Market Report: Trade talk heats up as 90-day window approaches
Matt Britzman, senior equity analyst, Hargreaves Lansdown: “Trade talk is heating up again as president Trump’s 90-day pause on reciprocal tariffs nears its end. Markets are starting to see that Trump’s bark is worse than his bite, with news that the White House might dial back its tariff plans to avoid reigniting a global trade war the latest example of a softer touch. European markets have had a choppy open this morning, but the FTSE 100 managed to edge out some gains, as investors try and gauge what’s to come.
Standard Chartered is facing a $2.7bn lawsuit tied to the siphoning of funds from Malaysia’s sovereign wealth fund, as liquidators allege the bank enabled over 100 shady transfers between 2009 and 2013. The bank ‘emphatically rejects’ the claims, though it was previously fined $4 million in 2016 over related anti-money laundering breaches. While it’s tough to gauge the lawsuit’s outcome, the potential hit – about 7% of market cap – is likely enough to weigh on shares in the short term.
June ended with a roar across the pond as a late-day rally pushed the S&P 500 to a fresh all-time high. The index is now up 28% from its 7 April lows, making the second quarter of 2025 the strongest since December 2023, fuelled by strength in tech and growth stocks. That’s even as investors eye Thursday’s jobs report, Fed signals, and global trade tensions. Tariff news added to the momentum as Canada dropped its digital services tax, the EU agreed to Trump’s proposed 10% tariff (with caveats), and the ‘Big Beautiful Bill’ continued advancing through the Senate.
Tesla investors need to buckle up as Elon Musk and President Trump are at it again, trading barbs on social media. Musk is furious over the ‘Big Beautiful Bill’ and its hit on US finances, while Trump has issued his usual rebuttal about the subsidies Musk’s companies have received. With delivery numbers coming soon and Tesla’s core auto business facing tough competition, this political drama could reignite the bear narrative just as shares were starting to recover. Investors would have been hoping for a drama-free ride through 2025 given the weakening short-term outlook, patiently waiting for the Cybercab launch in 2026 to catalyse the next phase of growth.
Oil is trading flat this morning with Brent hovering around $66.30 as fears of oversupply weighed on the market. OPEC+ is reportedly set to boost production by another 411,000 barrels per day in August – part of a broader push led by Saudi Arabia to punish overproducers and regain market share from US shale. Easing geopolitical tensions, a steady Israel-Iran ceasefire, and tariff uncertainty ahead of the 9 July deadline added more pressure, with treasury secretary Scott Bessent warning of potential hikes despite ongoing talks.”
The author holds shares in Tesla.
Aarin Chiekrie, equity analyst, Hargreaves Lansdown: “Sainsbury’s made its way onto more customers’ shopping lists in the first quarter. It continues to pinch market share off the competition, reaching its highest total in almost a decade. With more trolleys rolling toward its tills, the nation’s second largest supermarket saw like-for-like sales rise 4.7% in the period. In part, that’s thanks to a herculean effort to improve its range, quality and value perception in recent times. And expanding its Taste the Difference range, ALDI price match and Nectar prices across even more products is helping to keep existing customers loyal.
Despite the top line moving higher, recent changes to employers’ National Insurance and minimum wages are set to bring at least £140m of extra costs this year. Sainsbury’s is doing what it can to trim costs throughout the business, including closing its in-store cafes and streamlining behind-the-scenes operations, but the group’s guidance still points to full-year underlying retail profits remaining broadly flat at around £1bn.
Trading, so far, has been promising, and while it’s still early in the group’s financial year, signs of an all-out price war among the major supermarkets hasn’t materialised. If that remains the case through the rest of the year, the current profit guidance looks a touch conservative, so there could be some positive surprises for investors who are willing to remain patient.”