhile, Asian currencies fell after the U.S. imposed sweeping new tariffs on dozens of trading partners. The Korean won led losses with a near 1% fall. The Reserve Bank of India's monetary policy decision and developments related to U.S. trade tariffs will be the key drivers for the rupee next week. "The market now firmly believes that tariffs are transactional rather than ideological," ING said in a note. "Perhaps the biggest risk now is that of secondary sanctions on the likes of China, India and Turkey as Washington tries to turn the screws on Russia and those buying its cheap oil," the brokerage added. The dollar index was up 0.1% at 100.1, as investors await key U.S. labour market data later on Friday to gauge the future path of policy rates in the world's largest economy. (This story has been corrected to change the rupee closing level to 87.54 from 87.53, in paragraph 2) https://www.reuters.com/world/india/rupee-steadies-cap-rough-week-dominated-by-trumps-tariff-jolt-2025-08-01/

2025-08-01 10:22

Aug 1 (Reuters) - Tesla's (TSLA.O) , opens new tab new car sales in Spain rose 27% in July from the same month in 2024 to 702 vehicles, registration data released by industry group ANFAC showed on Friday, while sales of electrified cars as a whole skyrocketed, with a 155% rise. Sales of Tesla cars in Spain were up 1.1% in the first seven months of 2025 from the same period a year earlier, while total sales of electrified vehicles, a category that includes both fully electric vehicles and hybrids, were up 93%. Sign up here. https://www.reuters.com/business/autos-transportation/new-tesla-sales-spain-rise-27-july-other-ev-sales-more-than-double-2025-08-01/

