TL;DR

US ramps tariffs on India, copper, and EU goods; BOJ holds rates; Microsoft, Meta post strong AI-driven earnings.

Highlights

• China’s cyber regulator summoned Nvidia over alleged “backdoor” vulnerabilities in H20 AI chips, raising risks for US tech exports.1
• Trump imposed a 50% tariff on US copper semi-finished imports (excluding refined copper), triggering a 19.5% drop in COMEX copper futures.2
• US to levy 25% tariff on all Indian goods from August 1, with extra penalties threatened over Russian oil imports; rupee and Gift Nifty futures fell.3
• Indian state refiners paused spot Russian crude purchases amid narrowing discounts and US tariff threats, shifting to Middle Eastern and West African oil.8
• US and South Korea reached a trade deal: 15% tariff on Korean goods (down from 25%), $350B Korean investment, and $100B in US energy purchases.4
• Trump ended the global duty-free “de minimis” exemption for low-value imports from August 29, impacting e-commerce and logistics costs.6
• US Treasury announced its largest Iran-related sanctions package since 2018, targeting over 115 entities and vessels, including several Indian firms.79
• BOJ held policy rate at 0.5% and raised inflation forecasts, supporting the yen and pushing up JGB yields.5
• Microsoft and Meta beat earnings estimates on AI-driven growth, signaling higher capex; shares surged in after-hours trading.15
• UK regulator accused Microsoft and Amazon of stifling cloud competition, recommending a market investigation.14
• China’s polysilicon makers plan a $7B fund to close surplus capacity and stabilize solar material prices.13
• US set a 15% tariff on EU wine and spirits from August 1, increasing trade friction with Europe.17

Commentary

US trade policy is driving volatility across commodities, currencies, and equities. The copper tariff, while narrower than previously proposed, led to a sharp correction in futures and pressure on US producers, while sparing major exporters of refined copper like Chile and Peru.2 The 25% tariff on Indian goods, combined with threats of further penalties over Russian oil, has weakened the rupee and Indian equity futures, and prompted Indian state refiners to pause Russian crude purchases—potentially tightening supply for global oil markets and shifting flows toward Middle Eastern and African grades.38

The US-South Korea trade agreement, with a reduced 15% tariff and a $350B Korean investment commitment, removes near-term uncertainty for Korean exporters and secures significant US energy exports.4 Meanwhile, the end of the “de minimis” exemption will raise compliance costs for e-commerce and logistics firms, particularly ahead of the peak holiday season, and could affect consumer imports and retail margins.6

In tech, China’s scrutiny of Nvidia ’s H20 chips adds uncertainty for US semiconductor exports to China,1 while Microsoft and Meta ’s strong earnings underscore the ongoing AI-driven rally in US mega-cap tech.15 However, the UK’s competition probe into Microsoft and Amazon ’s cloud operations introduces fresh regulatory risk for the sector.14 China’s move to cut polysilicon capacity aims to stabilize solar input prices after a period of oversupply and price declines, which could support global solar equities.13

The BOJ’s decision to hold rates but upgrade inflation forecasts has strengthened the yen and nudged JGB yields higher, with traders now watching for potential tightening later this year.5 On the geopolitical front, the US’s largest Iran sanctions package since 2018, including actions against Indian firms, signals a tougher stance on energy flows and secondary sanctions risk, adding another layer of complexity to global oil and shipping markets.79