HFMarkets (hfm.com): New market analysis services.

[HFM]

Date: 11th June 2025.


Dow Fails to Break Resistance Ahead of Key Bond Auction and CPI!



Trading Leveraged products is Risky


The Dow Jones rose to its highest price since March 2025 as the US and China agreed on a framework to lower tariffs. The comments from both the US and Chinese negotiators kept to an optimistic tone, reassuring markets of a deal. However, a key factor for today will be the US inflation rate and two US Bond auctions. The Treasury will sell $39B in 10-year notes Wednesday and $22B in 30-year bonds Thursday.


Dow Jones Rises on US-China Optimism


The Dow Jones on Tuesday rose 0.20% from market open to market close. However, the impulse wave after a decline early in the day measured 0.70%. The Dow Jones continues to honour the current trend lines which act as a support level. The bullish price movement is being given by the US-China trade negotiations in London and the optimistic tone.


So far we know the agreement will mean China will ease export restrictions on rare earth materials essential for electronics and green tech. In exchange, the US will relax some export controls on high-tech items like semiconductors and jet-engine parts. As a result, the NASDAQ, SNP500 and Dow Jones rose in value.


However, even with the latest upward price movement, the index continues to find resistance at the $42,959.00 level and fell 0.20% on Wednesday 11th.


Dow Jones Price Action and Technical Analysis


The main concern for technical analysts is that the Dow Jones on the daily chart is witnessing divergence. This means the price has risen to a higher high, but the RSI remains at a lower low. Simultaneously, as mentioned above the price finds resistance at the $42,959.00 level and has failed to break above this level on 4 occasions.



USA30 1-Hour Chart


Therefore investors remain on edge and prepared for an alternative price movement regardless of the price remaining above most Moving Averages and trend lines. Currently, some risk indicators point to a slight risk-off sentiment, however, no major red flags. The Put/Call ratio has fallen which is positive for the Dow Jones, and the VIX has risen which is negative. The High Low Index also points to a positive investor sentiment as 5 stocks remain at 52 week highs while zero are at a 52 week low.


Due to not obtaining a clear one-sided signal, investors will await for the Bond Auction and Inflation Rate to determine the future price movement.


Today’s Bond Auction and Inflation Rate Impact On The Dow Jones


The Treasury will sell $39 billion in 10-year Bonds Wednesday and $22 billion in 30-year bonds Thursday. Traditionally, investors do not class bond auctions as an event which can trigger high volatility. However, given the increasing debt scenario, investors will pay particular attention. If the bond values are lower than previous auctions and expectations, investors may become spooked triggering a lower risk appetite. A poorly received auction (low demand, high yields) can have a negative effect on both the Dow Jones and the US Dollar. However, it can have a positive impact on Gold prices, the Japanese Yen and the Swiss Franc.



US Budget Deficit


Economists expect the US CPI (inflation rate) to rise from 2.3% to 2.5%. Over the past 3-months, the inflation rate has consecutively fallen below expectations. If the inflation rate again falls below expectations, the Dow Jones may find enough support to retest the current resistance level. Whereas, if the inflation rate rises to 2.5% or above, the Dow Jones can witness a potential quick selloff.


Key Takeaway Points:


* Optimism from the trade deal boosted the Dow, with China easing rare earth export restrictions in exchange for US tech export relaxations.
* The Dow struggles at the $42,959 resistance level, with technical divergence signalling potential price shifts.
* Positive sentiment is seen with 5 Dow stocks at 52-week highs, but mixed risk indicators suggest caution.
* Bond auctions and inflation data will influence future market movement, with higher inflation possibly triggering a selloff.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!


Click HERE to READ more Market news.


Michalis Efthymiou
HFMarkets


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 3rd July 2025.


Markets Soar as Vietnam Tariff Deal Eases Trade Tensions Ahead of Key Jobs Report.



