Weekly market commentary

Market review

Global stocks rose over the week, led by the US. Equity markets were supported by strong US labour market data and positive developments on the US trade front. We also saw inflation data from Europe, the passing of Trump’s ‘Big Beautiful Bill’ and concerns over the UK’s spending plans.

The 9 July tariff deadline is fast approaching, which marks the end of the 90-day delay to the tariff rates Trump announced in early April. Developments have been positive over the week with Vietnam agreeing a 20% tariff rate on its exports into the US and Treasury Secretary Bessent stating that the US is very close to a deal with India. Meanwhile the EU is willing to accept the 10% universal tariff but wants the US to commit to lower rates on key sectors such as pharmaceuticals, alcohol, semiconductors and commercial aircraft. Sentiment did mellow towards the end of the week after Trump stated that the US will begin sending out letters to trading partners setting out tariff rates ahead of the 9th July deadline.

The US labour market saw signs of strength. The number of US job openings rose 374,000 in May to 7.769 million, the highest level since November 2024 and well above expectations of 7.3 million. Meanwhile US nonfarm payrolls showed jobs increased by 147,000 in June which was above expectations of a 110,0000 rise. Positive trade and US labour market news pushed equity markets higher over the week. The strong jobs numbers also reduced market expectations of a US interest rate cut in July from 25% to a 5% chance.

US President Trump’s ‘Big Beautiful Bill’ was passed in the House by a 218-214 vote on Thursday, just in time for US Independence Day. The bill extends the tax cuts implemented in Trump’s first term, increases spending on border security and the military, while slashing funding for health-care programs, food assistance and clean energy projects. The Congressional Budget Office estimates the bill will increase deficits over the next 10 years by $3.4 trillion. The debt ceiling was also increased by $5 trillion which takes worries about the US hitting its self-imposed debt limit off the table for a few years.

Euro Area headline consumer price inflation came in at 2% year-on-year in June which was in line with expectations and the European Central Bank’s (ECB) target of 2%. The market still expects the ECB to cut interest rates one more time this year.

Outlook

The economic environment has remained resilient, but rising geopolitical tensions and trade uncertainty may begin to weigh on sentiment. The recent tensions between Iran and Israel has heightened global risk, while the 9 July tariff deadline is fast approaching. Markets remain sensitive to further developments.

Movers table