Oil and stock markets plunge after Trump's tariffs rattle investors
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Zawya
an hour ago
- Zawya
Record-high stocks tremble as big week for market risk looms
Investors cashed out of record-high global stocks on Friday and the dollar headed for its first weekly drop in four, as markets trembled ahead of next week's U.S. jobs data, Federal Reserve and Bank of Japan meetings and Donald Trump's tariff deadlines. MSCI's global equity index was 0.3% lower after hitting an all-time peak on Thursday, after Japan's Topix index ended the day 0.9% lower, having also hit a record high a day earlier. Futures trading signalled Wall Street's Nasdaq Composite would flatline later in the day, with sentiment still buoyed by Google parent Alphabet's robust earnings that propelled the tech-heavy index to its latest peak on Thursday. Investors said they did not expect the markets' glass-half-full approach to trade war risks to last if jobs growth and earnings slow but the U.S. Federal Reserve also douses expectations that it will rush to the rescue by easing monetary policy. With the Fed's next rate decision on July 29 as Chair Jerome Powell comes under pressure from Trump to quit, August 1 brings the latest batch of monthly U.S. jobs data and the deadline for U.S. trade deals with Europe and other countries. "We've come to this sort of real, sort of pinch point of high risk, of things going in either direction, and markets have just breezed through it so far," Premier Miton CIO Neil Birrell said. "I'm genuinely struggling to work out why the bond markets seem relatively complacent and why equity markets have kept going up," he said, especially with disruption caused by trade uncertainty now showing up in companies' earnings. TECH, CENTRAL BANKS The dollar index, was heading for a 0.6% weekly drop, in the latest sign that U.S. policy and debt risk meant it was no longer viewed by investors as a haven asset when stock markets turn lower. "We know that the dollar tends to depreciate when there is a proper risk-on wave,' Amundi Investment Institute cross-asset strategist Federico Cesarini said. 'But the other side of the correlation, risk-off (and) dollar up, is not with us anymore.' Tech titans Amazon, Apple, Meta and Microsoft may all issue tariff-related updates with next week's earnings reports, just as parts of the tech sector have shown signs of revenues turning hard to forecast because of stockpiling and trade anxiety. Chipmaker Intel's shares dropped 5% in pre-market trade on Friday as it forecast steeper quarterly losses than expected and said it had halted or scrapped new factory projects in the U.S. and Europe. Money markets are only pricing about 42 basis points (bps) of Fed easing this year, setting next week's monthly non-farm payrolls report up as a major risk event if hiring has slowed and rate cut expectations have not risen. Trump has kept up pressure on Powell to cut rates after a rare presidential visit to the central bank on Thursday, although he said he did not intend to fire the head of the central bank, as he has frequently suggested he would. U.S. 10-year Treasury yields were steady at 4.41% while two-year yields, which track monetary policy bets, were also flat at 3.925%. The Bank of Japan has its own policy announcement on Thursday, and Prime Minister Ishiba's Liberal Democratic Party holds a meeting on the same day. That's after the European Central Bank held rates steady on Thursday and was viewed by traders as likely to pause further cuts until the end of the year. The euro was steady against the dollar on Friday at $1.178 , although German government debt sold off, with the yield on benchmark 10-year Bunds up 4 basis points (bps) at 2.726%. Elsewhere in markets, gold eased 0.8% to around $3,339 an ounce. Brent crude futures gained 0.4% to $69.65 a barrel. (Reporting by Kevin Buckland; Editing by Lincoln Feast, Sam Holmes and Saad Sayeed)
Zawya
an hour ago
- Zawya
OPEC+ panel likely to keep oil policy steady on Monday, sources say
An OPEC+ panel is unlikely to alter existing plans to raise oil output when it meets on Monday, four OPEC+ delegates said, noting the producer group is keen to recover market share while summer demand is helping to absorb the extra barrels. The meeting of the Joint Ministerial Monitoring Committee (JMMC), which includes top ministers from the Organization of the Petroleum Exporting Countries and allies led by Russia, is scheduled for 1200 GMT on Monday. Four OPEC+ sources told Reuters the meeting is unlikely to alter the group's existing policy, which calls for eight members to raise output by 548,000 barrels per day in August. Another source said it was too early to say. OPEC and the Saudi government communications office did not respond to a request for comment. OPEC+, which pumps about half of the world's oil, has been curtailing production for several years to support the market. But it reversed course this year to regain market share, and as U.S. President Donald Trump demanded OPEC pump more to help keep a lid on gasoline prices. The eight OPEC+ producers hold a separate meeting on August 3 and remain likely to agree to a further 548,000 bpd increase for September, three of the sources said, as reported by Reuters earlier this month. This would mean that, by September, OPEC+ will have unwound their most recent production cut of 2.2 million bpd, and the United Arab Emirates will have delivered a 300,000 bpd quota increase ahead of schedule. The JMMC meets every two months and can recommend changes to OPEC+ output policy. Oil prices have remained supported despite the OPEC+ increases thanks to summer demand and the fact that some members have not raised production as much as the headline quota hikes have called for. Brent crude was trading close to $70 a barrel on Friday. (Addiitonal reporting by Yousef Saba; Editing by David Holmes)
The National
an hour ago
- The National
Trump's Scotland foray clouded by Gaza suffering