Trading Leveraged products is Risky


Global financial markets moved higher this week, with Wall Street hitting fresh record highs after President Donald Trump announced a last-minute trade agreement with Vietnam, easing concerns about aggressive tariff hikes. The deal, finalised just days ahead of a July 9 deadline, marks the third such trade accord under the administration’s push for ‘reciprocal tariffs’ and offers a temporary sigh of relief to investors navigating an increasingly volatile global outlook.


But while the headline deal offered a near-term boost to equities, underlying tensions around fiscal policy, global debt burdens, and upcoming US jobs data kept markets on edge.


Vietnam Trade Agreement Lifts Sentiment, but Tariffs Still High


Trump’s announcement confirmed that Vietnamese exports to the US will be subject to a 20% tariff, significantly lower than the threatened 46%, but still more than double historical rates. In return, Vietnam will drop tariffs on US goods.


The agreement arrives amid growing pressure on America’s trading partners to meet Washington’s demands. Dozens of economies, including Japan and the EU, are still racing to finalise similar deals before steep tariff increases take effect on July 9. Trump has already warned Japan that if negotiations fail, tariffs could spike to 30–35%, well above the temporary 10% rate introduced earlier this year.


The broader message: the risk of global tariff escalation remains very real.


Wall Street Breaks Records as Investors Bet on Policy Clarity


US equities cheered the trade progress. The S&P 500 climbed 0.47%, the Nasdaq surged 0.94%, and both closed at new all-time highs. The Dow Jones edged slightly lower by 0.02%. Investors were also buoyed by renewed optimism around Trump’s proposed tax and spending package, which aims to make tax cuts permanent and scale back regulations.


Yet, beneath the surface, uncertainty lingers. Treasury yields climbed as the Senate passed the OBBB bill, stoking fears about deficit spending. The 10-year Treasury yield rose to 4.277%, while the 2-year rate edged up to 3.785%. Bond markets remain sensitive to the growing national debt and the prospect of further supply.


Tax Bill Faces Hurdles, Fuels Fiscal Concerns


Trump’s ambitious tax and spending bill, valued at $3.3 trillion, is facing resistance in the House. While it proposes making earlier tax cuts permanent and includes deregulation efforts, critics warn it would significantly expand the national debt and cut social safety net programs.


These concerns spilt into the bond market, with even Japanese government yields rising, despite a strong 30-year auction. Globally, investors are re-evaluating the balance between stimulus and sustainability.


Dollar Pulls Back, Commodities Gain


Currency markets reflected a mixed mood. The US dollar index (DXY) initially rallied to 97.152 but closed the day lower at 96.787, giving support to commodities. The British pound held firm at $1.3628 after nearly 1% losses the previous day. Political stability returned after UK PM Keir Starmer publicly backed Finance Minister Rachel Reeves, whose emotional parliamentary appearance followed controversy over welfare policy U-turns.


The euro slipped to $1.1788, still near its recent high, while the yen weakened slightly to 143.84 per dollar.


Gold prices firmed, and oil advanced sharply, with Brent crude nearing $69 and WTI above $67, following the Vietnam deal and ahead of this weekend’s OPEC+ meeting, where producers are expected to boost output quotas.


Meanwhile, copper surged to a 3-month high, nearing $10,000 per ton on the London Metal Exchange, as traders scrambled to ship supplies to the US in anticipation of tariffs. LME inventories have fallen to their lowest since 2023, and the rush has pushed the market into what analysts call ‘an emotional frenzy.’ The LME recently stepped in with new rules to manage speculative positions.





Asia Mixed as Tariff Risks and US Data Loom


Asian stock markets were mixed on Thursday. Vietnam’s index rose 0.5% to a 2-year high, while the Vietnamese dong hit a record low of 26,229 per dollar. Japan’s Nikkei fell 0.1%, and Hong Kong’s Hang Seng dropped 1%, though China’s blue chips gained 0.5%.


Investors remain cautious. AMP’s chief economist, Shane Oliver, warned that the Vietnam deal could set a precedent for similarly aggressive trade measures against Europe and Japan.


