US stock futures extend losses due to renewed US-EU tariff threats. Asia Pacific markets are resilient following rosy economic data from China and Singapore. Gold rallies.
Hong Kong, Singapore stocks resilient amid Trump Tariff threats; Gold shines on safe-haven demand
The major US stock indices have extended their losses from last Friday, 11 July, into today’s Asian session. The S&P 500 and Nasdaq 100 E-mini futures shed -0.5% at the time of writing due to US President Trump’s new aggressive tariffs rhetoric.
After unleashing a slew of tariff demand letters to US trading partners since the start of last week, Trump, in a surprise U-turn, lashed out at the European Union with a threat of a higher tariff rate of 30% versus April’s announced reciprocal rate of 20% to take effect on the new deadline of 1 August if better terms are not negotiated.
Last week, several media reports cited that a possible preliminary deal between the US and the EU is likely to be brokered by last weekend, and the latest developments have dashed such optimism as roadblocks persist. Germany’s DAX fell for the second consecutive session last Friday, a loss of – 0.8%.
Today, Asia Pacific stock markets are mostly unscathed from Trump’s latest tariff salvo, supported by two rosy key economic data releases from China and Singapore. Hong Kong’s Hang Seng Index advanced for the third consecutive session today with an intraday gain of 0.4% as it rebounded from its 20-day moving average, which is acting as an intermediate support at around 24,050.
High-flying Singapore’s Straits Times Index (STI) has benefited from the recent tariff turmoil due to its defensive nature, led by the stable dividend yields of its component stocks. The STI staged an intraday rally of 0.4% as it probed the 4,100 psychological level again today, poised to set a possible sixth consecutive session of a new record all-time closing high. Meanwhile, Japan’s Nikkei 225 shed by -0.2%, and Australia’s ASX 200 almost traded unchanged.
China’s export growth advanced by 5.8% year over year in June, beating expectations (May: 4.8% year over year, consensus: 5% year over year) to US$325 billion as Chinese manufacturers rode out the tariff rollercoaster since April. Chinese factories increased their sales in other markets to compensate for the drop in the US, with exports to 10 South Asian countries rising 17% year over year.
Singapore has managed to dodge a technical recession and expanded faster than expected in the second quarter. Preliminary Q2 gross domestic product grew 1.4% q/q on a seasonally adjusted basis, versus a consensus estimate of 0.7% q/q, and above a revised 0.5% q/q contraction in Q1.
Safe demand push factor has resurfaced in Gold (XAU/USD) after the yellow metal underperformed Silver (XAG/USD) in the past three weeks. Gold (XAU/USD) staged a rally of 0.9% last Friday, 11 July, hit a three-week high, and traded back above its 20-day and 50-day moving averages.
In today’s Asia session, Gold (XAU/USD) increased by 0.1% and probed the US$3,360 intermediate range resistance in place since 24 June (it printed an intraday high of US$3,374). Technical elements remain positive, and a daily close above US$3,360 may trigger a bullish movement at least on a multi-day horizon.
Our YouTube video above contains the latest intraday technical analysis on the US Wall Street 30, US Nas 100, US SPX 500, Hong Kong 33, Germany 30, EUR/USD, GBP/USD, AUD/USD, USD/JPY, Gold (XAU/USD), and West Texas Oil.
