Weekend News Roundup - Newsquawk Asia-Pac Market Open

• US stocks finished in the red on Friday but well off their intraday lows as attention remained on the recent tariff-related updates and as participants awaited Trump's tariff letter to the EU, while the inflationary fear aspect of higher tariffs pressured T-notes which were sold across the curve and yields bear steepened.
• US President Trump sent trade letters to the EU and Mexico announcing 30% tariffs from August 1st which would be separate from sectoral tariffs.
• Looking ahead, highlights include Japanese Machinery Orders, Singapore GDP & Chinese Trade Data.

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LOOKING AHEAD

• Highlights include Japanese Machinery Orders, Singapore GDP & Chinese Trade Data.
• Click for the Newsquawk Week Ahead.

US TRADE

• US stocks finished in the red on Friday but well off their intraday lows as attention remained on the recent tariff-related updates and as participants awaited Trump's tariff letter to the EU, while the inflationary fear aspect of higher tariffs pressured T-notes which were sold across the curve and yields bear steepened.
• SPX -0.33% at 6,260, NDX -0.21% at 22,781, DJI -0.63% at 44,372, RUT -1.26% at 2,235.
• Click here for a detailed summary.

TARIFFS/TRADE

• US President Trump sent trade letters to the EU and Mexico announcing 30% tariffs from August 1st which would be separate from sectoral tariffs.
• White House Economic Adviser Hassett said President Trump has seen some outlines of proposed trade deals and thinks they need to do better, while he added that these tariffs are real if Trump gets proposals that he doesn’t think are good enough.
• Mexican President Sheinbaum believes they will reach an agreement with the US before tariffs go into effect on August 1st, while she stated that Mexico’s sovereignty is not negotiable It was also reported that Mexico’s Economy Ministry said Mexico is negotiating and the working group with the US will aim for an alternative before August 1st to protect companies and employees.
• European Commission President von der Leyen said imposing 30% tariffs on EU exports would disrupt the essential transatlantic supply chains, while they remain ready to continue working towards an agreement by August 1st and will take all necessary steps to safeguard EU interests including the adoption of proportionate countermeasures if required. Furthermore, she said they will extend the suspension of their countermeasures to US tariffs until early August and noted they have always been clear that they prefer a negotiated solution with the US which remains the case.
• French President Macron said France fully supports the European Commission in the negotiations and shares the same very strong disapproval of the announcement of horizontal tariffs of 30% on EU exports.
• German Chancellor Merz said US tariffs of 30% would hit the German export industry to the core and they want to use the time until August 1st, while he stated that tariff letters were also US negotiating positions.
• German Economy Minister Habeck said the EU must pragmatically negotiate a tariff solution with the US that focuses on the main points of conflict and stated that new US tariffs would hit European exporters hard. Habeck also commented that new US tariffs would have a strong impact on the economy and consumers in Europe and the US.
  - German Finance Minister Klingbeil said Trump’s tariff policies threaten the US economy at least as much as European companies, as well as stated that the tariff conflict must end and nobody needs new threats or provocations. Furthermore, he said the EU needs to continue serious and targeted negotiations with the US but must take decisive countermeasures if a fair negotiated solution is not successful.
• German trade industry association said the newly announced tariffs are part of US President Trump’s negotiating strategy and Europe must not be impressed by Trump’s announcements but must seek a solution in talks on an equal footing.
• European Commission was reported on Friday to have dropped plans to levy a tax on digital companies, a move that hands victory to US President Trump and US tech giants like Apple (AAPL) and Meta (META), according to Politico.
• EU was reported on Friday to plan a new tax on big companies to boost the EU budget in which an annual charge would hit groups with a net turnover of EUR 50mln or more, according to a leaked European Commission proposal cited by FT.
• Chinese Foreign Minister Wang said China and ASEAN agreed to submit a free trade zone pact in October for approval and signing, while they agreed on a five-year action plan with all-round cooperation in over 40 fields and will complete a consultation on the ‘code of conduct in the South China Sea’ within 2026.

NOTABLE HEADLINES

• Fed's Goolsbee (2025 voter) said on Friday that the latest tariff threats could delay rate cuts and could spark fresh concerns about inflation, which might force the Fed to maintain its wait-and-see posture until the central bank gets more clarity, according to WSJ.
• White House Economic Adviser Hassett said the Fed has a lot to answer for on renovation cost overruns and if there is cause to fire Fed Chair Powell, President Trump has the authority to do so.
• NVIDIA (NVDA) CEO Jensen Huang is to hold a media briefing in Beijing on July 16th.

COMMODITIES

• Iraq set August Basrah Medium Crude official selling price to Asia at plus USD 1.35/bbl vs Oman/Dubai, while it set OSP to Europe at minus USD 0.55 vs Dated Brent and set the OSP to North and South America at minus USD 1.15 vs ASCI.

GEOPOLITICAL

MIDDLE EAST

• Israeli official said talks in Doha are ongoing with Hamas for a ceasefire and hostage deal but noted Hamas is sticking to positions that do not allow mediators to advance an agreement.
• US envoy to the Middle East Witkoff said he is hopeful on Gaza ceasefire negotiations and was said to meet senior Qataris in New Jersey on Sunday.
• Iranian Foreign Minister Araghchi said they are carefully assessing options for talks with the US.

RUSSIA-UKRAINE

• Russia’s Defence Ministry said Russian forces took control of Myrne and Mykolaivka in eastern Ukraine.
• Ukraine’s SBU intelligence agency accused Russia’s FSB of being behind the murder of an SBU Colonel in Kyiv last week and said agents responsible for the murder were killed during an operation to apprehend them on Sunday.
• IAEA team at Ukraine’s Zaporizhzhia nuclear power plant reported hearing hundreds of rounds of small arms fire on Saturday night.
• US President Trump is considering greenlighting new funding for Ukraine to send a message to Russia, according to CBS.
• North Korean leader Kim reaffirmed unconditional support for Moscow’s actions in the Ukraine war during a meeting with Russian Foreign Minister Lavrov, while North Korea and Russia pledged cooperation to safeguard each other’s territorial integrity. Furthermore, Russia expressed firm opposition to any attempt to undermine North Korea’s national security and sovereignty, while Moscow wants to further strengthen the strategic partnership.

OTHER

• North Korea warned it stands ready to take military action against threats from the US, Japan and South Korea following recent joint air drills involving a strategic US bomber, according to KCNA.

ASIA-PAC

NOTABLE HEADLINES

• Japan and the EU are seeking to develop a joint satellite network, according to Nikkei.

EU/UK

NOTABLE HEADLINES

• UK Chancellor Reeves is to hail fiscal ‘stability’ and City risk-taking in her Mansion House speech on Tuesday and will insist she has a grip on the UK economy and will not let borrowing run out of control, according to FT.
• Netherlands rationed electricity to ease power grid stresses as thousands of businesses and households waited to connect to the Dutch grid, while officials and companies said lengthy waits for connections were holding up economic growth and could force businesses to rethink their investment plans, according to FT.
• Fitch affirmed Germany at AAA; Outlook Stable.