South Korea’s President Lee Jae Myung also struck a pessimistic tone, saying US negotiations were ‘difficult’ and that a deal may not be reached in time.


All Eyes on US Nonfarm Payrolls


With the July 4 holiday approaching, markets are now laser-focused on Friday’s nonfarm payrolls report. While the consensus points to a 130,000-job increase, recent weakness in the ADP private payrolls, which showed a 33,000-job drop, suggests downside risks. The services sector bore the brunt of the losses, especially in professional, educational, and health services, while leisure and manufacturing saw modest gains.


Bloomberg’s whisper number has already dropped to 98,000, indicating that expectations are being recalibrated. The data could prove decisive in shaping the Federal Reserve’s next move on interest rates.


Conclusion: A Calm Before the Storm?


While markets welcomed the easing of trade tensions with Vietnam, the bigger picture remains uncertain. The threat of broader tariff hikes, unresolved fiscal debates in Congress, and a pivotal US jobs report all loom large. Investors are watching closely, not just for short-term reactions but for clues about the direction of monetary policy, global trade, and commodity demand in the second half of 2025.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!


Click HERE to READ more Market news.


Andria Pichidi
HFMarkets


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 18th July 2025.


Wall Street Hits New Highs Amid Strong Data, Optimism Over Fed Stability, and Tech Earnings Boom.



Trading Leveraged products is Risky


Wall Street continued its record-breaking rally as stronger-than-expected US retail sales and jobless claims data reinforced confidence in the resilience of the US economy. Investor sentiment was further boosted by solid corporate earnings and easing fears over potential leadership changes at the Federal Reserve.


The Nasdaq surged 0.74% to close at a new all-time high of 20,884, driven by gains in major tech stocks, while the S&P 500 climbed 0.54% to reach a record 6,297. The Dow Jones Industrial Average also advanced 0.52%, contributing to a broadly positive session across US equities.


FOMO Drives Rally; Tech, Crypto, and Earnings in Focus


Momentum was further fueled by FOMO (fear of missing out) as investors piled into the rally. Nvidia and Lucid led gains in the tech sector, with Lucid jumping 36% on bullish sentiment. Taiwan Semiconductor (TSMC) reported record-breaking profits, adding to the enthusiasm.


PepsiCo shares also surged following better-than-expected revenue and earnings figures, while United Airlines rose 3.1%. After the bell, Netflix reported robust quarterly results, likely setting the tone for the next trading session.


Cryptocurrencies also moved higher after the US Congress passed the stablecoin regulation bill, injecting fresh optimism into the digital asset space.





Bond Market Stabilises Amid Fed Leadership Clarity


Treasury yields initially declined as concerns over a potential dismissal of Fed Chair Jerome Powell subsided, although the broader risk-on environment eventually erased some of the early gains in bonds.


Japan’s Markets on Edge Ahead of Key Upper House Election


Investors are closely watching Japan’s upcoming upper house election, which could have far-reaching implications for financial markets, government policy, and the direction of fiscal stimulus. The coalition led by Prime Minister Shigeru Ishiba is facing mounting pressure, with opinion polls indicating a possible defeat.


Japanese Government Bonds Tumble; Yen Weakens Sharply


Japanese government bonds (JGBs) experienced a sharp sell-off, sending 30-year yields soaring to a historic high of 3.20%, while the yen dropped to multi-month lows against the US dollar and euro. This market turbulence reflects growing concern that a new government may accelerate fiscal spending through increased JGB issuance.


Three Key Election Scenarios for Markets:


1. LDP Retains Majority – Bullish for Bonds and Yen
A victory for Ishiba’s Liberal Democratic Party (LDP) coalition could stabilise the bond market and support the yen. Analysts believe that such an outcome would reduce expectations for aggressive fiscal spending.
1. LDP Loses Majority – Policy Shift and Leadership Change?
If the ruling coalition fails to secure 50 seats, Ishiba could be replaced. One potential successor, Sanae Takaichi, supports renewed monetary easing, an outcome that could spark volatility in both the yen and Japanese equities.
1. Opposition Surge – Market Disruption Likely
A strong performance by populist and reformist parties such as Sanseito could upend markets. Proposals to cut or eliminate Japan’s consumption tax may result in sharply higher long-term yields and further sell-offs in JGBs.


