June 30th, 2025
Markets opened the holiday-shortened week with record territory in view, fueled by growing hopes that the U.S. and key trading partners are nearing agreements to roll back broad tariffs enacted under President Trump.
U.S. stocks gained on Monday but gave up some earlier momentum, as optimism around trade negotiations lifted markets and positioned major indexes for potential new record highs—capping off one of the most turbulent first halves of any year in recent memory.
The Dow Jones Industrial Average (^DJI) rose around 0.4%, while the S&P 500 (^GSPC) and the Nasdaq Composite (^IXIC) each advanced about 0.4%. The tech-heavy Nasdaq was buoyed by intraday record highs from Microsoft (MSFT) and Meta (META).
Overseas markets were mixed overnight. In Asia, stocks saw uneven performance after China’s manufacturing Purchasing Managers’ Index (PMI) inched up in June but stayed in contraction for the third straight month, as anticipated. In Europe, markets traded broadly lower despite Germany’s CPI inflation slowing to an annualized 2.0% in June—matching the European Central Bank’s target.
Economic Takeaways:
- The market has fully recovered the tariff-driven losses from March and April, rebounding to new highs on Friday in just 55 days.
- The U.S. dollar weakened against major global currencies.
- Bond yields are lower this morning, with the 10-year Treasury yield at 4.26%. The benchmark yield has pulled back from its May peak near 4.60%.
- WTI crude oil prices declined amid easing geopolitical tensions in the Middle East and expectations of potential supply increases ahead of the OPEC+ meeting scheduled for July 6.
- Bloomberg reported that Trump threatened a 25% tariff on Japanese cars and that France is confident the European Union can make a deal with the U.S. before the July 9 deadline.
- The administration has indicated it might extend its July 9 deadline for countries negotiating “in good faith,” but that’s a judgment call and investors have little insight into negotiations. “
- Recent data suggest a slowdown in growth following the pre-tariff surge in spending, as reflected by the Atlanta Fed’s GDPNow model, which lowered its estimate for second-quarter GDP growth to 2.9% on Friday, down from 3.4%.
- The Senate is moving towards a final vote on the “One Big Beautiful Bill.”
- Bitcoin (/BTC) edged up 0.7%, with crypto-linked stocks Coinbase (COIN) and MicroStrategy (MSTR) each rising about 1%. This followed the FHFA’s directive for Fannie Mae and Freddie Mac to begin preparing to consider crypto assets in single-family mortgage risk assessments.
- Despite broader market gains, the Cboe Volatility Index (VIX) rose nearly 5%, signaling increased uncertainty. Typically, a rising VIX alongside climbing stock prices can foreshadow a pullback.
- As of early Monday, the CME FedWatch Tool placed the odds of a July interest rate cut at 21%, while the chance of at least one cut by September stood at 93%.
- With one trading day left in June, the S&P 500 is up 4.4% for the month, the Nasdaq Composite has gained nearly 6.1%, and the Dow Jones Industrial Average is ahead by 3.7%.
Trump Threatens Japan Tariff, Hassett Says Deals Expected After July 4
President Donald Trump has threatened to impose a new tariff level on Japan, while his top economic adviser, Kevin Hassett, said the administration plans to finalize trade agreements with key partners following the July 4 holiday.
Trump’s latest confrontation with Tokyo came Monday, just over a week ahead of a July 9 deadline, after which higher tariffs could resume for multiple trading partners, including Japan. The president cited Japan’s refusal to accept U.S. rice exports as the reason behind the threat.
“They won’t take our RICE, and yet they have a massive rice shortage,” Trump wrote on social media. “In other words, we’ll just be sending them a letter, and we love having them as a Trading Partner for many years to come.”
For weeks, Trump has been applying pressure on trade partners in the run-up to the deadline, warning that he would cut off negotiations with those he views as uncooperative and instead issue formal letters outlining new tariff rates.
Trump Sends Powell Signed Chart Urging Rate Cuts: ‘You Have Cost the USA a Fortune’
President Donald Trump escalated his pressure campaign on Federal Reserve Chair Jerome Powell by sending him a signed chart urging lower interest rates, accompanied by a pointed message.
In a post on Truth Social, Trump once again criticized Powell and the Federal Reserve, writing that the Fed and its Board of Governors “should be ashamed of themselves for allowing this to happen to the United States.”
Trump reiterated his call for the Fed to cut interest rates to 1%. The central bank earlier this month maintained its benchmark rate in the range of 4.25% to 4.5%.
Included in Trump’s post was a signed chart comparing global central bank interest rates, highlighting nearly three dozen central banks with rates below the Fed’s.
White House press secretary Karoline Leavitt confirmed during a Monday press briefing that Powell had indeed received the signed table.
On the Move
- Microsoft (MSFT) and Meta (META) touched fresh all-time highs on Monday as Big Tech companies led modest gains.
- Nike (NKE) dipped early Monday but surged 15% on Friday after delivering slightly better-than-expected earnings and offering a reassuring outlook that calmed investor concerns.
- In the solar sector, Enphase (ENPH) fell nearly 2% and SolarEdge (SEDG) edged lower in pre-market trading after the latest version of the Senate’s budget bill proposed phasing out tax credits for solar by the end of 2027. However, Sunrun (RUN) jumped 6% on optimism that rooftop solar could still benefit from extended incentives. First Solar (FSLR) rose 8% as the bill included new taxes on Chinese-made solar components. Continued budget negotiations in Congress could keep the sector volatile.
- Hewlett Packard Enterprise (HPE) spiked 15%, and Juniper Networks (JNPR) gained 8.5% in pre-market trading following a report from Barron’s that the Justice Department had resolved a legal challenge to HPE’s $14 billion acquisition of a wireless networking firm.
- Moderna (MRNA) climbed over 4.5% pre-market after reporting positive Phase III results for its flu vaccine, potentially opening the door for a combined flu-Covid shot.
- Nvidia (NVDA) nudged higher after notching another record high on Friday, though a Financial Times report revealed insiders had sold $1 billion in stock over the past year.
- Walt Disney (DIS) advanced 1.8% in early trading following an upgrade to Buy from Jefferies, which cited lower risks to theme park demand and upside in its cruise business.
- Tesla (TSLA) slipped 1% amid concerns over proposed cuts to clean energy credits in the budget bill. Investors are awaiting Tesla’s delivery numbers due Wednesday.
- Palantir (PLTR) rose 4% before the bell after announcing a new partnership with Accenture (ACN) to deliver AI-powered solutions for federal agencies.
What’s Ahead
Fed Chairman Jerome Powell participates in a panel discussion early tomorrow. Constellation Brands (STZ) will also report its earnings.
Expected economic data includes the June ISM Manufacturing PMI and May Job Openings as well as the Labor Turnover Survey (JOLTS).
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