TL;DR

U.S.–China trade deal signed; S&P 500 nears record on Fed cut bets; Nike jumps despite tariff warning.

Highlights

• Trump announced a new U.S.–China trade deal, including an agreement to expedite Chinese rare earth exports to the U.S.; details pending12.
• U.S. and China’s rare earth accord aims to stabilize key tech and defense supply chains after recent disruptions2.
• Nike beat lowered Q4 estimates despite a 12% revenue drop; warned of $1B in tariff-driven costs for FY26 but shares rose 10% on signs of stabilization4.
• S&P 500 closed just 0.05% below its record high, buoyed by Fed rate-cut expectations and easing geopolitical concerns7.
• Congress will scrap Section 899 “revenge tax” after a G7 pact, reducing risk of U.S.–EU digital tax disputes3.
• Trump introduced the “One Big Beautiful Bill,” proposing tax cuts, expanded child tax credits, and stricter immigration measures9.
• EU leaders are reviewing a new U.S. trade offer as a July 9 tariff deadline approaches; divisions remain within the bloc11.
• Uber is in early talks to help finance Travis Kalanick’s bid for Pony.ai’s U.S. robotaxi unit; Pony.ai shares surged 15%12.
• Banxico cut its policy rate by 50bps to 8.0% amid persistent growth and inflation concerns8.
• U.S. and Israel plan to demand Iran surrender its enriched uranium after strikes on Iranian nuclear sites; most uranium remains unaccounted for56.
• Supreme Court ruled states can block Medicaid funds to Planned Parenthood, impacting healthcare access in some states15.
• California is moving to declare online fantasy sports illegal, raising regulatory risk for gambling and DFS operators14.

Commentary

U.S.–China trade developments dominated the session, with Trump announcing a new bilateral deal and a specific accord to accelerate rare earth mineral exports12. This is a direct positive for U.S. tech, defense, and manufacturing sectors that have faced input shortages and cost volatility2. However, the lack of detail and ongoing tariff regimes mean traders should remain cautious about the durability of these supply chain improvements12.

Nike ’s earnings demonstrated that even with declining sales and a significant tariff headwind projected for next year, investors are willing to reward signs of operational stabilization and credible mitigation strategies4. The 10% after-hours jump in Nike shares reflects relief that the worst may be over for the company, and by extension, offers some optimism for other U.S. consumer multinationals navigating China exposure and tariff impacts4.

Macro sentiment remains constructive. The S&P 500 ’s close just shy of a record, alongside falling Treasury yields and a softer dollar, underscores growing market conviction that the Fed will cut rates soon—possibly as early as July710. This is supporting risk assets and could further weaken the dollar if Friday’s PCE inflation data confirms cooling price pressures7. Banxico’s rate cut is consistent with the global tilt toward monetary easing, but persistent inflation and trade uncertainty keep FX volatility in play, especially for emerging markets8.

On the policy front, Congress’s move to drop the Section 899 “revenge tax” following the G7 pact removes a near-term risk for U.S. tech giants with European exposure3. Meanwhile, the EU is under deadline pressure to respond to Washington’s latest trade proposal, with the risk of steep new U.S. tariffs on European exports if talks stall11. Traders should monitor headlines for any sign of a breakthrough or breakdown before the July 9 deadline11.

Sector-specific risks remain active. The Supreme Court’s Medicaid ruling could impact healthcare providers in several states15, while California’s push to ban online fantasy sports signals rising regulatory headwinds for gambling and DFS platforms14. The U.S.–Israel demand for Iran to surrender uranium keeps a geopolitical floor under energy, but immediate market impact appears limited56.