Crude Oil Extends Gains as US Resilience and Tight Supply Lift Sentiment


Oil prices rallied for a second straight session amid signs that the US economy remains resilient despite ongoing trade tensions. Brent crude approached the $70 mark, while West Texas Intermediate (WTI) hovered near $68.


Backwardation in the oil futures market, where near-term prices are higher than future contracts, suggests tight supply conditions. This comes even as OPEC+ continues to unwind production cuts.





Japan Slides into Trade Deficit as US Tariffs Bite


Japan posted a trade deficit of 2.2 trillion yen (€13 billion) in the first half of the year, driven by a decline in exports amid ongoing US tariff pressure. June exports fell 0.5% year-over-year, following a 1.7% drop in May. Shipments to the US were particularly hit, declining 11%, with auto exports plunging 26.7%, following a 25% tariff introduced in April.


With nearly 20% of Japan’s exports heading to the US, the country is pushing for favourable trade agreements. Meanwhile, Japan prepares for Upper House elections this Sunday. Weak public support for Prime Minister Shigeru Ishiba could jeopardise the ruling party’s majority unless a new coalition is formed.


Recession Fears Mount in Japan


Japan’s economy contracted in Q1 and may be headed for another contraction in Q2. Falling exports and weakening global demand are raising fears that the country may officially enter a recession in the coming months.


Oil Prices Rebound Amid Supply Risks and Diesel Shortages


After three consecutive days of losses, oil prices edged higher. Traders are weighing lower-than-usual crude and diesel inventories in the US and Europe against broader concerns about future supply gluts. Diesel shortages in particular have supported prices in the short term.


‘The market is currently buoyed by tight diesel supplies, but if OPEC+ production ramps up, we may see a bearish shift,’ said Zhou Mi, an analyst at Chaos Ternary Futures Co.


US distillate stockpiles remain at their lowest seasonal level since 1996, despite a modest weekly increase. The futures spread between low-sulfur gasoil and Brent for September—a key indicator of diesel refining profitability—has jumped 7% this month.


Geopolitical Risks in Kurdistan Add to Supply Concerns


Drone strikes targeted several oil fields in Iraq’s semi-autonomous Kurdistan region on Wednesday. While the region has not exported crude since a pipeline closure over two years ago, the attacks highlight growing risks to global energy infrastructure.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!


Click HERE to READ more Market news.


Andria Pichidi
HFMarkets


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 5th August 2025.


Markets Rebound as Earnings Roll In, Dollar Stabilises Amid Rate Cut Bets and Tariff Concerns.



Trading Leveraged products is Risky


US stock futures edged higher on Tuesday, signalling a more stable open on Wall Street following last week’s turbulence and ahead of a crucial wave of corporate earnings. Futures tied to the Dow Jones Industrial Average and S&P 500 rose 0.2%, while Nasdaq 100 futures climbed 0.3%.


The recovery momentum continued from Monday, when stocks bounced back sharply after a volatile Friday. The rally came despite lingering concerns over a weak US jobs report, fresh tariff threats from the White House, signs of persistent inflation, and the surprise dismissal of the head of the Bureau of Labour Statistics. Adding to the uncertainty, President Trump warned of potential tariff hikes on India, further unsettling global trade dynamics.


Investors now turn their attention to a heavy earnings calendar, with AMD and Rivian reporting Tuesday, followed by McDonald's, Disney, Uber, Snap, Palantir, and others later this week. Palantir shares surged in after-hours trading after the company topped earnings expectations and reported over $1 billion in quarterly revenue for the first time.


Despite the uncertainty, second-quarter earnings have largely surprised to the upside. According to FactSet, with 66% of S&P 500 companies having reported, average earnings per share are now expected to rise 10.3%, more than double the initial 5% forecast. Companies benefited from lowered expectations amid concerns about tariffs, high valuations, and economic headwinds.


