S&P 500 Forecast: SPX unchanged after more trade tariffs

US futures                                         

Dow futures 0.09% at 44486

S&P futures -0.07% at 6257

Nasdaq futures -0.3% at 22787

In Europe

FTSE 0.94% at 8950

DAX -0.04% at 24508

• US stocks are subdued after a record high yesterday
• Trump announced a 50% tariff on copper
• FOMC minutes showed divisions between policymakers
• Oil falls with trade tariffs in focus

Trump’s tariffs in focus - Brazil in the firing line

US futures are pointing to a subdued start on Thursday, following the Nasdaq 100's record levels reached yesterday, as investors digest Trump's latest tariff announcements.

Yesterday, Trump announced a 50% tariff on copper to start from August 1st, and he also threatened a 50% tariff on exports from Brazil to the US. This was significantly higher than the Liberation Day tariff. Trup cited the treatment of former President Bolsonaro as a reason for the higher tariff threat. Should Trump implement this higher tariff food prices in the US could rise, particularly coffee, sugar and orange juice.

Meanwhile, the markets are also digesting the minutes from the June Fed meeting, which were released yesterday. The minutes show that some Fed policymakers are open to cutting interest rates as soon as July. However, the vast majority of policymakers expect two rate cuts before the end of the year, although there were some Fed officials who considered that no rate cuts would be needed.

The division between the Fed highlights the level of uncertainty regarding the outlook for growth and the impact of Trump's trade tariffs. The market has become desensitised to the latest trump headlines.

On the data front, US jobless claims fell to 227,000, beating expectations and signalling some strength within the labour market. Forecast had been for 236,000 jobless claims. The lower number suggests fewer layoffs and a potentially robust labour market.

Corporate news

Delta is flying over 12% higher after the airline reinstated its 2025 profit outlook and following Q2 revenue and earnings which beat forecasts.

WK Kellogg, the breakfast food company, has jumped 30% after agreeing to a buyout from Italian chocolate maker Ferrero for $23 a share. This values the firm at $3.1 billion.

AMD, the chipmaker, is up over 2% following an upgrade to "buy" from analysts at HSBC, who cited higher-than-expected pricing for its newest AI chip, which could add significant upside to revenue.

NVIDIA is set to open over 1% higher, adding to yesterday's gains of 1.8%. The AI chipmaker briefly surpassed the $4 trillion market capitalization mark yesterday.

S&P 500 forecast – technical analysis

The S&P 500 has broken out of the  rising channel and looks towards 6285 and fresh record highs. Traders should be wary of the RSI which is on the brink of overbought territory. Support can be seen at 6225 the rising support trendline. Below here 6200 and 6150 come into play.

FX markets – USD rises, EUR/USD falls

The USD is edging higher as it continues its recovery from a 3 1/2 year low, and as investors digest the latest trade tariff developments, along with minutes from the FOMC, which point to two rate cuts this year.

The EUR/USD is Falling against the stronger U.S. dollar as the EU awaits more clarity on EU-U.S. trade relations. A framework trade deal is expected to be announced in the coming days.

GBP/USD is edging lower towards 1.3550. I made a quiet UK economic calendar, and as ongoing fiscal worries continue to weigh on the pound's outlook. Earlier in the week, the Office for Budget Responsibility sounded the alarm over the vulnerable British economy. The UK faces a risk to public finances amid soaring debt.

Oil hovers around a 2-week high

Oil prices are falling as the tribal economic outlook turns more bearish following Trump's trade tariff announcements.

On Wednesday, Trump threatened Brazil with 50% tariffs on exports to the US. He also announced tariffs on copper, semiconductors, and potentially pharmaceuticals, as well as sending letters to the Philippines, Iraq, and other economies.

Trump has a reputation for backpedaling on tariffs, which means the market has become less sensitive to such announcements. Investors are in a wait-and-see mood.

Data yesterday showed US crude stockpiles rose whilst gasoline and distillate inventories fell. Meanwhile daily flights were averaging 107,600 in the first week of July marking an all time high. Yeah today global oil demand growth is averaging 0.97 million barrels a day in line with expectations.

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