- Oil prices fall as tariff deadline looms: Markets Wrap
Oil prices declined for a third consecutive session on Tuesday on concerns the brewing trade war between
major crude consumers the United States and the European Union will curb fuel demand growth by reducing
economic activity. Brent crude futures fell 62 cents, or 0.9%, to close at $68.59 a barrel. U.S. West Texas
Intermediate crude lost 99 cents, or 1.47%, to settle at $66.21 a barrel. The August WTI contract expires on
Tuesday and the more active September contract was down 47 cents, or 0.7%, to $65.48 a barrel. The EU is
exploring a broader set of possible counter-measures against the United States as prospects for an acceptable
trade agreement with Washington fade, according to EU diplomats. A weaker dollar has limited some losses
for crude as buyers using other currencies are paying relatively less. - S&P 500 ekes out another record close Tuesday as traders react to latest earnings
The S&P 500 narrowly posted another fresh record close on Tuesday, as traders weighed the latest earnings
reports and new trade developments. The broad market index ticked up 0.06% to end at 6,309.62 and notch
its 11th record close in 2025. The 30-stock Dow Jones Industrial Average rose 179.37 points, or 0.40%, settling
at 44,502.44. By contrast, the Nasdaq Composite slipped 0.39% and closed at 20,892.69, bogged down by
declines in tech stocks. It was the first negative day for the tech-heavy index in seven sessions. Chip stocks were
under pressure, as downbeat sentiment in the space was fuelled by a report by The Wall Street Journal that
said SoftBank and OpenAI’s $500 billion AI project has faced difficulties in getting underway and scaled down
its near-term plans. - Gold retreats from five-week high as investors book profits
Gold eased on Tuesday as investors booked profits after prices scaled a five-week high, while market
participants focused on trade talks ahead of U.S. President Donald Trump’s August 1 deadline. Spot gold fell
0.3% to $3,385.20 per ounce. Earlier in the session, bullion hit its highest since June 17. U.S. gold futures were
down 0.3% at $3,396.10. Gold prices edged lower amid profit-booking but remained close to the five-week
high due to lingering uncertainty ahead of the August 1 tariff deadline, said Jigar Trivedi, a senior commodity
analyst at Reliance Securities. - 10-year Treasury yield eases a bit, on hold before big Fed Decision next week
The 10-year Treasury yield moved lower on Tuesday as investors geared up for the Federal Reserve’s decision
next week. The benchmark 10-year Treasury yield was more than 2 basis points lower at 4.342%. The 2-year
yield dropped more than 1 basis point to 3.833%. The 30-year yield also fell more than 2 basis points to 4.911%.
The Fed is set to meet July 29-30, when it will make a decision on whether to cut interest rates. Fed funds
futures traders are pricing in more than 95% odds that the central bank will leave its current target rate range
unchanged at 4.25%-4.5%, per the CME FedWatch tool. This comes as President Donald Trump has been calling
for the central bank leader’s removal for months now, and the conflict remains in focus for investors. - Trump China tariff deadline likely to be extended, Bessent says
Treasury Secretary Scott Bessent on Tuesday said he is likely to hash out an extension of President Donald
Trump’s upcoming trade deadline with China when he meets with his Chinese counterparts in Stockholm next
week.The two sides in mid-May agreed to a 90-day suspension of most of the heavy tariffs on each other’s’
goods while they continued trade negotiations. That suspension is set to expire on Aug. 12. Bessent said on
Fox Business that he hoped the talks would touch on other areas of potential agreement, including getting
Beijing to slow the “glut of manufacturing that they’re doing and concentrate on building a consumer
economy.” But “we’ll be working out what is likely an extension” during talks in Stockholm on Monday and
Tuesday, Bessent said in a Fox Business interview. - Trump official vows Doge-inspired squeeze on government contractors
The Trump administration’s procurement chief has vowed to persist with a Doge-inspired pricing squeeze on
technology groups and government suppliers, after some of the US’s largest corporations complained to the
White House about his aggressive approach to cost-cutting. Josh Gruenbaum, a former investment banker and
director at KKR who runs the powerful Federal Acquisition Service, has overseen a months-long review of
multibillion-dollar deals with software providers and consultancies, convincing companies including Booz Allen
