TL;DR

Trump imposes 30% EU/Mexico tariffs; S&P 500 breadth weak; US layoffs, crypto, and trade risks in focus.

Highlights

• Trump to impose 30% tariffs on all EU and Mexico imports from Aug. 1; EU preparing retaliatory measures, truce extended until August 12.
• S&P 500 market breadth at 20-year low; rally driven by tech megacaps, US market cap-to-GDP at 207% 3.
• Record $155B retail inflows into US equities in H1 2025, focused on NVIDIA , Apple , Tesla 3.
• US job cuts at 744,308 in H1 2025 (highest since 2020); retail layoffs up 255%, tech up 27%, YTD bankruptcies at 371 4.
• Bitcoin hits $112,000 record on strong ETF inflows and $1B in short liquidations; Ethereum and memecoins also rally 5.
• Google pays $2.4B for Windsurf AI tech license, hiring key talent to boost DeepMind’s Gemini models 7.
• SpaceX invests $2B in Musk’s xAI as part of a $5B capital raise, deepening Musk company ties in AI 8.
• North Korea supplies Russia with 12M artillery shells, 28,000 containers, and up to 30,000 troops; pledges full support for Russia in Ukraine 16.
• Pentagon presses Japan and Australia for clarity on roles in potential Taiwan conflict 11.
• US to accelerate arms shipments to Ukraine ahead of Trump’s Russia policy statement; bipartisan push for new sanctions on Russia 12.
• Israeli strikes intensify in Gaza as ceasefire talks stall; UN warns fuel shortages threaten aid and hospitals 1520.
• Putin signals support for Iran nuclear deal restricting enrichment; Iran confirms president slightly injured in June Israeli strike 1314.

Commentary

US markets open to heightened uncertainty as Trump’s sweeping 30% tariffs on EU and Mexican imports threaten to disrupt key supply chains and invite retaliation 12. The EU’s extension of its tariff truce to August buys limited time for negotiations, but the risk of a broader trade conflict is high 2. Sectors with significant exposure to transatlantic and cross-border trade—autos, machinery, and agriculture—face immediate downside risk. US exporters could see headwinds if countermeasures are enacted 1.

Despite S&P 500 highs, underlying market breadth is historically weak, with gains concentrated in a handful of tech names 3. Retail investors have driven record inflows, but high valuations (S&P 500 forward PE at 22) and increasing layoffs—especially in retail and tech—underscore fragility 34. The surge in corporate bankruptcies and downward revisions to employment data point to softening economic conditions, raising the risk of a correction if megacap momentum stalls 4.

Crypto markets remain strong, with Bitcoin and Ethereum rallying on robust ETF inflows and short squeezes 5. The $500M Pump.fun token sale highlights continued speculative appetite in digital assets, which may attract further flows as traders seek alternatives to stretched equity valuations 6.

Geopolitical risk remains elevated. North Korea’s direct military support for Russia and the Pentagon’s push for allied commitments in the Indo-Pacific add to global uncertainty 1116. Accelerated US arms shipments to Ukraine and intensifying conflict in Gaza could impact defense and energy sectors 121520. Meanwhile, Google and SpaceX’s AI investments reflect ongoing competition for tech leadership, but are unlikely to move broader markets short-term 78.

Traders should watch for headlines on US-EU/Mexico trade negotiations, labor market data, and any signs of rotation out of tech. Defensive positioning and attention to sectors exposed to trade and geopolitical risk are warranted.