Several notable companies contributed to the rebound. Idexx Laboratories spiked 27.5% on better-than-expected results, while Tyson Foods rose 2.4% after beating profit forecasts. Wayfair gained 12.7% on accelerating growth, and Tesla added 2.2% following the approval of a massive restricted stock award to CEO Elon Musk, calming fears he might exit the company. On the downside, Berkshire Hathaway fell nearly 3% after reporting lower profits tied in part to a loss in its Kraft Heinz investment.


Asian Markets Track US Gains; Oil and Commodities Stable


Asian equities joined the global rally, with Japan’s Nikkei 225 up 0.6%, South Korea’s Kospi gaining 1.4%, and Shanghai’s Composite Index rising 0.5%. The Hang Seng added 0.3%, while Australia’s ASX 200 and Thailand’s SET both climbed 1.1%. India’s Sensex, however, dropped 0.5% as tensions with the US over Russian oil imports escalated.


Dollar Finds Stability as Fed Cut Expectations Climb


Meanwhile, the US dollar found its footing, rising 0.2% after last week’s sharp selloff triggered by soft jobs data and political upheaval. Traders are now weighing whether the increased likelihood of Federal Reserve rate cuts could help support risk appetite and offset the drag from new tariffs.


According to the CME FedWatch Tool, markets now see a 92.1% chance the Fed will cut rates at its September meeting, up from 63% a week ago. Goldman Sachs expects three straight 25-basis-point cuts starting next month, and sees a 50-basis-point move as possible if unemployment rises further. San Francisco Fed President Mary Daly echoed the growing urgency, stating, ‘I was willing to wait another cycle, but I can't wait forever.’


Despite July marking the dollar’s first monthly gain this year, analysts remain cautious. Citi economists noted that USD/Asia is sitting in a ‘fragile equilibrium’ amid uncertainty about US economic resilience. Conversations with clients, they said, reveal many are questioning whether the narrative of US exceptionalism still holds true.


The dollar index hovered around 98.816, recovering from a one-week low. The euro traded at $1.1559, down 0.12%, while sterling stood at $1.328. The yen was flat at 147.10 after the Bank of Japan signalled a potential return to rate hikes if global trade tensions ease. The Swiss franc extended losses, down 0.2% to 0.8092, as Switzerland seeks to negotiate a deal to avoid a 39% US tariff that could severely hit its export-heavy economy.


A quick adjustment in supply chains is widely expected, but it might take 6 to 12 months to know who wins and who loses. Also, the ongoing weakness for the greenback could continue.


Other currencies saw minor moves:


* The Australian dollar eased 0.1% to $0.6466
* The New Zealand dollar slipped 0.1% to $0.5893


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!


Click HERE to READ more Market news.


Andria Pichidi
HFMarkets


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 22nd August 2025.


The Fed’s Cut For September is Dimming, Pressuring Stocks!



Trading Leveraged products is Risky


US stocks continue to decline as the possibility of the Federal Reserve adjusting rates in September is becoming less likely. Inflation continues to be a concern for the FOMC, while the latest economic data indicates growth for the US economy. The US Purchasing Managers’ Index is the latest economic data made public, but the US significantly beat projections. The market now turns its attention to the Jackson Hole Symposium and the Fed Chairman’s speech at 14:00 GMT.


Global Economy Obtains Boost From Latest Data


The Purchasing Managers’ Index from around the globe was generally positive, with most countries beating previous expectations. However, the US PMI data was surprisingly significantly higher than economists were expecting.


Services PMI Data - 55.4 Vs 54.2 Projections


Manufacturing PMI Data - 53.3 vs 49.7 Projections (highest in 2 years)


Positive economic data is usually observed to create a bullish trend within the stock market. However, under the current market conditions, where investors are looking for certainty over the Federal Reserve’s next move, the positive data is fueling the downward momentum. Currently, the economic data and comments from members of the Federal Open Market Committee are raising doubts over a September rate cut.


