Morning in New York: US foreign trade policy in the spotlight

Daily review and forecast of events on the US stock market from Mikhail Denislamov, Deputy Director of Freedom Capital Markets Research.

The US foreign trade policy remains in the center of attention of the investment community. This week, the White House plans to expand the list of countries that have received letters notifying them of the new tariffs, the introduction of which has been postponed until August 1. Washington stresses that the negotiations are aimed at reaching the most favorable terms for the States, with several agreements close to finalization. The EU, according to media reports, is seeking to renegotiate relevant agreements with the US as soon as possible to fix duties at 10%.  

Against the backdrop of Donald Trump's threats to raise tariffs by another 10% for countries that support the "anti-American course" of BRICS, investors do not rule out further escalation of tensions. At the same time, quotations do not yet include a sharp return of duties to the barrier levels announced by the White House on April 2. This reflects cautious optimism about the conclusion of new trade agreements in the coming months. Increased volatility is likely in the current situation. U.S. foreign trade policy will remain one of the main drivers for U.S. equities through the summer;

The main event on the macroeconomic calendar this Tuesday will be the publication of the NFIB Small Business Optimism Index for June. It is expected a slight increase in the index from the previous mark of 98.8 points, which will indicate the continued confidence of entrepreneurs in the stability of the sector. Additional support for these expectations is provided by the NFIB employment report published on July 2, which showed a slight increase in the share of small business owners planning to expand their workforce in the next three months. Investors will also be interested in the updated data on consumer inflation expectations from the Federal Reserve Bank of New York for June. This statistic will allow to assess the mood of households and the risks of price pressure in the second half of the year;

Futures on S&P 500 shows consolidation. For the upcoming session, we forecast an average level of volatility with a neutral balance of risks. We focus on S&P 500 movements in the range of 6170-6290 points (from -1% to +1% relative to the closing level of the previous session);

- Shares of Merit Medical Systems (MMSI) are up 4.8% in the postmarket after announcing plans to change its CEO and amid the release of preliminary second-quarter earnings data. 

- Biogen (BIIB) will include $46 million in pre-tax charges for acquired R&D and milestone payments in its April-June financial statements. As such, its net income per share will decrease by $0.26. 

- Biosig Technologies (BSGM), following its merger with Streamex Exchange, has signed an agreement to raise up to $1.1 billion to invest in gold and bring real assets such as commodities onto blockchain. The issuer's shares are up more than 30% on the news.  

July 7 trading on the U.S. stock exchanges ended in the red zone. S&P 500 and Nasdaq 100 lost 0.79% each. The Dow Jones fell 0.94%, the Russell 2000 fell 1.55%. Shares of the Magnificent Seven, with the exception of Amazon (AMZN), showed negative dynamics. Almost all sectors included in the broad market index closed in the negative. Only the utilities industry (XLU: +0.21%) showed moderate growth, and the list of outsiders was headed by durable goods manufacturers (XLY: -1.27%).  

Pressure on quotations was exerted by the news of the White House's intention to impose a 25% tariff on imports from Japan and South Korea from August 1, as well as the announcement of the planned increase in duties for South Africa, Indonesia and Malaysia. Japanese Prime Minister Shigeru Ishiba called Washington's move "really regrettable" but emphasized his willingness to continue dialogue. Seoul also promised to intensify talks. Donald Trump, in turn, made it clear that he remains open to discussing the terms and that the deadline for imposing duties (August 1) "is not 100% final."

Market participants prefer to be cautious, given that the US has so far concluded full-fledged agreements only with the UK and Vietnam, and uncertainty about the rest of the partners increases volatility and heightens concerns about the stability of global supply chains;

- Oracle (ORCL: -2.1%) shares fell on news of a 75% discount on software to the federal government, as well as significant discounts on cloud services. 

- CoreWave (CRWV: -3.3%) is buying Core Scientific (CORZ: -17.6%) for $9 billion ($20.4 per share). The company's future shareholders will receive CRWV's equity securities as payment, meaning the return on the sale is directly tied to the performance of those securities. The transaction is scheduled to be completed in the fourth quarter;

- Quotes of Rocket Lab (RKLB: +9%), one of SpaceX's main competitors, are reacting positively to the escalating conflict between Donald Trump and Ilon Musk. 

- Tesla (TSLA: -6.8%) shares came under pressure after sharp criticism from the president related to Musk's America Party initiative and amid reports of market share declines in China. 

This article was AI-translated and verified by a human editor