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Market Review

US:

Wall Street's major indexes closed sharply lower on Monday, after U.S. President Trump announced hefty tariffs against Japan, South Korea and other trading partners while Tesla shares sank after CEO Musk said he was forming a new U.S. political party.

Asia:

Asian shares edged higher as President Trump left the door open for additional negotiations after imposing new tariff rates on partners including Japan and South Korea.

India:

Benchmark indices ended flat with Nifty hovering around 25,450 as investors turned cautious ahead of likely development around the US-India trade deal expected later this evening. Broader indices underperformed the main indices with Nifty Midcap index down 0.27%, while smallcap index shed 0.4%. Market is expected to open on a flattish note and likely to witness a range bound move during the day.

Global Economy:

Trump said that the Aug?1 deadline for imposing reciprocal tariffs is "not 100% firm,” and he’s open to alternate proposals if trade partners request changes. Earlier, Trump signed an executive order extending the Jul?9 deadline to Aug.?1. Also, he announced new tariff rates on 14 nations, incl. Japan, Indonesia, South Korea, Serbia, and Tunisia, warning that duties of 25% on key allies such as Japan and South Korea will take effect if no deals are struck. Notably, the higher tariffs will not combine with previously announced sector tariffs such as those on automobiles, steel, and aluminum.

German industrial production rose by 1.2% in May, beating expectations of flat growth, driven by the automotive and energy sectors. However, April’s output was revised down to a 1.6% drop. Over March–May, production was up 1.4% from the prior three months. This comes despite a 1.4% fall in May industrial orders, mainly due to weaker euro zone demand. Eurozone retail sales fell 0.7% MoM in May, adding to signs of economic weakness in the second quarter of the year. The decline in retail sales coincided with a 0.3% decrease in overall services activity in April.

Commodities:

Oil prices eased on Tuesday after rising almost 2% in the previous session, as investors assessed new developments on U.S. tariffs and a higher-than-expected OPEC+ output hike for August.

Gold prices steadied on Tuesday as U.S. President announced sharply higher tariffs on goods from Japan, South Korea and other nations, while higher U.S. treasury yields capped gains.

Currency:

The dollar jumped the most in three weeks after President Donald Trump unveiled a wave of proposed tariffs, a sign investors are confident the US economy can largely withstand the impact of trade disputes.

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