Trump’s Tariff Ultimatum Hits Global Trade 08/07/2025

HOT stories for today

US market wrap:

• Markets closed lower Monday amid renewed trade tension: the Dow fell 0.94%, the S&P 500 lost 0.79%, and the Nasdaq dropped 0.92%. President Trump reiterated Sunday that tariffs on nations without finalized trade deals will take effect on August 1. He also ordered formal letters to be sent to U.S. trade partners, including Japan, warning that “reciprocal” tariffs are forthcoming, targeting sectors such as autos and agriculture.
• Japanese officials expressed concern but stopped short of confirming a response. TSLA (-6.79%) also weighed on sentiment after investors reacted to Elon Musk’s continued political entanglements, raising fears of further reputational and operational risks. Meanwhile, bond yields remained soft, and the dollar remained stable as markets await the Fed minutes later this week.

Trump’s Tariff Ultimatum Hits Global Trade

• President Trump announced that 14 nations, including Japan, South Korea, and South Africa, will face sharply higher U.S. import tariffs starting August 1 unless trade deals are reached. In a series of social media posts, he shared form letters sent to leaders of these countries, outlining tariffs ranging from 25% to 40%. The tariffs will affect key sectors like autos, electronics, and textiles.
• The letters also warned against retaliatory tariffs, promising reciprocal increases if other nations respond in kind. While citing ongoing trade deficits as justification, Trump hinted that tariffs may be adjusted “depending on our relationship with your country.” Although initial duties were paused in April, only a few frameworks, such as with Vietnam and the UK, have materialized. The White House confirmed on Monday that the original July 9 deadline has been delayed to August 1, allowing more time for negotiations.

Stocks on the move:

• Uber Technologies (UBER): rose 3% Monday, hitting a record high of $97.12. The ride-hailing firm is now up nearly 60% year-to-date, supported by strong demand and improved profitability.
• SolarEdge Technologies (SEDG) declined roughly 3% after a 39% surge last week. While the removal of clean energy taxes from Trump’s spending bill boosted the stock, the same law also cut federal support for solar and wind initiatives.
• CrowdStrike (CRWD): dropped over 2% following a downgrade from Piper Sandler to neutral from overweight. The firm cited valuation concerns after a significant rally; shares are still up more than 46% in 2025.
• MP Materials (MP): The stock slipped nearly 4% after Jefferies downgraded it to "hold" from "buy." The firm raised its price target to $33 but noted that China’s shift to short-term export licenses reduces the likelihood of near-term supply disruptions.

Watchlist: TSLA, META, AMZN, NVDA, UBER, CRWV, PLTR, SOUN

Today’s action

• Asia-Pacific equities fluctuated on Tuesday as traders weighed U.S. President Donald Trump’s renewed tariff threats targeting 14 nations. Japan’s Nikkei 225 inched up 0.29%, while the broader Topix index ended little changed. South Korea’s Kospi climbed 1.47%, with the Kosdaq index rising 0.46%. On the mainland, China’s CSI 300 index rose 0.74%, and Hong Kong’s Hang Seng Index gained 0.8%.
• U.S. stock futures were mixed early Tuesday following Trump’s announcement of fresh tariffs and his decision to push the “reciprocal” tariff implementation to August 1. Dow Jones futures slipped 49 points, or 0.11%, S&P 500 futures were flat, and Nasdaq 100 futures edged up 0.17%. The week is expected to be relatively quiet on the economic data front, except for Wednesday’s release of the FOMC meeting minutes, which could offer clues on the Federal Reserve’s next policy move.

Bitcoin

• Bitcoin (BTC) traded in a tight range between $107,942 and $109,717 on Monday, holding near $108,800 as bulls and bears battled for control below the key $ 110,000 level. Despite macroeconomic headwinds, risk sentiment remained resilient amid ongoing U.S. dollar weakness and broader market stability.
• Funding rates are falling even as prices climb, hinting at a possible short squeeze. Meanwhile, sentiment remains frothy, with the Crypto Fear & Greed Index flashing “extreme greed,” suggesting growing investor complacency.
  Watchlist: BTC: 99,000–112,000 | ETH: 2,000–2,800 | SOL: 140–183

Forex

• The euro edged down to 1.1760 early Monday as global trade tensions weighed on sentiment. U.S. Treasury Secretary Bessent warned that countries failing to finalize trade deals may face renewed tariffs, casting a shadow over eurozone export prospects.
• USD/JPY rose above 145.30 as soft Japanese wage data and Trump’s threats of tariffs on Japanese goods, including rice, kept pressure on the yen. With Fed-BoJ policy divergence intact, the greenback gained further traction.
  Watchlist: EUR/USD: 1.1000–1.1850 | USD/JPY: 140–162

Basic Materials

• Gold (XAU/USD) slipped to $3,285 in early trade, pressured by a firmer U.S. dollar and fading safe-haven demand. However, concerns over the long-term fiscal impact of Trump’s tax plans and mounting geopolitical risks may offer downside protection.
• WTI crude hovered near $64.80 after OPEC+ confirmed plans to raise production by 548,000 barrels/day in August. Traders are assessing how supply increases will weigh against potential demand risks and escalating trade disputes.
  Watchlist: Gold: 2,600–3,500 | US Oil: 55.60–75.80

Economic Calendar (EST):

06:00 am: USD NFIB Small Business Index
03:00 pm: USD Consumer Credit

Earnings:

Today: No major earnings


The TEFS Analyst team wishes you a successful day!