ADDX GO Market Morning Wrap - 31st July

Stock Market  

On Wednesday Eastern Time, Federal Reserve Chair Powell’s remarks dampened rate cut expectations, leading to mixed results for the major indices, with only the Nasdaq showing a slight gain.  

(S&P 500 minute chart, source: TradingView)  

 

At close, the Dow Jones Industrial Average fell 0.38% to 44,461.28 points, the S&P 500 dropped 0.12% to 6,362.90 points, and the Nasdaq rose 0.15% to 21,129.67 points.  

 

Tech stocks were mixed: Nvidia surged over 2% to a record high, Broadcom gained over 1%, while Apple dipped more than 1%.

 

Precious metals and copper concepts led losses, with Freeport-McMoRan down over 9%, Newmont Corporation down over 7%, Southern Copper down over 6%, Pan American Silver down over 5%, Coeur Mining down over 4%, and Pan American Silver down over 3%.  

 

The Fed kept the federal funds rate target range at 4.25% to 4.50% on Wednesday, in line with market expectations, marking the fifth consecutive meeting without a change since December last year.  

 

In the post-meeting press conference, Powell stated, “We have not made any decision on adjusting policy in September.”  

 

“Our responsibility is to keep long-term inflation expectations stable and prevent one-off price increases from turning into persistent inflation,” Powell said. “Higher tariffs are beginning to show more clearly in the prices of some goods, but their impact on overall economic activity and inflation remains to be seen.”  

 

This statement cooled market expectations for a September rate cut or further cuts by year-end. Influenced by Powell’s comments, investors reassessed the timing of rate cuts, pushing U.S. Treasury yields higher.

 

After Powell’s remarks, interest rate futures showed traders reducing bets on a rate cut, with the September cut probability dropping from about 65% on Tuesday to just under 50%.  

 

Jamie Cox, managing partner at Harris Financial Group, said, “Powell won’t cave to political pressure for a rate cut, so the market needs to reprice the federal funds rate for the coming months.”  

 

He added, “The market reaction isn’t dramatic, mainly because everyone has a rough idea of where rates are headed, even if Powell sticks to a wait-and-see stance.”  

 

Data released Wednesday showed U.S. Q2 GDP grew at an annualized rate of 3%, reversing the first quarter’s contraction.  

Global Hotspots  

Fed Maintains Federal Funds Rate Target Range at 4.25% to 4.50%

 

The Fed kept the federal funds rate target range at 4.25% to 4.50%, meeting market expectations, marking the fifth consecutive hold.  

 

Powell: No Decision on September Meeting Yet, Tariff Impact on Inflation to Be Watched  

 

On Wednesday Eastern Time (July 30), Fed Chair Powell said in the post-meeting press conference that policymakers have not decided on a September rate move, noting that a moderately restrictive policy remains appropriate, with the tariff impact on inflation still under observation.  

 

Trump Claims Trade Deal with South Korea, Imposes 15% Tariff

 

On July 30 local time, U.S. President Trump posted that the U.S. has reached a “comprehensive and complete” trade deal with South Korea.

 

Under the agreement, South Korea will provide $350 billion for U.S.-owned and controlled investment projects, purchase $100 billion in liquefied natural gas or other energy products, and commit to a significant reinvestment for domestic purposes.  

 

Trump Signs Executive Order, Imposes 50% Tariff on Brazil

 

The White House announced on July 30 that U.S. President Trump signed an executive order imposing an additional 40% tariff on Brazil, bringing the total to 50%. Trump had previously declared a 50% tariff on goods from Brazil effective August 1.  

 

Trump: India to Pay 25% Tariff 

 

U.S. President Trump announced on July 30 via his social platform Truth Social that a 25% tariff will be imposed on goods imported from India starting August 1.  

 

U.S. Suspends De Minimis Tax Exemption for Low-Value Goods  

 

The White House stated on July 30 local time that President Trump signed an executive order suspending the de minimis tax exemption for low-value goods.

 

Effective August 29, imports valued at $800 or less, previously exempt when sent via non-international postal networks, will now incur all applicable tariffs.