Hamilton, Google and Oracle to offer steep discounts on services. But Gruenbaum’s sometimes brusque
approach — demanding that the likes of Microsoft, Amazon and Uber identify savings or face the possible
cancellation of lucrative contracts — has sent shockwaves through the tech and consultancy industries. - UK borrowing rises more than expected in June to £20.7bn
The UK government borrowed a higher than expected £20.7bn in June, fuelled by surging debt costs, as
chancellor Rachel Reeves struggles with weak economic growth and her own fiscal rules. The shortfall between
government income and spending was £6.6bn more than in June 2024 and higher than the £17.1bn forecast
for June this year by the UK’s fiscal watchdog. Tuesday’s data from the Office for National Statistics is likely to
further stoke expectations of tax rises in the Autumn Budget, following government U-turns on spending and
welfare cuts. - Philippines to pay 19% tariffs, open up to U.S., Trump announces
The Philippines and the United States have reached a new trade agreement that will establish an open market
relationship with zero tariffs for U.S. exports, according to an announcement from U.S. President Donald Trump
on Tuesday. In a statement posted on Truth Social following a White House meeting with Philippine President
Ferdinand Marcos, Trump indicated that while the U.S. will face no tariffs, the Philippines will pay a 19% tariff
under the terms of the deal. The agreement also includes provisions for military cooperation between the two
nations, though specific details about this aspect of the partnership were not disclosed. Trump described the
meeting as “a beautiful visit” and expressed that it was “a Great Honor” to meet with President Marcos, whom
he characterized as “Highly Respected in his Country” and “a very good, and tough, negotiator.” - Shares of department store Kohl’s surge 37% in wild trading
Shares of Kohl’s surged Tuesday in volatile trading that echoed the meme stock rallies of recent years. The
legacy department store’s stock more than doubled from Monday’s close of $10.42 per share, only to see those
gains wiped out about a half an hour after markets opened. Trading in the stock was temporarily halted at one
point Tuesday morning. Still, shares closed about 37% higher on the day. Meanwhile, the trading volume by
late morning Tuesday was almost 17 times higher than the average over the past 30 days. There were no
apparent corporate announcements or major stock ratings to send shares soaring on Tuesday, but Kohl’s has
all the markings of a meme stock. It’s a legacy department store that many retail investors grew up shopping
at, and it’s heavily shorted, with about 50% of shares outstanding sold short, according to FactSet. - AstraZeneca to invest $50 billion in the U.S. as pharma tariffs weigh
AstraZeneca on Monday said it plans to invest $50 billion in bolstering its U.S. manufacturing and research
capabilities by 2030, becoming the latest pharmaceutical firm to ramp up its stateside spending in the wake of
U.S. trade tariffs. The Anglo-Swedish biotech company, which is headquartered in Cambridge, England, said
the “cornerstone” of the commitment would be a new multi-billion-dollar facility to produce its weight
management and metabolic portfolio, including its oral GLP-1 obesity pill. The facility, planned for the
Commonwealth of Virginia, is set to be AstraZeneca’s largest single manufacturing investment in the world and
will “leverage AI, automation and data analytics to optimize production,” the company said. The latest funding
will also expand research and development and cell therapy manufacturing in Maryland, Massachusetts,
California, Indiana and Texas, and create “tens of thousands of jobs,” AstraZeneca added. - Nokia blames fall in profit outlook on Trump tariffs and weaker dollar
Nokia has downgraded its profit forecast for this year and pinned the blame on US President Donald Trump’s
tariffs and the decline in the dollar. The Finnish telecoms equipment maker said late on Tuesday that it
expected its underlying operating profit for this year to be €1.6bn-€2.1bn, down from a previous forecast of
€1.9bn-€2.4bn. It estimated that currency movements would cost it €230mn while tariffs at their current level
would hit profits by €50mn-€80mn. Nokia’s cut in guidance highlights how European companies are being hurt
by the fallout from Trump’s tariffs, which the president is imposing on nearly all countries worldwide. - Lockheed profit dives 80% on $1.6 billion charge, shares tumble
Lockheed Martin reported on Tuesday that its second-quarter profit plunged by about 80%, after the U.S.
