TL;DR

Trump tariff threats hit EU/Korea; TSMC, GE, PepsiCo beat; BlackRock Bitcoin ETF tops $80B.

Highlights

• Markets briefly swung after reports Trump may fire Fed Chair Powell; dollar dropped, yields rose, but moves reversed as White House downplayed action1.
• Trump threatens 30% tariffs on European goods2 and 25% on Korean imports from August 118; EU and South Korea warn of economic fallout218.
• TSMC posts record Q2 profit (+61% YoY) and raises 2025 outlook on AI demand; flags FX and US tariff risks6.
• GE Aerospace beats Q2 estimates, raises 2025 profit guidance8; PepsiCo beats on earnings, reaffirms outlook despite North America softness9.
• BlackRock ’s Bitcoin ETF (IBIT) surpasses $80B in assets15; spot Ethereum ETFs set record $720M daily inflows16.
• Novartis beats earnings, raises guidance, and launches $10B buyback11; Pfizer and Bristol-Myers cut Eliquis price 40% via direct sales to US patients10.
• Couche-Tard drops $47B bid for Japan’s Seven & i after talks stall; Seven & i shares fall sharply7.
• NATO prepares rapid transfer of Patriot missile batteries to Ukraine5; US review finds Iran airstrikes destroyed only one nuclear site4.
• Major Russian banks consider state bailouts amid rising bad loans12.
• Chinese hackers double cyberattacks on Taiwanese chip firms and US investment companies19.

Commentary

US traders enter the session with heightened sensitivity to political and trade risks. Reports that President Trump may fire Fed Chair Powell triggered a brief bout of volatility in the dollar and Treasuries, though markets stabilized as the White House signaled no imminent move1. This episode highlights ongoing concerns around Fed independence, but Fed officials reiterated the dollar’s reserve status, offering some reassurance to rates and FX markets20.

Trade policy is a key market driver today. Trump's threats of steep tariffs on European2 and Korean imports18, set to begin August 1, have prompted warnings from the EU and South Korea and are already impacting supply chains and corporate planning218. Sectors exposed to global trade—autos, semiconductors, and consumer goods—face increased uncertainty, as seen in Volvo’s decision to shift US-bound production stateside17 and the stockpiling of Korean cosmetics18.

Corporate earnings remain a bright spot. TSMC ’s strong results and raised outlook underscore persistent AI demand, though management cautioned on FX and tariff headwinds6. GE Aerospace and PepsiCo both topped estimates, with GE notably lifting its 2025 profit guidance89. Novartis ’ earnings beat and buyback plans11, alongside a 40% price cut for Eliquis by Pfizer and Bristol-Myers 10, add momentum in healthcare. In crypto, BlackRock ’s Bitcoin ETF growth15 and record Ethereum ETF inflows16 highlight robust institutional demand.

Geopolitical developments remain on the radar. NATO is preparing to transfer Patriot batteries to Ukraine5, while US strikes on Iranian nuclear sites were less effective than initially claimed, raising the risk of further action4. Russian financial sector stress12 and a surge in Chinese cyberattacks on Taiwanese chipmakers and US investment firms19 add to the global risk backdrop.