Market Quick Take – 31 July 2025

Market drivers and catalysts

• Equities: Fed holds rates, Powell cautious; Meta and Microsoft surge; European earnings mixed
• Volatility: VIX eases to 15.5; expected SPX move ±21 pts today, ±51 pts for week
• Digital assets: Bitcoin steady at $118.4k; Ether gains; IBIT and ETHA slightly lower
• Fixed Income: Market lowers anticipation of Fed easing after Fed Chair Powell presser
• Currencies: US firmed on jobs data and hawkish Fed, but JPY rebounds sharply overnight post BoJ inflation forecast raise.
• Commodities: US copper suffers worst ever day on Trump tariff exemptions.
• Macro events: BoJ Press Conference, Germany CPI, US PCE Inflation

Macro headlines

• The Fed maintained rates at 4.25%–4.50% for the fifth consecutive meeting, with two governors dissenting for a cut, a dual dissent not seen since 1993. Policymakers noted economic activity moderation in H1, contrasting earlier solid growth assessments. Unemployment remains low, inflation elevated, and economic uncertainty persists.
• The Bank of Japan left its policy rate unchanged at 0.50% as expected overnight and raised its core inflation outlook more than expected to 2.7% for the current fiscal year to end March 2026 from 2.2% previously, which would theoretically indicate higher odds of policy tightening, but while the yen rallied, Japanese rates (BoJ Governor Ueda will be out speaking just after this is being written and will provide more guidance).
• According to the US July ADP employment data, US private businesses added 104,000 jobs in July 2025, surpassing the expected 75,000 and marking the strongest gain since March. The service sector contributed 74,000 jobs, led by leisure and hospitality (+46,000), financial activities (+28,000), and trade, transportation, and utilities (+18,000), while education and health services lost 38,000 jobs.
• US President Trump asserted that the August 1st deadline is firm and won't be extended, adding that India will face a 25% tariff plus a penalty for importing Russian oil starting August 1st. He also imposed 50% tariffs on Brazilian goods, citing a “witch hunt” by former president Bolsonaro, and a 15% deal was agreed with South Korean on goods imports.
• Trump surprised the copper market by excluding some types ofcopper, including the most commonly traded refined copper in his 50% tariff plans for the metals, which triggered a massive slide in US copper futures (more below in Commodities).
• Japan's retail sales rose 2.0% year-on-year in June 2025, up from 1.9% in May and above the expected 1.8%, marking the 39th straight month of growth, supported by rising wages.
• The US economy grew 3% annualized in Q2, according to the first estimate of GDP growth for the quarter, beating expectations of 2.4% and rebounding from a 0.5% Q1 contraction. Growth was driven by a 30.3% plunge in imports and faster consumer spending (1.4% vs 0.5% in Q1), led by goods (2.2% vs 0.1%). It marked the tamest consecutive quarterly growth since the pandemic.

Macro calendar highlights (times in GMT)

• 0630 – Japan Bank of Japan press conference
• 0645 – France Flash July CPI
• 0755 – Germany July Unemployment Change and Rate
• 0900 – Eurozone June Unemployment Rate
• 0900 – Italy Flash July CPI
• 1130 – US Jul. Challenger Job Cuts
• 1200 – Germany Flash Jul. CPI
• 1230 – US PCE Inflation
• 1230 – US Weekly Initial Jobless Claims and Continuing Claims
• 1300 – South Africa Central Bank Rate Announcement
• 1345 – US Jul. Chicago PMI
• 2330 – Japan Jun. Jobless Rate

Earnings events

Note: earnings announcement dates can change with little notice. Consult other sources to confirm earnings releases as they approach.

• Today: Apple, Amazon, Mastercard, AbbVie, Samsung Electronics, Shell, CATL, Schneider Electric, Stryker, Safran, AB InBev, Ferrari, MercadoLibre, KLA Tencor, Microstrategy, Rolls Royce Holdings, The Southern Company, Coinbase, Tokyo Electron, Roblox, Cloudflare, BMW
• Friday: ExxonMobil, Chevron, Linde, Nintendo

