Trump's EU Tariff Will Be Delayed Until July 9th and Futures are Responding Positively

Last Friday was a very defensive day in the markets. Trump mentioned a 50% tariff on the EU as well as a major tax hike for iPhones and other cellphone producers if they do not produce their phones in the United States. This news sent the major stock indicies for a big drop. Investors rushed out of the high beta growth stocks and flocked towards companies within the more defensive sectors.

Over the weekend, Trump and the President of the EU, Ursula von der Leyen, spoke with one another and came to an agreement to delay the tariffs until July 9th. This news caused S&P futures price to jump over a percent as soon as futures markets opened up.

This is very similar to April 10th when Trump mentioned a pause to his global tariffs. On this day, we saw the best day we have ever seen in the Dow Jones Index. And ever since that day, the market has not returned to those lows. Will the rebound we are seeing in the futures market hold into the trading week? Or is this just the beginning of more EU tariff uncertainty?

"European Commission President Ursula von der Leyen stated that the conversation with Trump was pleasant, and Europe is ready to advance negotiations quickly and decisively. The EU needs to reach a good agreement by July 9."

Since the April lows in the S&P 500, the market has experienced a very swift rebound and was well in overbought territory at the start of last week. So, the current correction is a normal occurrence so far. The drop on Friday morning was substantial and may have scared a lot of investors. But is it really time to load up on short positions just yet?

Ever since the major market correction that lasted from February to April of this year, many investors are calling for a bear market this year. This is understandable since the very steep sell-off looked like something you would only see before the start of a bear market or some sort of larger market crash.

The current rebound the market is experiencing could be a simple bear market rally. Or the market brushed off the uncertainty of a Trump tariff war, and we will see new all-time highs very soon. Last time Trump initiated a tariff war, once the tariff uncertainty in the market subsided, markets concluded the tariff war relatively flat. What do you think will happen in 2025?

As always, I am not a financial professional, and this is not investment advice. Be careful and be patient. Dont anticipate the market. Rather, participate in the market. Don't invest money that you can't afford to lose. Give some of your investments time and know when to cut your losses.

Don't be greedy. Don't invest in anything you don't understand. Don't put all of your eggs in one basket. Don't listen to the hype. Don't fomo or panic into or out of trades. Do your own due diligence. And just follow the trends. A trend is your friend. Good luck trading.