🤩Trump’s remarks reignited…Stock markets,Trump’s remarks reignited…Stock markets,

1. Trump’s remarks reignited…Stock markets, crude oil, crypto plunge amid trade tensions

Former U.S. President Donald Trump has renewed trade tensions by saying, “We can also stop the trade of cooking oil with China.” As a result, both the S&P 500 and Nasdaq turned downward. In particular, cryptocurrency and oil prices have also weakened, and selling of risky assets has been introduced. Meanwhile, the inflow of funds into gold and safe currencies has been concentrated.

2. Powell Says “Possible QT Termination”…Expectations for rate cuts to spread in October

The market reflects expectations of a rate cut as Fed Chairman Powell hints at the possibility of an early end to quantitative tightening (QT). The 2-year Treasury yield is near its lowest level since 2022. Following the rate cut in October and December, the prospect of another three cuts by 2026 is also spreading.

3. Concerns over AI Bubble Spread…Technology’s overvalued tech stocks rise in controversy

According to a BofA survey, 54% of institutional investors say AI tech stocks have entered a bubble phase. Citigroup CFO also said, “Some sectors seem to be overvalued.” The first structural skepticism signal about the recent ultra-strong trend of AI-focused themes.

4. Earnings Season Opens…Big financial stocks boost, reaffirm consumer health

Big banks like JPM, Citi, Goldman Sachs perform well. Overall, market expectations were exceeded due to strong interest earnings and trading segments. This is interpreted as a sign that the consumer sector remains healthy, and DPZ (Domino Pizza) also had strong shares before the earnings report.

5. Preference for Safe Assets Deepens…Preference for gold, dollar and short-term bonds is clear

A return to safe assets is clear due to complex risks such as trade tensions, interest rate path uncertainty and AI bubble concerns. Rising gold prices, strong yen and franc. In particular, the possibility of the Fed’s QT termination raises demand for short-term bonds.

📌Conclusion

As China has come out tough without responding to Trump’s megataco at all, the retoric war seems to stimulate market volatility, mentioning additional trade regulations with China. The market, which has fallen as it flows down at the end of today’s market, shows that the market is still vulnerable to these issues.

However, market expectations of a rate cut are acting as a “Fed Foot” as Chairman Jerome Powell has indicated that he will end tightening and continue to cut interest rates. However, it is worth watching that banks raised their provisions for bad debts (JPM) and predicted a large reduction in the number of employees at the end of the year (Goldman) despite strong performance.