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities

• US: US stocks mostly fell Wednesday as the Fed kept rates steady, dampening hopes for a September cut. The S&P 500 slipped 0.1%, Dow lost 171 points, while the Nasdaq rose 0.2%. Powell said more data is needed to assess tariff-driven inflation, with two Fed governors dissenting in favor of a cut. After-hours, Microsoft (+8%) and Meta (+11.5%) surged on strong earnings, led by Azure growth and upbeat guidance. Futures turned higher, with S&P 500 and Nasdaq 100 contracts up 0.7% and 1%, as investors looked to Amazon and Apple earnings later today.
• Europe: European markets closed slightly higher Wednesday, with STOXX 50 up 0.3%. Corporate results drove moves: L’Oréal (+4%), UBS (+1%), and Kering (+1.6%) rose on earnings beats, while Adidas (-7%) and Hermès (-4.5%) sank on disappointing results. DAX gained 0.2%, helped by Siemens Healthineers (+2%) and Porsche (+1.7%). Investors also digested news of Germany’s 2026 budget approval, which includes record infrastructure and defense spending.
• UK: The FTSE 100 ended flat at 9,136.94, supported by earnings from BAT, Unilever, and Rolls-Royce. BAT beat expectations on US growth and boosted its buyback program to £1.1bn. Unilever exceeded profit forecasts, citing strong Home Care sales, while Rolls-Royce raised guidance after a 50% jump in H1 operating profit. Shell also posted better-than-expected earnings and announced a $3.5bn buyback.
• Asia: Asian equities were mixed Thursday. Hong Kong’s Hang Seng fell 1.5% on weak China PMI data, with property, consumer, and financial stocks leading losses. South Korea’s KOSPI slipped 0.3% after profit-taking despite a new trade deal with the US. Japan’s Nikkei gained 1% after the BoJ held rates but signaled future hikes. China’s Shanghai Composite dipped 1.1%, weighed by weak domestic demand despite earlier optimism over a potential bull market.

Volatility

• Market volatility eased after Wednesday’s brief uptick. The VIX fell to 15.48 (-3.1%), close to its three-month median, while VIX1D retreated to 13.8. Front-month VIX futures remained near 17.3, a modest premium to spot. Options imply a ±21-point (0.33%) move for the S&P 500 today and roughly ±51 points (0.8%) for the week. Despite a packed earnings calendar, investors see turbulence as contained unless key data or earnings surprise significantly.

Digital Assets

• Crypto markets were steady, with Bitcoin at $118,415 (+0.5%) and Ether at $3,859 (+1.3%). Demand for spot ETFs was muted, as IBIT (-0.5%) and ETHA (-0.1%) edged lower. Altcoins traded mixed: Solana +1.6%, XRP +1.3%, while Dogecoin was flat. Crypto-related stocks such as Coinbase (+1.6%) and MicroStrategy (+0.1%) also gained. Investors are cautious ahead of Friday’s US payrolls and any SEC update on ETH staking rules.

Fixed Income

• US treasury yields rose sharply all along the curve on US economic data (ADP employment change stronger than expected), but more forcefully on the hawkish lean at the Fed Chair Powell press conference, in which Powell was clearly cautious on the outlook for inflation, citing that the key focus is on the unemployment rate if the Fed is to consider any further easing. And yet a good portion of the move fizzled overnight, with the US 2-year benchmark treasury yield (more sensitive to the Fed outlook) two basis points lower after rising seven basis points yesterday to 3.94%, while the 10-year benchmark treasury yield fell back about two basis points after rising less than five basis points yesterday, still near its multi-week low of 4.31%.
• The market now only prices 36 basis points of Fed easing through the December meeting this year, about 10 basis points less than before yesterday’s Fed Chair Powell presser.

Commodities

• The US copper market saw its largest intraday drop ever after President Trump exempted refined copper from planned tariffs. Starting August 1, a 50% tariff will apply only to semi-finished copper products, with the bulk of copper trading in refined producs. US copper futures on Comex fell 20%, having previously traded 28% above London Metal Exchange benchmarks, as tariffs were expected on all refined imports.
• Oil remained steady after reaching a six-week high as Trump threatened penalties on India for buying Russian crude and cracking down on Iranian supplies. WTI traded above $70, Brent near $73. Trump noted tariffs and ongoing talks with India.
• Gold rebounded overnight after a sell-off through 3,300 yesterday, in part on the stronger US dollar and hawkish Powell press conference. After a 3,268 low, gold is pushing back on that 3,300 level this morning. Notable range support since May is at 3,245-3,250.
• Silver suffered a setback on the double whammy of lower US copper and gold prices yesterday, plunging all the way down through the former cycle high of 37.25, though it has rebounded near that level overnight.

Currencies

• The Japanese yen rallied after a sell-off versus the USD that saw USDJPY testing the 200-day moving average above 149.50. Ahead of the BoJ Ueda press conference this morning, USDJPY trades near 148.80.
• The strong US dollar yesterday saw the greenback posting new highs against most major currencies, although the move consolidated overnight after the rally that accelerated on the US July ADP employment data and during the hawkish Fed Chair Powell press conference late yesterday. After posting a 1.1404 low, EURUSD rebounded to 1.1437 as the euro remained broadly weak.

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