Highlights

• US and UK announce a comprehensive trade deal, cutting steel and car tariffs; GBP rises 0.4% vs USD ahead of 3pm UK press conference1.
• Trump administration to rescind AI chip export curbs; Nvidia shares jump 4%, boosting the semiconductor sector2.
• Alphabet (Google) drops 9% as Apple explores AI search alternatives for Safari, threatening a $20B annual deal3.
• Bank of England cuts rates by 25bps to 4.25% (5-2-2 vote), citing tariff drag on growth; signals dovish tilt4.
• US Treasury and Trade Rep to meet China’s He Lifeng in Switzerland amid 145%/125% tariff standoff; Trump rules out tariff cuts, Fed warns of stagflation risks515.
• India launches strikes on Pakistan after Kashmir attack; Pakistan stock market crashes 5.78% and trading halts, while Indian equities remain resilient67.
• North Korea fires multiple short-range missiles into Sea of Japan; regional military tensions rise8.
• Trump halts US airstrikes in Yemen after Houthi ceasefire brokered by Oman; Red Sea shipping risk eases9.
• BYD and Tsingshan scrap $523M lithium projects in Chile after price collapse; Amazon Web Services commits $4B to new Chile cloud region1113.
• Shionogi to acquire Torii Pharma for $1.05B; NTT to buy NTT Data in $20B AI-driven consolidation12.
• Stripe launches AI payments model, stablecoin accounts in 101 countries, and orchestration tools; highlights migration with Nvidia 20.
• Riksbank and Norges Bank hold rates steady but signal cuts likely in 2025; Swedish and Norwegian currencies steady17.

Commentary

Today’s session is dominated by a flurry of trade, tech, and geopolitical headlines, each with distinct implications for global markets. The US-UK trade deal marks the Trump administration’s first major economic agreement, providing a modest boost to the pound and potentially setting a template for further bilateral deals1. The Bank of England’s rate cut, justified by tariff-related growth concerns, underscores the real economic drag from ongoing trade wars, even as the UK secures some tariff relief from the US4. Meanwhile, US-China trade tensions remain entrenched, with Trump refusing to budge on punitive tariffs and the Fed warning of stagflation risks515. This backdrop will keep currency and rates traders focused on central bank signals and trade negotiation headlines.

In equities, tech remains volatile. Alphabet ’s sharp selloff on fears of losing its lucrative Apple search deal highlights how quickly AI-driven disruption can hit legacy revenue streams3. Conversely, Nvidia and the semiconductor sector rallied on news that the US will pause AI chip export curbs, removing a near-term overhang on overseas sales2. M&A activity in Japan (Shionogi/Torii, NTT/NTT Data)12 and Stripe (not listed) fintech innovations signal continued structural shifts in healthcare, IT, and payments, with AI as a central theme20. Watch for rotation within tech as regulatory and competitive risks are repriced.

Geopolitically, the India-Pakistan flare-up has hammered Pakistani assets but left Indian equities largely unscathed, highlighting divergent investor confidence and the insulation provided by foreign inflows and stable macro conditions in India67. North Korea’s missile launches8 and the fragile Ukraine ceasefire add to global risk14, but so far have had limited direct market impact. The US-Houthi ceasefire should ease Red Sea shipping risk, potentially capping insurance and freight costs in the region9.

Commodities are in focus as lithium prices force Chinese majors to abandon Chilean projects, raising questions about the pace of battery supply chain investments11. Meanwhile, AWS ’s $4B bet on Chile’s digital infrastructure is a bullish signal for Latin American tech and cloud adoption13. In FX, central banks in Sweden and Norway are holding fire but signaling cuts, keeping the SEK and NOK steady for now17.

Traders should watch for further details from the US-UK trade press conference, developments from US-China talks in Switzerland, and any escalation in South Asia or Eastern Europe. Tech sector volatility remains high—expect further rotation as the AI arms race and regulatory environment evolve. Stay nimble as central banks react to trade-driven growth headwinds and as geopolitics inject episodic volatility across asset classes.