The Fed Bank of Chicago President, Austan Goolsbee, is the latest member to speak at the Jackson Hole Symposium. He told journalists that inflation is lower than expected, but there is data which is a concern for the regulator. ‘The last inflation report that came in, where you saw services inflation, which is probably not driven by the tariffs, ’ significantly increased, as has producer inflation. However, most members of the FOMC are also concerned about the employment sector, which is cooling down and why investors are keen for interest rates to start falling.


The possibility of an interest rate cut in September has now fallen from 85.5% to 73.0% which means a cut is still a likely outcome. The market is likely to obtain further clarity on the matter as the Federal Reserve Chairman is due to speak at 14:00 GMT. The NASDAQ and SNP500 are likely to experience high volatility during this time.


NASDAQ Performance and Technical Analysis


The NASDAQ has not risen in value since August 12th and is currently trading 3.70% lower than its recent high. Currently, all global indices are trading lower, the VIX index edges higher, and the put/call order ratio rises to the 0.70 mark. These factors currently provide a bearish bias for the NASDAQ and point to further downward price movement.


The price will depend on the Fed speech this afternoon and NVIDIA’s quarterly earnings report on the 27th. The report has a consensus Earnings Per Share forecast of $0.94 (Zacks, 14 analysts), up from $0.60 a year ago. If higher than expectations, the price of the most influential stock for the NASDAQ potentially may see significant gains in the upcoming weeks.



NASDAQ 30-Minute Chart


The price of the NASDAQ continues to remain below the 75-bar EMA, below the day’s VWAP and the 50.00 level on the RSI. This points to a continued bearish trend for the upcoming sessions, as do the bearish crossovers on the smaller timeframes. Based on signals from price action momentum, if the price remains below 23,104.42, sell signals are likely to remain intact.


Key Takeaway Points:


* Strong US PMI data has reduced expectations of a September rate cut, with odds falling from 85.5% to 73%. The uncertainty continues to pressure stocks.
* While inflation is easing, services and producer prices remain elevated, adding pressure on the Fed.
* Investors await Fed Chair Powell’s speech at 14:00 GMT, which could drive volatility in the NASDAQ and S&P 500.
* The NASDAQ is 3.7% off recent highs, trading below key technical levels, with sentiment bearish unless NVIDIA’s upcoming earnings surprise to the upside.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!


Click HERE to READ more Market news.


Michalis Efthymiou
HFMarkets


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 5th September 2025.


Global Markets Rally Ahead of Key US Jobs Data as Fed Rate Cut Bets Strengthen.



Trading Leveraged products is Risky


Global markets ended the week on a strong note, buoyed by mounting expectations that the Federal Reserve could soon lower interest rates following a series of disappointing US labour market indicators. Wall Street reached fresh record highs, Treasury yields slid to multi-month lows, and Asian equities continued to track higher on Friday as investors awaited the official August Nonfarm Payrolls report, due later in the day.


US Labour Market Signals Weakness


A run of employment data this week highlighted signs of cooling in the US labour market.


* ADP payrolls showed private-sector job creation slowed to just 54,000 in August, far below expectations.
* Initial jobless claims rose by 8,000 to 237,000, the highest since June.
* The Challenger, Grey & Christmas report indicated that announced layoffs jumped to 85,979 in August, up 39% from July and the largest monthly total since 2020.
* The employment component of the ISM services survey remained in contraction territory, pointing to a softer demand for labour in key service industries.


While these reports signalled fragility, they also offered relief for bond investors. Second-quarter productivity strengthened, and unit labour costs rose modestly, reinforcing expectations that inflationary pressures may be contained. That combination fueled demand for Treasuries, sending yields down sharply. The 10-year Treasury yield dropped to 4.16% from 4.22%, its lowest in months.