2025-08-01 10:03

Investors scale back U.S. exposure amid tariff uncertainty Dollar's role as global reserve currency questioned U.S. tech sector optimism counters bearish sentiment NEW YORK, Aug 1 (Reuters) - A rebound on Wall Street and in the dollar has not allayed investor concerns about the ability of U.S. assets to outperform overseas markets, with a fresh tariff salvo once again denting market optimism after a string of trade deals struck by the Trump administration perked up sentiment for equities to set record highs. The sliding dollar, down about 8% this year against a basket of major currencies, and the ballooning fiscal deficit are shaking the conviction that U.S. financial markets will deliver world-beating returns. Sign up here. For more than a decade, the concept of "American exceptionalism" - the conviction that the United States' democratic system plus its huge and liquid capital markets offer unique rewards - has been little challenged by investors. But ongoing uncertainty surrounding tariffs is rattling confidence. While the deals struck by Donald Trump with the European Union, Japan and South Korea have delivered some relief, the U.S. president late on Thursday slapped dozens of trading partners with steep tariffs. A market shakeout earlier this year caused by Trump's first tariff announcements triggered a re-evaluation. The U.S. market's standing appears "a little bit bruised," said Lori Heinel, global chief investment officer at State Street Investment Management. "The overhang of the (government) debt makes it less attractive to have dollar-based assets," she added. In a survey conducted in late May and June, market research consultancy CoreData found that many institutional investors and consultants, collectively overseeing $4.9 trillion in assets, are scaling back exposure to the U.S. Among respondents, 47% are cutting their strategic, long-term allocations to U.S. markets. While investors have become more upbeat on the outlook for Europe, as well as for China and other emerging markets, bullishness toward U.S. markets now lags those regions. That, said Michael Morley, head of CoreData US, marks “a massive reversal” from attitudes two years ago. The latest wave of tariffs on exports from dozens of trading partners, including Canada, Brazil, India and Taiwan, sent global markets tumbling on Friday. The announced duties were "somewhat worse than expected," analysts at Societe Generale said in a note. "Markets responded more negatively to the August 1 announcement than to other news in the past two months, but the reaction was far less severe than on April 2," they said. TARIFF IMPACT OVERDUE? Investors began reconsidering their allocations following Trump's "Liberation Day" tariff announcement on April 2, reassessing the allure of "brand USA" and fretting about a new recession. The Trump administration then paused tariff rollouts and subsequently began announcing deals that cap tariffs at lower levels than initially proposed. Stocks rebounded, with the S&P 500 (.SPX) , opens new tab soaring 27.2% from its April 8 close to its July 31 close, setting a series of new records. CoreData, however, found that 49% of institutions believe that markets now are too complacent about the impact of U.S. tariffs. U.S. consumer prices increased by the most in five months in June, according to Consumer Price Index data, suggesting that tariffs are boosting inflation. Other data points to a moderation in economic activity, and second-quarter growth was mainly strong because imports were weak. Global asset manager Man Group, which manages roughly $193 billion, is wary of overweighting U.S. assets. “This is an opportunity for investors to take some profits, rebalance and go to neutral on the U.S.," said Kristina Hooper, chief market strategist at Man Group. BEYOND TARIFFS The dollar's status as the global reserve currency may be in question as the U.S. forfeits the role of free trade facilitator, said Thierry Wizman, global FX and rates strategist at Macquarie Group, adding the firm expects to sell the dollar on any rally. After suffering its worst first-half performance since 1973 this year, the dollar posted its first monthly gains for 2025 in July, as investors regained confidence in the wake of trade deals. Also contributing to the reassessment of U.S. market supremacy is the risk of monetary policy being politicized. Trump has repeatedly called for lower interest rates and threatened to remove Federal Reserve Chair Jerome Powell. A recently approved tax and spending bill, meanwhile, will add trillions to the government's debt, exacerbating longstanding deficit concerns. Investors are likely to respond by seeking higher compensation for the risk of owning long-dated Treasury securities "There's very, very real risk that yields go significantly higher because of the deficit," said Man Group's Hooper. U.S. INNOVATION For many, the buoyant U.S. stock market and optimism surrounding the U.S. tech sector have made it hard to turn bearish. "The bottom line is that the U.S. has some of the most innovative and profitable companies in the world, and the deepest capital markets," said Kelly Kowalski, head of investment strategy at MassMutual. Anxiety about the demise of U.S. pre-eminence is "overblown," she said. Concerns over weaker foreign demand for U.S. debt have eased in recent weeks. After selling a net $40.8 billion of Treasuries in April, foreigners resumed buying to the tune of $146 billion in May, the latest government data showed. Also, while European stocks handily beat their U.S. counterparts in March, that gap has narrowed with every new trade deal announced. As of the end of July, Europe's STOXX 600 was roughly neck and neck with the S&P 500. "The big factor in the room has nothing to do with policies, but technology," said Richard Lightburn, deputy chief investment officer at macro hedge fund MKP Capital Management. "It still feels like early innings for AI adoption and integration." Anthony Saglimbene, chief market strategist at Ameriprise Financial, continues to recommend a slight overweight to U.S. stocks relative to other global markets. "Call it 'exceptionalism' or just 'clarity.' The macro environment in the U.S. is comparatively more stable." (This story has been corrected to change the company's name to State Street Investment Management, from State Street Global Advisors, in paragraph 5) https://www.reuters.com/business/never-mind-wall-street-records-investors-rethink-us-market-supremacy-2025-08-01/

2025-08-01 09:52

PARIS, Aug 1 (Reuters) - The trade deal between the European Union and the United States should not impact the business of French nuclear fuels company Orano, as so far the U.S. has not imposed tariffs on uranium products, its CEO Nicolas Maes told reporters on Friday. Under the deal announced last Sunday, the EU agreed to purchase nuclear energy products along with U.S. liquefied natural gas and oil worth in total $750 billion over the next three years. Sign up here. "We have looked at the material, and for all the deals that have been signed so far between the U.S. and other regions of the world, and isotopes, uranium, enriched uranium are exempted," Maes said. However, he said the deal's provision for exports of nuclear fuel from the U.S. to Europe was surprising, given that the U.S. is an importer, rather than exporter of the fuel it needs for its nuclear power plants. "The U.S. market is structurally importing nuclear material and not exporting," Maes said. He also said Orano's plans to expand the company's nuclear enrichment facilities in Oak Ridge, Tennessee, should not be affected by either the trade deal or U.S. President Donald Trump's executive order deregulating the nuclear sector. Trump signed an executive order In May to reduce regulations and fast-track new licences for nuclear reactors and power plants and reinvigorate uranium production and enrichment in the country. Maes said that Orano will maintain its nuclear safety standards but the order may result in easier dialogue between the nuclear safety authority and the utilities during the permitting process. He repeated an earlier comment that a final investment decision on the project is expected in 2027. https://www.reuters.com/business/energy/nuclear-fuels-producer-orano-does-not-expect-any-impact-eu-us-deal-2025-08-01/

