Trade Secrets

WTF Dailies July 3, 2025

The June jobs report, set for release Thursday, is expected to end the holiday-shortened week with a bang. Any labor market weakness will be closely watched as it could strengthen the case for an interest rate cut from the Federal Reserve sooner rather than later.

Sage Kakkat

02 Jul 2025 — 6 min read

US stock futures held steady as an upbeat Wall Street braced for the release of the June jobs report. Futures attached to the Dow Jones Industrial Average, the benchmark S&P 500, and the tech-heavy Nasdaq 100vticked up 0.1%.
President Donald Trump said on Wednesday that the U.S. has reached a trade agreement with Vietnam, notching a third deal ahead of the July 9 deadline. Trump had said he won’t extend the deadline, signaling that if no deal is reached by then, affected nations will receive formal letters outlining the tariff rates they will face. With less than a week until the deadline, the U.S. has secured just three trade deals— with the UK, China, and Vietnam.
Trump's major spending bill stalled in the House after passing the Senate on Tuesday. House Speaker Mike Johnson said he aims to pass the legislation by Friday, July 4.
The June jobs report, set for release Thursday, is expected to end the holiday-shortened week with a bang. Any labor market weakness will be closely watched as it could strengthen the case for an interest rate cut from the Federal Reserve sooner rather than later. Recent signs of a softening in the labor market have given investors a new wave of confidence that a cut could be imminent. Trump's ongoing feud with Federal Reserve Chair Powell —particularly reports he may announce a successor early — have further raised hopes for a reduction in rates.
Trading will end early on Thursday at 1 p.m. ET for the July Fourth holiday.
Asian stock markets struggled for direction on Thursday as investors awaited progress on U.S. trade deals ahead of the July 9 deadline, while they assessed China’s services data and Australia’s trade balance figures.
Markets across the globe turned cautious ahead of the U.S. jobs report, due later in the day, which could provide insights on the Federal Reserve’s interest rate outlook.
Most regional markets were subdued, with investors wary of Trump’s shifting positions ahead of the looming deadline.
Japan’s Nikkei 225 edged 0.2% lower on Thursday, after steep losses in the previous two sessions. The broader TOPIX index fell 0.2%.
Hong Kong’s Hang Seng index led losses with a 1.2% drop. In contrast, South Korea’s KOSPI rose 0.6%, while the Philippines’ PSEi Composite jumped 1%.
Elsewhere, Singapore’s Straits Times Index was largely muted, while futures tied to India’s Nifty 50 edged up 0.1%.
Data on Thursday showed that Australia’s trade surplus narrowed sharply above expectations in May, reaching its lowest since November 2019. Weak global demand weighed on exports while imports rebounded from the previous month’s decline.
Australia’s S&P/ASX 200 index fell 0.6%.
In China, data showed that the country’s services sector grew less than expected in June, expanding at the slowest pace in nine months. China’s Shanghai Composite index fell 0.1%, while the Shanghai Shenzhen CSI 300 gained 0.2%.
Nifty50 and BSE Sensex, the Indian equity benchmark indices, started trade on a flat note on Thursday. While Nifty50 was above 25,500, BSE Sensex was in red. At 9:18 AM, Nifty50 was trading at 25,512.65, up 59 points or 0.23%. BSE Sensex was at 83,628.19, down 69 points or 0.083%.

Market Close

Markets delivered strong gains in today's holiday-shortened trading session after a better-than-expected June U.S. labor report. Major U.S. large- and small-cap indexes jumped between 0.75%-1.0% over the day, while Canadian equities were also up, albeit by a more moderate 0.5%. Meanwhile, traders trimmed expectations for Fed easing this year in the wake of this data, with 51 basis points (0.51%) of easing now priced over this year in total, compared with 65 basis points at close of play yesterday. This shift appears to be driving a broader sell-off in Treasury markets, with the 2-year yield up 10 basis points and the 10-year yield up 6 basis points at market close. Finally, the trade-weighted dollar staged a modest rally, rising 0.45% on the day, helped by reassuring economic data and an increase in domestic interest rates.
The headlines from the June labor report were stronger than expected. A headline increase in payrolls of 147,000 over the month, coupled with net upward revisions of 16,000 to the past two months of data, help provide some reassurance that firms continue to hire amidst elevated trade-policy uncertainty. At the same time, the headline unemployment rate fell to 4.1%, in contrast to expectations for a rise to 4.3%. However, there were a couple of softer spots in the report. First, the decline in unemployment was in part caused by workers leaving the labor force, with the participation rate falling again in June. Second, job growth in June was flattered by a large gain in public-sector jobs, with private hiring weaker at 74,000. Still, these data are not consistent with any abrupt slowdown in the economy, and they help support the Fed's patient approach to cutting interest rates.
The House of Representatives sent Donald Trump's "Big, Beautiful Bill" to the president for his signature Thursday after a record-setting and emotional debate over a piece of legislation that will be felt across the economy for years to come. The final vote was 218-214, with just two Republicans voting no in the end. House Speaker Mike Johnson whittled down a list of over two dozen GOP holdouts who were objecting to the bill as recently as Wednesday to just Reps. Thomas Massie of Kentucky and Brian Fitzpatrick of Pennsylvania. White House Press Secretary Karoline Leavitt quickly announced after the vote ended that Trump would sign the bill on Friday at 5 p.m. ET at a White House ceremony, adding "this bill is going to create an economic boom for the United States of America."

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