 

Goods sent via international postal systems will be taxed based on ad valorem or specific rates.  

Company News  

Microsoft: Q4 Net Profit Reaches $27.2 Billion, Up 24% 

 

Microsoft reported Q4 revenue of $76.44 billion, up 18% (expected $73.89 billion), with intelligent cloud revenue at $29.88 billion (expected $29.1 billion).

 

Q4 net profit was $27.2 billion, up 24%, with earnings per share at $3.65 (vs. $2.95 last year). Microsoft’s stock jumped over 7% after hours.  

META Q2 Net Profit $18.337 Billion, Up 36% 

 

META Platforms reported Q2 revenue of $47.52 billion, up 22% (expected $44.83 billion), with net profit at $18.337 billion, up 36%, operating profit at $20.44 billion, up 38% (expected $17.24 billion).

 

Q2 EPS was $7.14 (vs. $5.16 last year, expected $5.89). META raised its full-year capex guidance to $66-72 billion (from $64-72 billion). Meta’s stock surged over 10% after hours.  

 

Qualcomm Q3 Adjusted Net Profit $2.67 Billion, Up 25%

 

Qualcomm reported Q3 adjusted revenue of $10.37 billion, up 10% (expected $10.616 billion), with adjusted net profit at $2.67 billion, up 25%.

 

Q3 adjusted EPS was $2.77 (expected $2.72). The company forecasts Q4 revenue at $10.3-11.1 billion (expected $10.61 billion) and adjusted EPS at $2.75-2.95 (expected $2.84). Qualcomm’s stock fell over 5% after hours.  

 

U.S. Steel Adds Three U.S. Independent Directors to Board 

 

U.S. Steel, Nippon Steel, and its subsidiary Nippon Steel North America announced on July 30 the appointment of three U.S. independent directors to the U.S. Steel board.

 

The board now has seven members, four of whom are U.S. citizens, including the three independents.  

Forex & Commodities  

WTI crude futures rose 1.14% to $70/barrel. Brent crude futures gained 1.01% to $73.24/barrel.  

 

COMEX gold futures fell 1.58% to $3,327.9/oz. COMEX silver futures dropped 2.9% to $37.175/oz.  

 

At New York close, the dollar index rose 1.06% to 99.975.  

Key Events  

Trump Announces 50% Tariff on Imported Semi-Finished Copper Products from August 1 

 

The White House announced on July 30 local time that President Trump will impose a 50% universal tariff on imported semi-finished copper products and copper-intensive derivatives, effective August 1.

 

The White House noted that copper raw materials and scrap are exempt from Section 232 or reciprocal tariffs.

 

Trump announced on July 9 a 50% tariff on all copper imports to the U.S. starting August 1. U.S. media warn this could spike manufacturing costs, hitting the industry hard.  

Cryptocurrency  

Major digital assets fell Wednesday.  

 

Bitcoin dropped 0.9% to $116,979, with 24-hour trading volume up 0.2% to $68.86 billion.  

 

Ethereum (ETH-USD) fell 0.1% to $3,761.  

 

XRP (XRP-USD) lost 0.6%, BNB (BNB-USD) declined 2.3%, and Solana (SOL-USD) fell 3.2%.  

 

Dogecoin (DOGE-USD) shed 2.1%, and Cardano (ADA-USD) dropped 2.3%.  

 

The total market value of the cryptocurrency industry declined 1.1% in the past 24 hours to $3.82 trillion, with trading volume down 3.9% to $167.97 billion.  

Key Events  

JPMorgan Partners with Coinbase: Bank Accounts Link Directly to Crypto Wallets, Bypassing Data Intermediaries

 

U.S. banking giant JPMorgan has signed an agreement with cryptocurrency platform Coinbase to connect client bank accounts directly to crypto wallets.

 

A Wednesday (July 30) press release states that JPMorgan and Coinbase have established a strategic partnership, “introducing features to enhance access and choice for mutual clients.”  

Market Events and Most Anticipated Earnings Releases