Trade Secrets

WTF Dailies July 8, 2025

US stock futures fell as President Trump threatened stiff tariffs on imports from more than a dozen countries and delayed the return of sweeping April levies.

Sage Kakkat

07 Jul 2025 — 6 min read

US stock futures fell as President Trump threatened stiff tariffs on imports from more than a dozen countries and delayed the return of sweeping April levies.
On Monday, stocks fell as Trump posted to Truth Social letters addressed to the leaders of 14 countries threatening 25% to 40% tariffs starting August 1. Key US trading partners Japan and South Korea were among the group, as well as Malaysia, South Africa, and Indonesia.
The president also signed an Executive Order Monday officially moving his July 9 deadline for the resumption of "Liberation Day" tariff rates to August 1.
In an early response to a tariff letter, South Korea said it would kick trade negotiations with the US into high gear, adding that it considered the new date an extension of a grace period.
Asian stocks were strong despite a weak overnight lead-in from Wall Street, as Trump began sending letters to major economies outlining U.S. tariffs against them. But the president extended his deadline to impose his tariffs to August 1 from July 9, and also signaled that he remained open to talks.
South Korea’s KOSPI rose 0.7% on Tuesday, while Japan’s Nikkei 225 index curbed early gains to trade flat. The TOPIX index fell slightly. The KOSPI was boosted by an over 2.5% jump in memory chip giant SK Hynix Inc, which rose after rival Samsung Electronics Co Ltd forecast a substantially weaker than expected operating profit for the second quarter.
Malaysia will also face a 25% tariff, while Thailand was slapped with a 36% levy. Indonesia faces 32% tariffs. Malaysian stocks fell 0.7%, while Indonesian stocks shed 0.2%.
The tariffs will be effective from August 1, Trump said, pushing forward an earlier July 9 deadline. But the president later told reporters that he was not a “100% firm” on the August 1 deadline, and that he was open to alternate proposals amid ongoing trade talks.
Other Asian stocks were upbeat on this notion. China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes rose 0.3% and 0.2%, respectively, while Hong Kong’s Hang Seng index rose 0.3%.
Singapore’s Straits Times index added 0.1%.
Gift Nifty 50 Futures for India’s Nifty 50 index rose 0.1%, pointing to a positive open for the index. Focus was also on a New Delhi-Washington trade deal, which the White House said was close.
Australia’s ASX 200 index fell 0.1%, with focus squarely on the RBA’s rate decision.The central bank is widely expected to cut interest rates by 25 basis points to 3.60%, its third such cut this year after it began an easing cycle in February.
Expectations for a cut were furthered by signs of cooling Australian inflation and economic growth, especially in the face of increased trade headwinds. But Westpac analysts warned that a July rate cut might not be as confirmed as markets were expecting, especially amid heightened uncertainty over the global economy.

Market Close

US large cap equities were mostly lower today, with the S&P 500 large cap index down 0.1%, the Dow Jones falling 0.4% and the NASDAQ broadly flat . Small cap stocks were the best performers, with the Russel 2000 index up 0.8% . This followed a mixed tone in overnight equity markets, with major Asian indexes up, but European markets struggling.
Bonds sold off globally, in a move that looks to have originated in Japan as markets fret over the implications of the upcoming election for the fiscal outlook. However, US Treasuries pared losses late in the trading session to leave yields broadly unchanged over the day.
Finally, oil is up 0.5%, the dollar appreciated by 0.4% against a trade weighted basket of currencies, and copper futures spiked nearly 10% to new record highs after the President threatened to increase tariffs.
The Trump administration announced new reciprocal tariff rates for many of its major trading partners yesterday and warned today that if trade deals cannot be agreed then these would be strictly enforced at the August 1st deadline.
The President also announced an intention to raise tariffs on copper imports to 50%, albeit without specifying when this new rate would go into effect. Chile is by far the largest exporter of copper to the US, although Canada accounts for around 15% of imports.
Finally, Trump warned that pharmaceutical tariffs could spike as high as 200% unless companies start producing these products in the US over the next 18 months. The renewed headlines around tariffs have shifted market attention back to trade policy and could cause spikes in volatility over the summer.
Markets will have limited macro data to digest this week, with the minutes from the June Federal Reserve Bank meeting, released Wednesday, and initial unemployment insurance claims, due Thursday, the highlights.
Today's NFIB small business sentiment survey showed a small decline in confidence as firms penciled in a more cautious outlook for sales and hiring. At the same time, a greater share of small business owners are signaling an intention to raise prices, likely reflecting the impact of tariff increases already put in place.

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