Dow Jones Forecast: DJIA edges higher with more tariffs planned

US futures

Dow futures 0.2% at 44339

S&P futures 0.2% at 6238

Nasdaq futures 0.23% at 22744

In Europe

FTSE 0.18% at 8890

DAX 1.2% at 24597

• US stocks are modestly higher
• Trump plans a 50% tariff on copper
• Trump mentions tariffs for semiconductors and pharmaceuticals
• Oil steadies ahead of inventory data

Trump plans copper tariff

US futures are modestly higher as investors weigh up the latest announcements from President Trump and watch for further trade developments.

President Trump announced plans to impose 50% tariffs on copper imports, sending prices sharply higher. US copper prices shot 13% higher, closing at a record high of $5.69 per tonne on Tuesday, following the threat.

Trup also talked of tariffs on semiconductors and pharmaceuticals. These latest developments follow Trump's sending of letters to 14 countries yesterday, with an additional seven countries set to receive letters today. The deadline has been set for August 1.

Stocks on Wall Street were little changed on Tuesday and are set for a muted open today as the market appears to be in a wait-and-see mood. Last week, U.S. stocks reached a record high.

Attention is also turning to the FOMC minutes due later today. The minutes relate to the previous meeting where the Fed left rates unchanged but warned of the expected inflationary impact of tariffs. A hawkish-sounding Fed could pull stocks lower and lift the USD.

Corporate news

Amazon is in focus as its 4-day Prime Day continues. Investors will watch for details on the consumer.

Defence stocks are expected to rise after strong gains in Europe.

US banks will kick off earnings season next week, following a rise to record highs in Q2.

Dow Jones forecast – technical analysis

The Dow Jones has extended its recovery to 44,800, just shy of its 45,000 record high reached in January. The RSI is tipping into overbought territory, so some consolidation could be on the cards. Buyers will look to extend the bullish run above 45,0000 to fresh record highs. Meanwhile, immediate support is at 44,500. Below here, 44,000 could offer some support. It would take a drop below 42,800 to negate the near-term bull trend.

FX markets – USD rises, EUR/USD falls

The USD is rising mostly as it continues to recover from its 3.5-year low, despite recent trade tariff announcements. Attention will be on the FOMC meeting minutes due to be released later.

The EUR/USD is falling as the market awaits further news on EU-US trade talks. Trump has suggested that talks are going well and that he expects an announcement on trade with the EU in the coming days.

GBP/USD is unchanged amid a quiet day on the UK economic calendar. The price has eased back from its 3.5-year high reached at the end of last month amid concerns over the outlook for public finances. Expectations are that the government may hike taxes, which are typically deflationary, as it needs to plug a budget deficit.

Oil hovers around a 2-week high

Oil prices are holding steady on Wednesday, hovering around a two-week high reached in the previous session, as markets await clarity on US tariffs and after rising crude inventories in the US.

Figures from the API showed that US inventories gained 7.1 million barrels in the week ending July 4th, despite estimates of a 2.8 million barrel draw. Typically, this would have a bearish impact on the price, especially when OPEC+ is also increasing output. EIA inventory data is due shortly.

Chinese inflation data turned positive in June for the first time since January. China is the world’s largest importer of oil.

Furthermore, a peak driving season in the US could help support demand. There are also signs in the market that investors are less worried about the impact of Trump’s trade tariffs, on expectations that he is open to negotiation.

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