Key Takeaways
- The US and China are poised to extend their trade truce by another 90 days, aiming to prevent a return to higher tariffs that could disrupt global supply chains.
- US continuing jobless claims have climbed to their highest level since November 2021, indicating a potential softening in the labor market as more Americans struggle to find new employment.
- Novo Nordisk (NVO) announced plans to launch its own obesity pill next year, intensifying competition in the rapidly growing GLP-1 drug market.
- Donald Trump is expected to sign an executive order today concerning 401(k) retirement plans, which would allow the inclusion of private assets and potentially cryptocurrency, marking a significant shift for retirement savings.
- Spot gold saw a slight increase of 0.5% to $3,385.19 per ounce following recent US economic data, with market sentiment influenced by expectations of Federal Reserve rate cuts.
US-China Trade Deadline Extension Anticipated
The US and China are widely expected to extend their trade truce by an additional 90 days, pushing back the current August 12 deadline. US Commerce Secretary Howard Lutnick has indicated that an extension is likely, providing more time for ongoing negotiations. This move aims to avert the re-imposition of significantly higher tariffs that could impact global supply chains. Treasury Secretary Scott Bessent also hinted at the likelihood of an extension following recent constructive talks in Stockholm.
Rising Jobless Claims Signal Labor Market Slowdown
Continuing jobless claims in the United States have reached their highest level since November 2021, a concerning indicator for the labor market. Reports show that recurring applications for unemployment benefits advanced to 1.96 million in the week ended May 31, and remained near 1.946 million as of July 19. This upward trend suggests that unemployed Americans are taking longer to secure new jobs, coinciding with a broader slowdown in hiring.
Novo Nordisk to Launch New Obesity Pill
Novo Nordisk (NVO) is set to launch its own obesity pill next year, according to Chief Scientific Officer Martin Holst Lange. This development comes as the pharmaceutical giant, already a leader in the GLP-1 drug market with popular medications like Ozempic and Wegovy, faces increasing competition. The company recently revised down its sales forecasts for 2025 due to the prevalence of knockoff versions of its obesity drugs and competition from rivals like Eli Lilly.
Trump's 401(k) Order and Tech Sector Engagements
Donald Trump plans to sign an executive order today concerning 401(k) retirement plans, which would permit the inclusion of private assets and potentially cryptocurrency. This policy shift aims to provide everyday investors with access to alternative investments such as private equity, real estate, and venture capital, traditionally reserved for accredited investors. Proponents suggest this could offer greater diversification and potentially higher returns, while critics raise concerns about illiquidity, complexity, and higher fees.
Separately, Trump has recently engaged with major tech leaders, including Apple (AAPL) CEO Tim Cook. During these discussions, Trump announced a steep 100% tariff on imported computer chips and semiconductors, with an exemption for companies that build within the United States. Following this announcement, Apple pledged a new $100 billion investment to boost US manufacturing, and Nvidia (NVDA) was also noted for its significant US investments.
Gold Prices React to Economic Data
Spot gold experienced a slight rise of 0.5%, reaching $3,385.19 per ounce, following the release of recent US economic data. The precious metal has found support from market expectations of potential interest rate cuts by the Federal Reserve, which tend to reduce the opportunity cost of holding non-yielding assets like gold.
Bank of England Prioritizes Price Stability
Bank of England Governor Andrew Bailey emphasized that price stability is a key consideration when determining the minimum wage. The Bank recently cut its key interest rate to 4%, the lowest in over two years, amidst efforts to bring inflation back to its 2% target. Bailey noted that while disinflation is generally continuing, inflationary pressures from energy and food prices remain a factor.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.