Weekly Outlook
What Happened This Week?
- China's manufacturing activity shrank for a third straight month, battling deflation despite Beijing's attempts to stabilize parts of the industrial sector.
- German inflation continued to slow down in June. Headline inflation dropped to 2.0% year-on-year (from 2.1% in May), and core inflation also eased to 2.7% (from 2.8% in May).
- Japanese factory output increased by 0.5% in May, rebounding from an 1.1% decline in April. However, tariffs are now clouding the outlook for industrial production.
- U.S. stocks are ending a historic and volatile quarter at record highs. Despite a sharp drop in April that nearly pushed the S&P 500 into bear market territory, the index has rebounded strongly. Since President Trump’s tariff announcement, the S&P 500 has gained over 8% by the end of June.
- Gold prices have jumped more than 25% over the past six months by the end of June. This marks gold’s strongest half-year performance since late 2007. In Q2 2025, gold also reached new record highs above $3,499.
- Eurozone inflation saw a slight increase to 2% in June, according to Eurostat's flash data. This figure aligns with the European Central Bank's 2% target. Meanwhile, core inflation remained unchanged at 2.3% in June.
- At the ECB Forum on Central Banking, Federal Reserve Chair Jerome Powell stated that the U.S. central bank would have already eased monetary policy if President Donald Trump's tariff plan hadn't been in place.
- US manufacturers are still struggling with rising costs and weaker demand, even after some tariff reductions. The manufacturing slump shows little sign of ending, according to the ISM still below 50, as trade wars continue.
- The US May JOLTS report showed job openings rising to 7.8 million from 7.4 million in April. However, despite this increase, underlying demand for new workers is likely still declining due to growing consumer spending weakness. This trend should help to counteract inflationary pressures from tariffs in the coming months.
- Australian retail sales rose by 0.2% month-on-month in May 2025, representing a 3.3% increase compared to May 2024.
- The private sector lost 33,000 jobs in June, even though annual pay increased by 4.4%, according to the latest ADP report. This drop was due to companies being hesitant to hire and reluctant to replace departing staff.
- In Switzerland, the Consumer Price Index (CPI) rose by 0.2% in June 2025 compared to May. Annual inflation stood at 0.1% for the same period.
- June's overall employment data appeared encouraging, with nonfarm payrolls increasing by 147,000 and the unemployment rate falling to 4.1%. However, a closer look reveals a cooling labor market, as the breadth of hiring remained quite narrow. Still, the report should encourage the Fed in its summer pause.
- US services sector activity expanded in June, rebounding after a single month of contraction.
- Canada's goods trade deficit narrowed in May, dropping from a record high in April, largely due to a significant increase in volatile gold shipments and decreased trade activity with the U.S. as fluctuating tariff policies continue to impact cross-border flows.
- Bank of Japan Governor Kazuo Ueda stated that the BOJ's key interest rate remains below neutral. Meanwhile, Bank of England Governor Andrew Bailey indicated that the "direction of interest rates continues to be downwards." And the Fed confirmed its wait-and-see approach.
- On Thursday, the House passed President Trump's "big, beautiful" tax and spending bill.
This Week’s Market Movers
Forex
- The EUR/USD is trading at its highest level since September 2021.
- The USD/CHF is trading at its lowest level since August 2011.
- The AUD/USD is moving above the Ichimoku cloud on the weekly chart for the first time since November 2024.
Commodities
- Oil prices rose slightly in early Asian trading today after the U.S. moved to restrict Iranian oil trade. On Thursday, the Treasury Department sanctioned networks involved in Iranian oil, and the State Department announced sanctions against Iranian oil smugglers.
- Natural gas prices are down more than 8%.
- Oat prices are up more than 7%.
- Orange juice prices are down for the 5th week in a row.
- Coffee prices are down for the 4th week in a row.
Indices
- The S&P 500 gained 0.8% Thursday, hitting its fourth record high in five days and seventh this year.
- The Nasdaq Composite also hit a new record high, its fourth so far this year.
Shares
Tops
- Nike: +24.09%
- Datadog: +18.12%
- First Solar: +18%
- Royal Caribbean Cruises: +17.15%
- Carnival Corporation: +16.55%
- JD Sport Fashion: +15.52%
- Hewlett Packard: + 14.76%
- Norvegian Cruise Line: +14.24%
- Embraer: +14.12%
- Moderna: +12.72%
- Kering: +11.87%
Flops
- Natura: -72.91%
- Centene: -38.10%
- Molina Healthcare: -19.06%
- Vamos: -16.08%
This Week’s News to Follow
Tuesday 08 July
- 01:30 AM - Australian NAB Business Confidence (June)
- Previous: 2
- Forecast: -5
- 04:30 AM - Australian RBA Interest Rate Decision
- Previous: 3.85%
- Forecast: 3.60%
- 06:00 AM - German Balance of Trade (May)
- Previous: €14.6B
- 02:00 PM - Canadian Ivey PMI s.a (June)
- Previous: 48.9
- Forecast: 49
Wednesday 09 July
- 01:30 AM - Chinese Inflation Rate YoY (June)
- Previous: -0.1%
- Forecast: -0.3%
- 06:00 PM - American FOMC Minutes
Friday 11 July
- 06:00 AM - UK GDP MoM (May)
- Previous: -0.3%
- 12:30 PM - Canadian Unemployment Rate (June)
- Previous: 7.0%
- Forecast: 7.0%
Major Earnings Reports to Watch
Tuesday 10 July
- Delta Air Lines
Source: Trading Economics, TradingView, and ActivTrades’ Data as of July 4 2025
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