Daily market snapshot

Published July 7, 2025
 Woman on couch looking at laptop

Monday, 07/7/2025 p.m.

  • Stocks open mixed as market awaits trade announcements – The TSX is trading higher, while U.S. equity markets are down on Monday to start a quiet week for new economic data. Industrial stocks are posting gains, while the consumer discretionary and consumer staples sectors are lagging. In international markets, Asia finished mixed overnight, while Europe is up as Eurozone retail sales growth cooled to 1.8% annualized in May, ahead of estimates for a sharper slowdown.* The U.S. dollar is advancing against major international currencies. In commodity markets, WTI oil is trading higher despite OPEC+ hiking output more than expected at its July 6 meeting.*br>  
  • Trade remains in focus – President Trump announced that new trade agreements or tariffs will be announced by July 9, with some to be released as soon as today.* For countries not reaching trade deals, new tariffs will be applied on August 1, which is an extension from the previously-announced July 9 end to the 90-day pause. Trump also announced separately that countries aligning with certain policies of the BRICS bloc of developing countries would face an additional 10% tariff. BRICS countries, which include Brazil, Russia, India, China and South America, are currently meeting for a two-day summit in Brazil. We believe additional clarity on outcome of trade negotiations should reduce uncertainty, though the resumption of higher tariffs could raise inflation and growth concerns. 
     
  • Bond yields tick up – Bond yields are higher, with the 10-year Government of Canada yield at 3.37% and the 10-year U.S. Treasury yield at 4.37%. The broader trend for the U.S. benchmark yield has been lower as it has pulled back from its May peak near 4.60%. Bond markets have dialed back expectations for Fed interest rate cuts to two this year, down from three** following the Nonfarm payroll report that showed strong-than-expected job gains in June. The labor market remains healthy but is cooling from a position of strength, which should allow the Fed to stay on the sidelines a while longer to gain greater clarity on the impact of tariffs on inflation. We expect the Fed to be able to cut interest rates in September or October. Lower interest rates should reduce borrowing costs for businesses and consumers, which is supportive of the economy and corporate profits, in our view.

Brian Therien, CFA
Investment Strategy

*FactSet
**CME FedWatch
 

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