Tariffs 2.0 Kick in, Stocks Muted Response

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Main Content:

1.    Major indexes weekly performance 

2.    U.S stocks weekly wrap 

3.    S&P 500 sector index weekly/month performance 

4.    China/Hong Kong stocks weekly wrap 

5.    Singapore stocks weekly wrap 

6.    Major indexes weekly chart and technical support & resistance levels

U.S.

For the week of Jul 11, U.S. stocks finished the week mostly lower, with the tech-heavy Nasdaq Composite Index(COMP) holding up best. Tariff news dominated the headlines, but market reaction was muted compared with previous tariff announcements. There was little difference in performance between large-caps and small-caps, while growth stocks held up modestly better than value. In single-stock news, NVIDIA hit the $4 trillion market capitalization threshold for the first time, helping put the “mega” in the so-called Magnificent Seven group of mega-cap stocks. Refer to below major indexes weekly performance tables.

Key highlights for the week and next:

1.    New tariffs were announced this week on more than 20 countries, with the 90-day pause extended to August 1. Tariff rates vary widely — from 20%-50% — to be applied on August 1 unless countries reach trade deals sooner. 

2.    FOMC’s mid-June  meeting minutes show disagreement about policy direction. While “most” policymakers said that they anticipate cutting rates this year, two stated that they would be open to rate reductions as soon as the late-July FOMC meeting. Stocks showed little reaction to the FOMC minutes. 

3.    NVIDIA hit the $4 trillion market capitalization threshold for the first time in the week, helping put the “mega” in the so-called Magnificent Seven group of mega-cap stocks. NVDA closed at $164.92 by the week.

SPX sectors in play

Five out of the 11 SPX sectors recorded weekly gains, Energy(XLE) and Industrails(XLI) were among top gainers, while Financials (XLF) and Communication Services(XLC) lagged. Refer to below SPX sectors ETF weekly performance table.

Indexes technical levels

Stocks held near record highs set this week, aided by strong performance in the energy and industrial sectors that helped offset the risk-off sentiment driven by tariff headlines. Nasdaq(COMP) and SPX have been holding up quite well near record highs, while DJI retreated 1.02% near its all-time high. Click below three indexes for their weekly charts.

DJI weekly chart

SPX weekly chart

Nasdaq weekly chart

China/HK

Mainland China stock markets rose as data showing persistent deflation spurred hopes for more stimulus. The Shanghai Composite Index(SSE) added 1.09% and the blue-chip CSI 300 gained 0.82%. In Hong Kong, the benchmark Hang Seng Index edged up 0.93%. (refer to the above weekly performance table).

Key highlights for the week and outlook for China/HK:

1.    The producer price index fell 3.6% in June from a year earlier, the country’s statistics bureau reported Wednesday. June’s decline was worse than economists’ forecasts and marked the 33rd month of factory deflation, as well as the biggest drop for producer prices in nearly two years, according to Bloomberg. The consumer price index unexpectedly rose 0.1%, snapping a four-month streak of declines. However, analysts said the increase was likely driven by recent stimulus measures rather than a sustained improvement in consumer confidence. 

2.    The latest inflation report raised the possibility that China’s leaders may roll out more stimulus to lift the economy out of a persistent cycle of falling prices, corporate profits, and wages. Earlier in July, officials at a high-level economic meeting chaired by China’s President Xi Jinping pledged to crack down on “disorderly” low-price competition and phase out outdated industrial capacity, Bloomberg reported, citing state-run media. The report underscored the urgency that China’s leaders have assigned to tackling deflation resulting from weak domestic demand.

Refer to below .HSI stocks top 40 performance of the week.

Click below SSE and .HSI indexes for their weekly charts. 

SSE weekly chart

.HSI weekly chart

Singapore

The Straits Times Index (STI) gained further 1.85% to close at 4087.81 point this week. The index has crossed its 4100 level intra-week for the first time, and on the up streak for 3^rd week consecutively which is remarkable. The uptrend is steady technically, with further upward move expected.

Refer to below table for STI index stocks weekly performance.

Click below for STI weekly chart.

STI weekly chart

Source: Some contents and data excerpted from various public market reports. Please comment to claim copyright ownership of any material, and I will remove it if necessary.