Wall Street Climbs on Easing Yields


US equities rallied as falling yields reduced pressure on valuations. On Thursday:


* The S&P 500 climbed 0.8%, hitting a fresh all-time high.
* The Dow Jones Industrial Average added 350 points (0.8%).


* The Nasdaq Composite advanced 1%, supported by gains in growth stocks.
Investors increasingly view labour market softness as a catalyst for the Fed to cut rates. A 25-basis-point cut at the September 17 FOMC meeting is now nearly fully priced in by futures markets. Analysts argue that unless job growth or wages surprise significantly to the upside in Friday’s official NFP report, the Fed is set to ease policy for the first time this year.





Asia Follows Wall Street Higher


Asian equities joined the global rally on Friday. In Japan, the Nikkei 225 gained 0.9% to 42,945.16, supported by strong domestic data. Labour cash earnings rose 4.1% y/y in July, accelerating from 3.1% in June, while household spending climbed 1.4% y/y, marking a third consecutive month of growth.


Japan also welcomed positive trade developments. US President Donald Trump signed an executive order on Thursday implementing a trade agreement with Japan that had been finalised in July, reducing tariffs on auto imports from 25% to 15%. Prime Minister Shigeru Ishiba praised the move as a step toward easing uncertainty for critical industries, particularly automobiles. The yen edged up 0.2% to 148.36 per dollar.


In China, the Hang Seng Index rose 0.5% to 25,194.85, while the Shanghai Composite gained 0.4% to 3,778.95. Still, concerns remain that export growth slowed in August due to fading effects from Beijing’s earlier tariff truce with Washington and a high base of comparison from 2023.


European Data: Weak German Orders, Stronger UK Sales


European data painted a mixed picture. German factory orders slumped 2.9% m/m in July, a much weaker reading than expected, though June’s figure was revised slightly higher. Excluding large-ticket items, orders rose 0.7% m/m, but the overall trend underlined vulnerability in Europe’s largest economy. Export orders dropped 3.1%, while domestic demand fell 2.5%, reflecting the lingering impact of US tariffs and global trade uncertainty. A bright spot was the auto sector, where orders jumped 6.5%.


In the UK, retail sales outperformed expectations, climbing 0.8% m/m in July. However, June’s growth was revised down to 0.3% from 0.9%. On an annual basis, sales rose 1.1% y/y, offering some relief for a consumer sector that has struggled under high inflation and tighter monetary policy.


Crypto and Commodities Stay Cautious


Cryptocurrencies traded sideways ahead of the jobs report. Bitcoin hovered near $111,100, little changed on a 24-hour basis. Analysts said Bitcoin continues to move in tandem with equities, with macroeconomic data shaping investor expectations for liquidity conditions.


Goldman Sachs forecasts August NFP will show an increase of 60,000 jobs, below consensus estimates of 75,000, with unemployment ticking up to 4.3%, its highest since 2021. Such a reading would reinforce the case for a Fed cut and potentially support risk assets, including Bitcoin.


Shawn Young, chief analyst at MEXC Research, told Decrypt that markets have “largely priced in” weak labour data, but a “Goldilocks” report with moderate job gains, stable unemployment, and contained wage growth could fuel risk-on sentiment across equities and crypto. By contrast, a sharp downside miss might spark initial risk-off moves before markets pivot back to rate-cut optimism, while a strong upside surprise would push yields and the dollar higher, hurting risk assets.





Outlook: Fed Faces Delicate Balancing Act


The Fed is under pressure to balance its dual mandate of maximum employment and price stability. With core inflation still running at 3.1%, the central bank must weigh the risks of cutting rates too quickly against the need to stabilise a weakening job market.


Friday’s official Nonfarm Payrolls report from the US Labour Department will be pivotal in shaping the Fed’s policy trajectory. Markets are bracing for volatility, with traders watching whether the data confirms the narrative of a gradual cooling in the labor market—or delivers an unexpected twist that shifts expectations for the pace and depth of Fed easing.


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Please note that times displayed based on local time zone and are from time of writing this report.


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Andria Pichidi
HFMarkets


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