defence group recorded a pretax loss of $1.6 billion, mainly linked to a classified program within its Aeronautics
segment, sending its shares down more than 8%. The company also trimmed its 2025 profit outlook by $1.5
billion or 18% and said it now targets $6.65 billion in operating profit for the year. This new guidance, revised
down since the company’s last estimate in April, did not include potential impacts from tariffs which have
affected other defence companies with international customers. The company’s hefty charge stemmed from
difficulties with a classified program in its Aeronautics business and international helicopter programs in its
Sikorsky unit. - Insurer Chubb’s second-quarter profit rises on strong underwriting business, investment income
Insurance company Chubb reported a rise in second-quarter profit on Tuesday, helped by improved
underwriting performance and investment returns. Macroeconomic volatility and the unpredictable impact of
severe weather events, particularly wildfires and hurricanes, have sustained demand for risk mitigation offered
by insurance products. Stronger underwriting reflects an insurer’s ability to price risk effectively, bolstering
profits despite higher claims. The insurer’s net investment income surged 6.8% to a record $1.57 billion during
the reported quarter. - Tesla stock rises as investors shrug off Musk political warning
Tesla stock rose 1.6% on Tuesday despite a brief dip following a Bloomberg report that SpaceX has warned
investors Elon Musk could return to U.S. politics. According to the report, SpaceX included new language in its
tender offer documents stating that Musk previously served as a senior adviser to President Donald Trump “in
connection with the Department of Government Efficiency and may in the future serve in similar roles and
devote significant time and energy to such roles.” Despite the potential distraction of Musk’s political activities,
Tesla shares maintained their upward momentum throughout most of Tuesday’s trading session. The electric
vehicle maker’s stock briefly dipped when the news broke but quickly recovered. - Philip Morris’ shares hit as ZYN falls behind high sales expectations
Marlboro maker Philip Morris International missed second-quarter revenue expectations on Tuesday as
shipments of its ZYN nicotine pouches disappointed. Shares in the world’s largest tobacco company by market
capitalization dropped about 7% in New York trade even as the company raised its full-year profit guidance.
PMI has been faster than its peers to transition from traditional tobacco products to smoking alternatives such
as ZYN, which has grown rapidly to become PMI’s star product and by far the U.S. market leader. While PMI’s
total sales rose 7.1% to $10.14 billion in the second quarter, they fell short of analysts’ average estimate of
$10.33 billion, as per data compiled by LSEG. Volumes in PMI’s nicotine pouch business rose 23.8%. The
company aims to generate two-thirds of its net revenues from smoking alternatives by 2030. - Halliburton forecasts steep full-year revenue decline on softer demand
Oilfield services company Halliburton forecast a sharp decline in full-year revenue on Tuesday after posting a
33% fall in profit for the second quarter due to softer-than-expected demand. Houston-based Halliburton
joined larger rival SLB in warning of lower activity by oil and gas producers as weak and volatile oil prices have
led producers to curb capital spending and drilling. Oil prices have decreased by about 8% over the last year.
North American producers are planning meaningful scheduled gaps in drilling and completions activity in the
second half of 2025, while international customers continue to reduce activity and lower discretionary
spending, reflecting much lower commodity prices, Miller added. Shares of the company were down 0.7% at
$21.03. They are down nearly 23% year-to-date.
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