US Markets Saw Some Gains Yesterday 

Wall Street closed with modest gains on Monday as investors navigated renewed trade tensions between Washington and Beijing. The S&P 500 rose 0.41% to 5,935.94, and the Nasdaq Composite advanced 0.67% to 19,242.61, buoyed by strength in the technology sector. The Dow Jones Industrial Average inched up 0.08% to finish at 42,305.48. The session was marked by caution ahead of key U.S. employment data and a widely anticipated interest rate cut by the European Central Bank.

Dollar Weakens as Global Trade Tensions Escalate

The U.S. dollar retreated sharply. It weighed down by rising uncertainty over President Trump’s trade policies. The dollar index dropped 0.69% to 98.67, while the euro strengthened to $1.1444, and the yen appreciated to 142.7 per dollar.

Longer-dated U.S. Treasury yields edged higher, with the 10-year yield climbing to 4.45% and the 30-year reaching 4.98%, as markets assessed the inflationary risks stemming from Trump’s planned tariff hike on steel and aluminum.

Trump’s Tariff Threat and Global Market Reaction

Tensions intensified after U.S. Treasury Secretary Scott Bessent said President Trump would soon speak with Chinese President Xi Jinping to address issues over a disputed tariff rollback deal. Trump accused China of breaching the agreement, prompting Beijing to label the claim “groundless” and promise a forceful response.

Trump’s announcement to double tariffs on imported steel and aluminum to 50% from Wednesday sparked backlash from the European Union. This pushed European stocks down. The pan-European STOXX 600 fell 0.14%, and the FTSEurofirst 300 dropped by a similar margin.

Weak Economic Data Adds to Investor Caution

Economic indicators added to the market’s cautious tone. The U.S. manufacturing sector contracted more than expected in May, according to the Institute for Supply Management. Additionally, construction spending declined in April, contrary to forecasts.

Commodities and Safe-Haven Assets Climb

Oil prices surged as OPEC+ maintained July production levels and wildfires in Canada’s oil-rich regions threatened supply. U.S. crude jumped 2.85% to $62.52 per barrel, and Brent crude rose 2.95% to $64.63.

Gold prices also rallied on safe-haven demand, reaching a one-week high. Spot gold climbed 2.77% to $3,380.41 an ounce. Copper and aluminum prices rose 1.23% each.

Global Market Performance

Global equities showed mixed reactions. While the MSCI All-Country World Index rose 0.38%, emerging market stocks slipped 0.32%, and Japan’s Nikkei fell sharply by 1.30%. In Poland, the WIG20 index declined 0.6% following a nationalist opposition win in the country’s presidential election.

As global trade policies remain in flux and geopolitical risks escalate, market participants are likely to remain on edge, watching closely for developments from both the U.S. and China.

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