Air Force One is set to land in a corner of Scotland late on Friday, with an armoured motorcade ready to ferry US President Donald Trump through police lines to spend the next few days golfing. Mr Trump's trip − his first to the UK since his second term began in January − is a private visit, the main purpose of which appears to be to spend time at his two Scottish golf courses, Trump International at Menie in Aberdeenshire and Trump Turnberry in South Ayrshire. But it is unlikely that the President will be isolated from events in the wider world during his golf break. If the TVs at the Trump International clubhouse are showing news channels, the US team will see starvation in Gaza is dominating the news agenda. Keir Starmer is meeting the President on Monday, presenting the British Prime Minister with a dilemma. Mr Starmer is under intense pressure to follow France's lead and recognise a Palestinian state. With Mr Trump largely unapologetic for his military and political support for the Israeli government, his visit will likely be framed by demonstrations with mass protests promised in Scotland's cities. The Scottish government has confirmed that First Minister John Swinney will also meet the President during his visit. Fairway meetings Not being a golfer, Mr Starmer will greet Mr Trump a short drive away from the greens of Turnberry on the Ayrshire coast − where a peak season round costs £1,000 ($1,350) − for lunch and a bilateral meeting. The original plan was to press Britain's case to evade Mr Trump's harshest tariffs, avoiding 25 per cent on steel exports and a potential 200 per cent hike on pharmaceuticals that are worth £9 billion a year to Britain. But the grim news of starvation in Gaza and political momentum over formal Palestinian state recognition mean the Middle East will now top the agenda. It will be a difficult political balancing act for Mr Starmer as America has just pulled out of ceasefire talks with Hamas, while members of the UK leader's cabinet are calling for Palestinian recognition and a much firmer line towards Israel. Scores of MPs from across the UK's political parties have also written a letter urging for the move. Amid this, Mr Starmer will attempt to continue his campaign of seeking to befriend Mr Trump, keeping him onside over support for Ukraine and Nato. There's a possibility that if the pair's chats continue, Mr Starmer might be invited on Air Force One for the short flight to Aberdeenshire, to Trump International at Menie, where the president will open a new course with a round. But in Scotland's cities, anger over the war in Gaza is expected to see thousands turn out in Glasgow, Edinburgh and Aberdeen to protest. Influencing Trump The politics over Palestine and other issues will be a challenge, former junior foreign minister Tobias Ellwood told The National. 'However much you might disagree with the individual, Mr Trump represents our closest security ally and, therefore, any opportunity to strengthen that bond, as well as take advantage of behind the scenes back-channel communications, should absolutely be leveraged,' said the former Conservative MP. That will provide Mr Starmer with the chance to ask Mr Trump to influence Israel on getting humanitarian aid into Gaza and obtaining a ceasefire. 'It's very difficult to see any of the challenges that we face across the world not moving forward without American involvement,' Mr Ellwood said. 'One thing that Britain has always done well is influencing, giving some thought leadership towards shaping America's opinion. So, this is a welcome opportunity to help shape and finesse American foreign policy, particularly on the Middle East.' Police operation Mr Trump's visit comes weeks after campaign group Palestine Action was banned under UK anti-terrorism laws. Scottish police have already issued a warning that anyone displaying support for the group will be arrested, with police following through on their threat by detaining a protester in Glasgow holding a 'Genocide in PALESTINE Time for ACTION' banner. 'Any support for Palestine Action, be that in terms of clothes worn, be that in terms of banners held, is now an offence under the Terrorism Act and people are liable to arrest for those offences,' said Assistant Chief Constable Emma Bond of Police Scotland, who is leading the security operation. Officers have been drafted in from across Britain. More than 5,000 are expected to take part in a five-day operation that is likely to exceed the £14.2m ($19.1) cost of Mr Trump's 2018 visit. Convoys of police vehicles have been seen heading up to Scotland this week from England. Metal fences have been erected around golfing links and vehicle checkpoints set up. Below par? If the 2018 trip sets a precedent, the police will be under even greater pressure given that the Israel-Gaza war is causing political ructions. Back then officers had to contend with protesters booing Mr Trump during a game of golf and hundreds of demonstrators on the perimeter of Turnberry. It was rounded off with a man flying a paraglider over the Turnberry hotel with a banner reading 'Trump: well below par #resist', in breach of the air exclusion zone. Publicity stunts will certainly be attempted again, with groups of protesters gathering, many under the Stop Trump Coalition that has pro-Palestine supporters, trade unionist and anti-Trump demonstrators in its ranks. One organiser highlighted opposition to the plan suggested by Mt Trump to develop Gaza into a tourist resort, with its Palestinian inhabitants moved to Egypt or Jordan. 'We stand in solidarity with the Palestinians who will not be forced out of Gaza so that Trump's 'Riviera of the Middle East' can be built on its mass graves,' the spokesman said. Vance bogey Mr Trump has deep roots in Britain. His mother was from the Outer Hebrides and emigrated to New York aged 18, later marrying his father Fred Trump, a property developer. That heritage stretches too to his Vice President JD Vance, who has Scots-Irish ancestry, and will spend his summer amid the low hills and stone cottages of England's Cotswolds. As with previous holidays in America, Mr Vance is likely to have to contend with demonstrators as he tries to relax with his wife and three young children. 'JD Vance is every bit as unwelcome in the UK as Donald Trump,' said the spokesman for the Stop Trump Coalition. 'We are sure that, even in the Cotswolds, he will find the resistance waiting.' The group said Mr Trump's formal state visit to Britain in September, where he will be accompanied by his wife Melania as they stay at Windsor Castle and dine with King Charles III, will also be met by protests.
