Looking to the Futures
Equities Shake off Tariff News

Equity markets recaptured losses early in the session to close positive yesterday despite tariff threats from President Trump over the weekend. Hawkish comments from the Cleveland Fed President Beth Hammack also weighed on equity markets going into Monday's session. Earnings season is around the corner with a variety of big banks announcing this week. In the bull camp bitcoin saw all-time highs yesterday as the US House prepares to consider this week’s legislation that would advance President Trumps crypto agenda. Economic news out of China was better than expected yesterday and the US has a variety of economic announcements to come later this week. Global bond yields were higher on Monday.
Last weekend President Trump stated the US would impose 30% tariffs on US imports from the European Union and Mexico starting August 1st. The Trump administration also reiterated that they would not offer additional extensions on country-specific tariffs that are to take affect August 1st, including a 35% tariff on some Canadian products. Last week, President Trump imposed a 50% tariff on copper imports that will include semi-finished goods. He also indicated drug companies could see tariffs as high as 200% on imports if they do not relocate production to the US within the next year. Progress has been made with trade officials in India, but President Trump indicated he would still impose a 10% tariff on India's goods for their participation in BRICS, arguing that this group of developing nations was established to hurt the US.
Hawkish comments from FOMC members over the weekend provided some selling pressure on equity and bond markets. Cleveland Fed President Beth Hammack stated that she would like to see inflation decline further before she would support cutting interest rates and plans to take a wait and see approach to understand how the new policies put forward will impact inflation.
Big banks are set to kick off second quarter earnings season this week. According to Bloomberg Intelligence the consensus for Q2 earnings of S&P 500 companies is an increase of +2.8% y/y. This would indicate the smallest increase in two years and only six of the eleven S&P 500 sectors are projected to post an earnings increase.
Bitcoin rallied to all-time highs yesterday pushing nearly +2% higher at its intraday highs. The US House Committee on Financial Services stated this week will be "Crypto Week." The US House Committee on Ways and Means has planned an oversight subcommittee hearing on July 16th titled, "Making America the Crypto Capital of the World," which could look to remove barriers for cryptocurrencies within the United States.
Economic news out of China came in better than expected, which could be bullish for global economic growth. China June exports increased +5.8% y/y, beating the expected +5.0% y/y increase. June imports rose +1.1% y/y, beating the expected increase of +0.3% y/y.
This week we will see US economic reports that will outline the inflationary environment including Tuesday's US June CPI, which is expected to increase +1.9% y/y from +1.7% y/y in May. The June Core CPI, excluding food and energy, is expected to increase +2.9% y/y from +2.8% y/ in May. On Wednesday, the June PPI final demand is expected to ease slightly to +2.5% y/y from +2.6% y/y in May and the June core PPI is expected to increase +2.7% y/y from +3.0% in May. On Thursday, June retail sales are expected to increase +0.1% m/m and +0.3% ex-autos with weekly initial unemployment claims expected to climb +7,000 to 234,000. Friday we will see June housing starts that are expected to climb +3.3% m/m to 1.298 million and June building permits are expected to drop -0.6% m/m to 1.386 million.
Global bond yields were mixed to start the week with the 10-year US Treasury note yield increasing +2.2 bp to 4.432%. The 10-year German bund yield rose +0.7 bp to 2.732% and the 10-year UK gilt yield dropped -1.7 bp to 4.605%.
Technicals
Looking at the daily chart for the E Mini S&P 500 September 2025 (/ESU25) contract we can see a steady uptrend of the 20-Day, 50-Day, and 200-Day Simple Moving Averages following all time highs last Thursday. The contract has not tested the 20-Day SMA price point as it trades on low to moderate volume. Looking at the Bollinger bands we can see the contract is consistently testing the upper band and the squeeze led to an upside move in the 3rd week of June.
The Daily Technical Summary by Hightower Research indicates support levels at 6268.00 and 6245.63 with resistance levels at 6321.50 and 6352.62.
According to the CFTC Commitment of Traders Report released July 8th asset managers have increased their long positions by +6,898 contracts and decreased their short positions by -16,491 contracts. Asset managers are net long 863,537 contracts.
The 14-Day Relative Strength Index at 68.24% indicates the contract is moving into overbought territory.

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