On Friday, July 4, 2025, U.S. financial markets were closed in observance of Independence Day. On July 3, 2025, U.S. stock markets closed higher, buoyed by a stronger-than-expected June jobs report. The S&P 500 and Nasdaq Composite both reached new record highs, while the Dow Jones Industrial Average also posted gains. The shortened trading session, ahead of the Independence Day holiday, saw increased investor optimism:

• Nasdaq Composite Index closed at 20,601.10, unchanged on the day and up 1.62% for the week.
• NYSE Composite Index closed at 20,725.79, unchanged on the day and up 1.90% for the week.
• S&P 500 Index closed at 6,279.35, unchanged on the day and up 1.72% for the week.
• Dow Jones Industrial Average EW closed at 14,037.93, unchanged on the day and up 2.22% for the week.

European markets faced downward pressure amid escalating trade tensions following U.S. President Donald Trump’s announcement of new tariffs. The U.S. plans to issue letters detailing tariffs ranging from 10% to 70%, with the first batch expected on July 4.

• Stoxx Europe 600 Index closed at 541.13, down 0.48% on the day and down 0.46% for the week.
• DAX Performance Index closed at 23,787.45, down 0.61% on the day and down 1.02% for the week.
• CAC 40 Index closed at 7,696.27, down 0.75% on the day but up 0.06% for the week.

Asian markets exhibited mixed performance, influenced by the looming U.S. tariff deadline:

• Nikkei 225 Index closed at 39,810.88, up 0.06% on the day but down 0.85% for the week.
• Hang Seng Index closed at 23,916.06, down 0.64% on the day and down 1.52% for the week.
• Shanghai Composite Index closed at 3,472.32, up 0.32% on the day and up 1.40% for the week.
• Australia S&P/ASX 200 Index closed at 8,603.00, up 0.08% on the day and up 1.04% for the week.

• The Dollar Index (DXY), a closely watched gauge of the U.S. dollar’s performance against other major currencies, closed at 96.99, down 0.14% on the day, down 0.29% for the week, and down 10.57% year-to-date.
• The Brent crude oil, the global oil price benchmark, settled at $68.28 per barrel, declining 0.52% on the day but gaining 2.22% over the week, though still down 8.52% year-to-date.
• The Gold rose to $3,335.24 per ounce, up 0.27% on the day, up 2.05% for the week, and showing a strong year-to-date increase of 27.09%.
• The 2-year U.S. Treasury yield particularly responsive to Federal Reserve policy rates, held steady at 3.89 basis points, unchanged on the day but up 14.40 basis points for the week, and down 36.00 basis points year-to-date.
• The 10-year U.S. Treasury yield, an indicator of long-term borrowing costs, remained flat at 4.35 basis points, with no daily change, a 6.60 basis point increase over the week, and a year-to-date decline of 22.50 basis points.

Investors will closely watch trade developments in the U.S. as the July 9 deadline approaches, marking the end of the tariff pause announced in April. The Trump administration has started sending formal letters to trading partners detailing the tariff rates they will face. So far, only a few deals have been finalized, notably with the UK, Vietnam, and a framework agreement with China.

The second quarter earnings season begins in mid-July, with early reports from Delta Air Lines and Conagra Brands. Attention will also focus on the release of the FOMC minutes, as traders seek further insight into the Federal Reserve’s policy direction for the rest of the year. Fed Chair Powell continues to adopt a cautious, wait-and-see stance. Economically, the U.S. calendar remains relatively light, with key figures including weekly jobless claims, consumer credit, the NFIB Small Business Sentiment Index, and the federal government’s monthly budget statement.

The next release, covering the week ending July 5 (to be published on Thursday, July 10), is forecast at around 240,000 new claims, according to consensus estimates. The previous week’s actual claims were 233,000, which was lower than the 240,000 forecast and down from 237,000 the prior week.

Analysts typically view a figure below expectations as encouraging for the U.S. labor market, indicating potential strength. Conversely, the number above forecast could raise concerns about softening employment and weigh on investor sentiment.

The Federal Reserve remains cautious, watching for any sign of labor market softening that could justify further rate cuts later this year. A sudden uptick in claims might strengthen the case for policy easing.

In Canada, June employment figures and the Ivey PMI will be published. Mexico’s inflation data and Brazil’s inflation, retail sales, and business confidence updates will also draw market attention.

Germany’s industrial production unexpectedly rose by 1.2% month-over-month in May 2025, beating market expectations of flat growth.

Euro Area retail sales fell by 0.7% month-over-month in May 2025, the steepest decline since August 2023, following an upwardly revised 0.3% gain in April and in line with market expectations. The drop was driven by weaker demand.

Key releases include trade balance data for Germany and France, Germany’s wholesale prices, and Turkey’s industrial production. Switzerland will publish consumer confidence figures, and Russia will report its inflation rate. Final June inflation data for Germany, Italy, and France will also be in focus.

In the UK, markets will look to monthly GDP, industrial production, trade balance, and Halifax’s house price index.