Stocks climb on AI and rate cut optimism, unfazed by Trump's tariff moves
Published: 04:07 PM,Jul 10,2025 | EDITED : 08:07 PM,Jul 10,2025
Adding to market momentum were strong quarterly results from TSMC, reflecting persistent demand in AI-related products— Reuters
SINGAPORE:Global stocks advanced on Thursday, underpinned by optimism around artificial intelligence and the prospect of upcoming interest rate cuts, while investors kept a cautious eye on US President Donald Trump's ongoing assault on international trade.
US copper futures widened their premium to the London benchmark overnight after Trump announced plans to impose a 50% tariff on copper imports starting August 1. He also threatened the same tariff on Brazil's exports to the US and issued notices to seven other minor trading partners.
Despite these developments, markets remained largely unfazed. European stocks rose, with Germany’s DAX up 0.1% and the UK’s FTSE 100 gaining 1% to record highs. Asia-Pacific shares outside Japan added 0.5%, while Nasdaq futures dipped slightly after the index hit a record high on Wednesday.
Jeff Ng, head of Asia macroeconomic strategy at SMBC, said investors have become “numb” to the shifting trade landscape, noting that the announced tariffs are often subject to negotiation, delay, or reversal.
Adding to market momentum were strong quarterly results from TSMC, reflecting persistent demand in AI-related products. The report followed Nvidia becoming the world’s first public company to surpass a $4 trillion valuation, giving further lift to tech stocks in Korea and Japan.
Expectations of at least two US Federal Reserve rate cuts this year also buoyed investor sentiment. Minutes from the Fed’s last meeting indicated that most members expect cuts later this year, viewing potential inflation from tariffs as likely “temporary or modest.” Mohit Kumar of Jefferies said the Fed is likely to prioritize employment over inflation. “If we get some weakness in the employment numbers over summer, the Fed will respond by cutting rates in September,” he said.
The dollar weakened slightly against the euro but held firm against the yen at 146.35, after a spike earlier in the week when Trump imposed 25% tariffs on Japan.
The euro rose 0.17% to $1.1734 and sterling gained 0.15% to $1.3611. The Brazilian real, however, hovered near a one-month low at 5.5826 per dollar, with volatility surging due to US tariff threats.
“The risk is that carry trades continue to be unwound on the back of heightened trade risks and higher financial market volatility,” said MUFG’s Lee Hardman.
In cryptocurrencies, bitcoin remained near a record high at $111,207, while ether rose 1.8% to $2,790.9.
Brent crude steadied at $70.2 a barrel and US crude was flat at $68.33. Spot gold rose 0.22% to $3,320.59 an ounce.— Reuters
US copper futures widened their premium to the London benchmark overnight after Trump announced plans to impose a 50% tariff on copper imports starting August 1. He also threatened the same tariff on Brazil's exports to the US and issued notices to seven other minor trading partners.
Despite these developments, markets remained largely unfazed. European stocks rose, with Germany’s DAX up 0.1% and the UK’s FTSE 100 gaining 1% to record highs. Asia-Pacific shares outside Japan added 0.5%, while Nasdaq futures dipped slightly after the index hit a record high on Wednesday.
Jeff Ng, head of Asia macroeconomic strategy at SMBC, said investors have become “numb” to the shifting trade landscape, noting that the announced tariffs are often subject to negotiation, delay, or reversal.
Adding to market momentum were strong quarterly results from TSMC, reflecting persistent demand in AI-related products. The report followed Nvidia becoming the world’s first public company to surpass a $4 trillion valuation, giving further lift to tech stocks in Korea and Japan.
Expectations of at least two US Federal Reserve rate cuts this year also buoyed investor sentiment. Minutes from the Fed’s last meeting indicated that most members expect cuts later this year, viewing potential inflation from tariffs as likely “temporary or modest.” Mohit Kumar of Jefferies said the Fed is likely to prioritize employment over inflation. “If we get some weakness in the employment numbers over summer, the Fed will respond by cutting rates in September,” he said.
The dollar weakened slightly against the euro but held firm against the yen at 146.35, after a spike earlier in the week when Trump imposed 25% tariffs on Japan.
The euro rose 0.17% to $1.1734 and sterling gained 0.15% to $1.3611. The Brazilian real, however, hovered near a one-month low at 5.5826 per dollar, with volatility surging due to US tariff threats.
“The risk is that carry trades continue to be unwound on the back of heightened trade risks and higher financial market volatility,” said MUFG’s Lee Hardman.
In cryptocurrencies, bitcoin remained near a record high at $111,207, while ether rose 1.8% to $2,790.9.
Brent crude steadied at $70.2 a barrel and US crude was flat at $68.33. Spot gold rose 0.22% to $3,320.59 an ounce.— Reuters