2025-08-01 09:06

Aug 1 (Reuters) - As Donald Trump's latest round of tariff turmoil ripples through markets and the global economy, U.S. company results continue to trickle in, policymakers in Britain and Mexico decide on rates, and oil exporting countries meet to adjust output quotas. Here's your weekahead from Bill Schomberg and Karin Strohecker in London, Kevin Buckland in Tokyo and Alden Bentley in New York. Sign up here. 1/RESULTS AND REFINANCING A raft of bellwether blue chips are reporting to Wall Street with Caterpillar (CAT.N) , opens new tab due on Tuesday, then Disney (DIS.N) , opens new tab, and McDonald's (MCD.N) , opens new tab on Wednesday. All are in the Dow 30 index, which has been flirting with record highs. Beats or upbeat outlooks from these could help lift this bellwether over the line. It is the only benchmark that has yet to hit a new peak after April's tariff panic. Some data points will help gauge the health of the world's largest economy, with durable goods orders out on Monday, and the ISM services purchasing managers' index on Tuesday. Meanwhile, U.S. Treasury auctions for benchmark 10-year and 30-year bonds will show if strong demand seen in shorter-dated papers in recent days can be replicated further out the curve. 2/SLOWING STIMULUS It's been a challenge for Beijing: how do you stir animal spirits while pivoting the world's number two economy to one built on consumers instead of factories? Trade data on Thursday and inflation figures two days later will give the latest reading on how arduous the task remains. The numbers come on the back of a closely-watched Politburo meeting, where policymakers vowed a crackdown on crippling domestic price wars but not offering much concrete new stimulus - much to the chagrin of domestic investors. Analysts say that's a good thing, chalking up slowing support measures to a stronger-than-expected economy and smoother-than-anticipated tariff negotiations with Washington. Meanwhile, trade talks with the U.S. ended without a breakthrough though look on track for an extension to the August 12 deadline. 3/JOBS AND PRICES Rising inflation and falling employment will be at the heart of the Bank of England's conundrum when policymakers meet on Thursday to set interest rates. Analysts expect a quarter-point cut to 4% and another "gradual and careful" message about its following moves. Markets are pricing another cut before year-end and one more in 2026. But some analysts think the BoE might have to call a halt to the process perhaps as soon as next week, given the warning signals about inflation. Another three-way split among policymakers looks likely amid differences over which danger is most pressing. The BoE is expected to assess the impact of its push to run down government debt stockpiles ahead of a September decision on the pace of sales over the following 12 months. 4/TRADE AND RATES Mexico's central bank policymakers also meet on Thursday to decide on interest rates, and are expected to deliver another 25-basis-point cut to lower rates to 7.75% - which would be a three-year trough. But the outlook is clouded - minutes from the July meeting confirm a shift in the easing cycle, notably, policymakers pre-committing to more easing as they face persistent inflation and weak domestic demand. And the outlook for Mexico's trade relationship with its northern neighbour is adding to uncertainty. Mexican President Claudia Sheinbaum said on Thursday she secured a pause on new tariffs coming into effect and a 90-day period to work on a trade deal. 5/SECONDARY SANCTIONS The Organization of the Petroleum Exporting Countries and allies led by Russia are meeting on Sunday to decide on increasing oil output for September. Expectations are the group will raise output by 550,000 barrels per day in what would be its last move for now - though the decision comes at a delicate moment for energy markets. Analysts are trying to sift through the fog of what the economic impact - and change in crude oil demand - will be in the wake of Trump's tariff onslaught. Looming even larger is the question of secondary sanctions on Russian oil exports from Washington: Trump said on Monday that Russian President Vladimir Putin had only 10 to 12 days to reach a deal to end the war in Ukraine before Washington would impose such curbs, short circuiting the previous 50-day timeframe set on July 14. https://www.reuters.com/business/take-five/global-markets-themes-graphic-2025-08-01/