European shares closed decrease on Monday, and the euro slid, as markets digested a long-awaited EU-US commerce settlement introduced on Sunday.
On the opposite facet of the Atlantic, the S&P 500 and Nasdaq closed at document highs, once more, in the beginning of every week jam-packed with large bulletins. Hold studying to seek out out extra.
EU-US Commerce Settlement
On Sunday, European Fee President Ursula von der Leyen travelled to Scotland to fulfill US President Donald Trump.
The 2 leaders struck a commerce settlement which imposes a 15% tariff on most EU exports to the US. While this consists of vehicles, which had beforehand confronted a tariff of 27.5%, it excludes metal and aluminium, which is able to proceed to face duties of fifty%.
Some sectors, together with plane components, will keep away from tariffs, however an inventory of duty-free merchandise has but to be finalised, with wines and spirits nonetheless being negotiated.
Trump additionally stated that the EU would improve funding within the US by $600 billion and spend $750 billion on vitality.
Quite a lot of European leaders have subsequently voiced displeasure with the settlement.
German Chancellor Friedrich Merz stated it will “considerably harm” the German financial system however conceded that the Brussels negotiating crew “couldn’t count on to realize any extra”.
French Prime Minister Francois Bayrou stated it was a “darkish day” and likened the settlement to “submission”.
The Market Response
On Monday morning, European shares initially reacted positively to the information, as traders embraced readability after months of uncertainty. Nonetheless, the positive aspects did not final.
Sooner or later throughout the day, the market appeared to understand that though tariffs of 15% have been preferable to the 30% being threatened, they’re significantly greater than the typical 4.8% levy which had been in drive pre-Trump.
The Germany 40 index, which had opened 0.86% greater on Monday morning, reversed course and closed the session down by 1.02%. Equally, France’s CAC40 opened 1.15% greater however closed with a lack of 0.43%.
The euro additionally slid, falling 1.35% towards the US greenback and 0.78% towards the British pound. Nonetheless, the euro stays up 12% towards the greenback yr so far.
Throughout the Atlantic, Wall Avenue had a reasonably muted session, however the S&P 500 and Nasdaq nearly managed to shut at document highs after gaining 0.02% and 0.33% respectively. Conversely, the Dow Jones settled down by 0.14%.
The session marked the sixth consecutive day of document closes for the benchmark S&P 500 index and its fifteenth document shut of the yr.
What to Look Out for This Week
It’s a busy week when it comes to doubtlessly market transferring bulletins, with a slew of necessary financial information and large company earnings studies due over the approaching days.
Financial Bulletins
On Wednesday, the Federal Reserve is extensively anticipated to carry rates of interest regular for a fifth consecutive assembly, regardless of President Trump ratcheting up stress on the central financial institution.
Rate of interest futures traded on the CME Group present a 97% chance that charges will stay unchanged, based on CME’s FedWatch device.
Consequently, market members will probably be extra targeted on subsequent feedback from Fed Chair Jerome Powell for any indication as to the place rates of interest will probably be heading later within the yr.
The next day, the Private Consumption Expenditures Index – the Fed’s most well-liked measure of inflation – will probably be launched, which is able to present what impact Trump’s tariffs have so far had on costs.
Different necessary occasions within the financial calendar this week embrace:
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Wednesday, 29 July:
- Germany Gross Home Product (GDP) Q2 2025
- US GDP Q2 2025
-
Thursday, 30 July:
- Germany Client Value Index (CPI) July 2025
- Friday, 1 August:
Earnings Watch
Up to now, 170 corporations from the S&P 500 have launched quarterly earnings, with 83% beating expectations.
This week is ready to be the busiest of earnings season, with greater than 150 corporations from the S&P 500 scheduled to report.
Amongst these corporations are 4 of the so-called Magnificent Seven, with Microsoft and Meta Platforms slated for Wednesday and Apple and Amazon for Thursday.
Different notable earnings bulletins embrace:
-
Tuesday, 29 July:
- Visa
- Procter & Gamble
- UnitedHealth
- Boeing
- Wednesday 30 July:
- Thursday, 31 July:
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