US tariff update fails to rattle global markets, and other finance news to know

By Admin

11 Jul, 2025

Muted Market Response Despite Sharp Tariff Threats

In a turn of events that could have sent global financial markets into turmoil, the latest US tariff announcements on imports from 14 countries have surprisingly produced only a subdued reaction across the board. President Trump's confirmation of letters sent to nations including Japan and South Korea, threatening tariffs ranging from 25% to 40% by August 1 unless new trade deals are struck, barely shook investor confidence.

Major indices like the S&P 500 and Nasdaq rebounded from initial losses, while the Dow saw only a modest decline. According to CNN, investors appear to be absorbing the news with cautious optimism, likely anticipating a potential pullback or renegotiation before the deadline. European and Asian markets mirrored this stability, showing minimal disruption.

Key tariff figures, highlighted by NPR, include:

• A 10% minimum tariff on nearly all US imports, with Chinese goods facing 30%.
  
  

• $30 billion in tariff revenue collected in June triple that of March.
  
  

• Tariffs up to 49% planned for countries without trade deals by August 1.
  
  

• UK and Viet Nam secured deals with lower rates (10% and 20%, respectively).
  
  

• The EU may face tariffs of up to 50% currently at 10%.
  
  

• Steel/aluminium tariffs stand at 50% (25% for the UK); autos at 25%.
  
  

• New levies are under consideration for semiconductors, copper, pharmaceuticals, and lumber.
  
  

Despite the muted market reaction, bond yields have risen slightly, indicating some underlying investor concerns regarding long-term fiscal impacts. Legal challenges under the International Emergency Economic Powers Act are also underway, adding a layer of complexity. Analysts warn that prolonged uncertainty could gradually impact investment and consumer spending.

ASEAN Economies Shift Gears Amid Trade Friction

While Western markets seem largely unshaken, the tone in Asia is one of proactive adaptation. At the Reuters NEXT Asia summit, business leaders shared insights on strategic shifts in supply chains and investment flows in response to evolving US trade policy.

Notably, Chinese companies are diversifying production into Southeast Asia, while foreign direct investment (FDI) across the ASEAN region has seen an uptick. India has emerged as a key beneficiary, often viewed as a structural alternative to China. "This is not diplomatic hedging. It is deliberate diversification,” said Vijay Eswaran, Executive Chairman of QI Group.

With ASEAN recording a 4.6% growth rate in 2024, far ahead of the US and EU, the region is positioning itself as a resilient hub in a time of uncertainty.

More Finance News to Watch

• Copper Prices Soar: On July 8, US copper prices surged 13% to a record high following the announcement of a 50% tariff on imports. The next day saw a dip on the London Metal Exchange, but analysts are cautious as demand may weaken with buyers holding back. The US imports around 60% of its copper, used extensively in construction and electronics.
  
  

• Pharma Sector Holds Steady: Despite a dramatic warning of a 200% tariff on pharmaceuticals, market reactions were moderate. European drug stocks recovered after an initial dip, while US pharma stocks gained 0.7%. India’s pharma sector, heavily involved in supplying generics to the US, remained largely unaffected.
  
  

• Bank Revenues on the Rise: Global banks are forecasted to report a 10% increase in market revenues for Q2, fueled by heightened trading activity amidst tariff policy shifts. This follows a 15% rise in Q1, according to Crisil Coalition Greenwich.
  
  

• BoE and ECB Raise Flags: The Bank of England’s latest financial stability report cautions that higher tariffs could increase the risk of corporate defaults and strain banks. The European Central Bank also emphasized that security threats, foreign investment restrictions, and tariffs must be factored into risk management.
  
  

• China Monitors Dollar Trends: Ahead of the looming tariff deadlines, China’s central bank has initiated surveys among financial institutions to assess the weakening of the US dollar and its impact on the yuan.
  
  

• Japan’s Consumer Strength: Japanese household spending jumped 4.7% YoY in May, driven by car purchases and dining, though analysts warn that US tariff uncertainty may curb recovery momentum.
  
  

• SEBI Cracks Down on Manipulation: India’s Securities and Exchange Board has barred a US firm for allegedly manipulating the Bank Nifty index through coordinated trades in banking stocks and derivatives.
  
  

• Shadow Banking Under Scrutiny: The Financial Stability Board has urged global regulators to cap leverage and scale down non-bank financial entities. With $218 trillion in assets held by hedge funds, private credit firms, and insurers, the sector’s opacity poses systemic risks.
  
  

• Climate Risk Divides Regulators: As global leaders prepare for the G20, a revised FSB report has highlighted internal divisions on addressing climate-related financial risks.
  
  

Forum Stories: Fintech, Tariffs & Young Investors

• Fintech’s New Chapter: The World Economic Forum’s Future of Global Fintech report shows the sector entering a sustainable growth phase post-pandemic. Fintech remains vital in expanding access to finance for underserved groups, especially amid tightening regulations and evolving AI trends.
  
  

• Financial Fragmentation Rising: Experts from Oliver Wyman suggest that escalating tariffs are splitting the global financial system. With global growth forecast at 2.3%, institutions must diversify partnerships and maintain clear communications to navigate geopolitical and regulatory risks.
  
  

• Young Investors Driving Change: The Global Retail Investor Outlook 2024 from the World Economic Forum, Robinhood, and BCG finds that Gen Z and millennials are transforming investing. Nearly 45% started investing earlier than older generations, favoring AI-driven platforms and hybrid advisory models.
  
  

• BNPL Meets Credit Scoring: In a major shift, US credit agency FICO will now include Buy Now Pay Later (BNPL) data in credit scores. This could significantly alter how short-term digital borrowing affects long-term financial health.
  
  

Conclusion

The latest US tariff announcements, while headline-grabbing, have yet to spark major panic in global markets. However, the broader financial ecosystem from global banks to small ASEAN economies is recalibrating for a world where trade friction, geopolitical tension, and systemic risk are increasingly the norm. As financial strategies evolve, investors and institutions alike must stay informed and agile in an unpredictable global economy.