US futures jump as Trump delays EU tariff deadline

European stock indices were generally firmer in early trade following the long weekend. The rebound comes after last Friday’s heavy selling, which was triggered by President Trump’s unexpected EU tariff announcement, along with heightened geopolitical risk. 

The German DAX posted a fresh intra-day high in early trade (see chart below):

Source: TN Trader

Though the US has since postponed the EU tariff deadline to July 9th, Friday’s sell-off left its mark, and sentiment remains cautious. Investors appear to be weighing the relief from the delay against the possibility of renewed pressure should talks falter.

Though the US has since postponed the EU tariff deadline to July 9th, Friday’s sell-off left its mark, and sentiment remains cautious. Investors appear to be weighing the relief from the delay against the possibility of renewed pressure should talks falter.

Oil markets traded sideways, with prices little-changed this morning as traders held back from making any strong directional moves. With important OPEC+ meetings coming up this Sunday, investors are looking forward to additional clarity concerning further moves to increase output. 

For now, price action remains confined within a relatively tight range, reflecting the market’s hesitation ahead of the supply decision.

Gold fell sharply overnight and dropped below $3,300 in early European trade. It has now given back most of its gains from Friday, when it rallied sharply on news that President Trump was hitting the EU with a fresh 50% tariff. Gold’s pullback comes as the Trump administration postpones those tariffs for five weeks.

Source: TN Trader

Further downside pressure is coming from a recovery in the US dollar. The Dollar Index has dropped steadily over the past fortnight, but it found a bid this morning, making gains across the board in early trade. 

Despite this, overall dollar weakness along with market uncertainty has kept gold on traders’ radars as a preferred defensive asset.

Currency markets began the week on a muted note, with the US dollar making gains across the board. Despite this, the Dollar Index continues to trade well below the key 100.00 level, reflecting continued downside pressure amid trade policy concerns and fiscal uncertainty. The dollar’s weakness since mid-January has supported commodities like gold. 

Meanwhile, the Japanese yen continues to draw attention. The yen rallied sharply over the first four months of this year as the dollar declined. The USD/JPY broke below 140.00 in April, hitting its lowest level since last September. 

The dollar then began to bounce, as analysts rowed back on US rate cut expectations, while the Bank of Japan became less hawkish than earlier in the year. 

Now, the yen appears to be rallying once again, although it spiked lower overnight as Japanese policymakers ponder action to push yields down.

Source: TN Trader

The VIX opened the week little changed. But it was still hovering at levels that suggest markets remain alert to risk. While not flashing extreme fear, the index reflects ongoing caution tied to unresolved macro themes — particularly trade tensions and potential policy surprises.

Trade concerns remain front and centre. The extension of the EU tariff deadline to July 9th only delays - rather than resolves - market anxiety. With NVIDIA earnings tomorrow, US Core PCE on Friday and the OPEC+ meeting still ahead, headline sensitivity remains high.

On the horizon, talk of higher rates from the Bank of Japan adds further complexity to an already delicate global landscape. With so many moving parts, caution will likely remain the dominant theme in the days ahead.