The major assets struggled for direction on Thursday as traders weighed upbeat earnings from Microsoft and Meta against rising tariff risks and month-end volatility.
U.S. data beats and central bank updates added fuel to sharp moves in equities, currencies, and commodities ahead of Friday’s NFP.
Here are headlines you may have missed in the last trading sessions!
Headlines:
- U.S. President Trump announced trade deal with South Korea, which includes a 15% tariff and $350B investment in the US at Trump’s discretion
- Japan industrial production prel for June: 1.7% m/m (–0.3% m/m forecast; –0.1% m/m previous); 4.0% y/y (–0.8% y/y forecast; –2.4% y/y previous)
- Japan retail sales for June: 1.0% m/m (0.0% m/m forecast; –0.2% m/m previous); 2.0% y/y (2.5% y/y forecast; 2.2% y/y previous)
- BOJ kept its policies unchanged as expected in July
- BOJ Gov. Ueda hinted there would be no immediate interest rate hike despite improved economic outlook
- Australia building permits prel for June: 11.9% m/m (1.2% m/m forecast; 3.2% m/m previous)
- Australia private house approvals prel for June: –2.0% m/m (0.2% m/m forecast; 0.5% m/m previous)
- Australia retail sales for June: 1.2% m/m (0.3% m/m forecast; 0.2% m/m previous)
- China NBS manufacturing PMI for July: 49.3 (49.9 forecast; 49.7 previous); Non-manufacturing PMI at 50.1 (50.5 forecast; 50.5 previous)
- Swiss retail sales for June: 3.8% y/y (0.5% y/y forecast; 0.0% y/y previous); 1.5% m/m (0.4% m/m forecast; –0.6% m/m previous)
- U.S. Challenger job cuts for July: 62.08k (71.0k forecast; 48.0k previous)
- Germany inflation rate prel for July: 2.0% y/y (1.9% y/y forecast; 2.0% y/y previous); 0.3% m/m (0.2% m/m forecast; 0.0% m/m previous)
- Canada GDP prel for June: 0.1% m/m (–0.3% m/m forecast)
- U.S. employment cost index for Q2 2025: 0.9% q/q (0.8% q/q forecast; 0.9% q/q previous)
- U.S. initial jobless claims for July 26, 2025: 218.0k (220.0k forecast; 217.0k previous)
- U.S. core PCE price index for June: 2.8% y/y (2.8% y/y forecast; 2.7% y/y previous); 0.3% m/m (0.3% m/m forecast; 0.2% m/m previous)
- U.S. core personal consumption expenditure for June: 2.6% (2.5% forecast; 2.3% previous)
- U.S. President Trump extends tariff pause for Mexico for 90 days
Broad Market Price Action:
Dollar Index, Gold, S&P 500, Oil, U.S. 10-yr Yield, Bitcoin Overlay Chart by TradingView
Markets were all over the place on Thursday as traders tried to balance strong Big Tech earnings with growing jitters over Trump’s midnight tariff deadline. Add in a dose of month-end profit-taking, and you’ve got yourself a choppy session.
Over in Europe, equities had a rough go. The Stoxx 600 slipped 0.75%, while Germany’s DAX and France’s CAC 40 took heavier hits. The FTSE 100 fared better, managing to stay mostly afloat and ending just a tick lower.
Stateside, Wall Street got an early boost from blockbuster results out of Microsoft and Meta, pushing the S&P 500 and Nasdaq to fresh highs. But traders started squaring up ahead of Friday’s NFP release, and the rally fizzled. The S&P gave back 0.4%, the Dow lost 0.7%, and the Nasdaq basically flatlined.
Gold got a lift from early dollar weakness, climbing to $3,290 an ounce. Treasury yields jumped back to Wednesday’s highs near 4.38% after some surprisingly strong mid-tier data. Crude oil declined over 1% to $69.28 per barrel on concerns about slowing energy demand in a high-tariff global economy. Bitcoin followed risk assets lower, slipping to $115,600.
FX Market Behavior: U.S. Dollar vs. Majors:
Overlay of USD vs. Majors Chart by TradingView
The dollar started Thursday on the back foot during Asian hours as traders took a cautious stance ahead of Trump’s midnight tariff deadline. Trade headlines set the early tone, with Trump announcing a deal with South Korea that included a 15% tariff rate, which offered a bit of relief to risk sentiment. USD/JPY saw some weakness out of the gate as markets reacted to the BOJ’s more upbeat economic outlook.
The Greenback found its legs during European hours after BOJ Governor Ueda played down the need for immediate action despite higher inflation forecasts. That dovish shift sent USD/JPY climbing from around 148.65 back above 150.00, possibly lifting the dollar across the board. Month-end flows and positioning ahead of Friday’s jobs report also likely added fuel to USD’s bullish momentum.
Price action got a little choppier in the U.S. session. Mexico secured a 90 day extension on its current tariff deal, and the Challenger report showed job cuts jumped to 62,075 in July from 47,999. Core PCE rose 0.3% on the month and 2.8% on the year, which initially helped the dollar. But profit taking set in later in the day, and the dollar finished mixed. It closed down against EUR and CHF but up against the other majors.
Upcoming Potential Catalysts on the Economic Calendar
- U.K. Nationwide Housing Prices for July at 6:00 am GMT
- Australia Commodity Prices for July at 6:30 am GMT
- Swiss procure.ch Manufacturing PMI for July at 7:30 am GMT
- France HCOB Manufacturing PMI Final for July at 7:50 am GMT
- Germany HCOB Manufacturing PMI Final for July at 7:55 am GMT
- Euro Area HCOB Manufacturing PMI Final for July at 8:00 am GMT
- U.K. S&P Global Manufacturing PMI Final for July at 8:30 am GMT
- Euro Area CPI Flash for July at 9:00 am GMT
-
U.S. Nonfarm Payrolls for July at 12:30 pm GMT
- U.S. Participation Rate for July at 12:30 pm GMT
- U.S. Average Weekly Hours for July at 12:30 pm GMT
- U.S. Unemployment Rate for July at 12:30 pm GMT
- Canada S&P Global Manufacturing PMI for July at 1:30 pm GMT
- U.S. S&P Global Manufacturing PMI Final for July at 1:45 pm GMT
- U.S. ISM Manufacturing PMI for July at 2:00 pm GMT
- U.S. Michigan Inflation Expectations Final for July at 2:00 pm GMT
Traders have another full plate today with PMI reports rolling in from the major economies, just before Uncle Sam drops the latest jobs numbers.
We know from Powell’s presser that the Fed head honcho is watching the unemployment rate closely for policy direction. Today’s releases could crank up volatility for the U.S. dollar and other majors, so make sure you don’t miss these potential market movers!
As always, stay nimble and don’t forget to check out our Forex Correlation Calculator when taking any trades!
