Key Takeaways
- US Pending Home Sales saw an unexpected decline of -0.8% in June, missing estimates and signaling a potential slowdown in the housing market.
- White House Senior Adviser Kevin Hassett indicated "still hope" for progress in trade negotiations with Canada and confirmed President Trump will be briefed on China trade today, suggesting potential near-term developments on key tariff fronts.
- Hassett also highlighted President Trump's frustration with India trade progress, suggesting a 25% tariff could address the situation, while expressing optimism for India to open its market.
- The Bank of Canada maintained its key interest rate at 2.75% as expected, but acknowledged a significant 25% drop in Canadian exports in Q2 and widened the output gap, indicating possible future rate cuts if economic weakness persists.
- JPMorgan Chase (JPM) has partnered with Coinbase to allow Chase credit card holders to fund crypto purchases, marking a significant shift in the bank's stance on digital assets.
Trade Developments Dominate Headlines
White House Senior Adviser Kevin Hassett offered insights into ongoing trade discussions, stating there is "still hope for progress" with Canada, indicating that negotiations remain fluid. On the China trade front, Hassett confirmed that President Trump is scheduled to receive a briefing today, a development that could precede significant policy announcements and potentially impact market sentiment.
Regarding India, Hassett conveyed President Trump's frustration with the lack of progress in trade relations. He suggested that a 25% tariff would be a measure to "address and remedy" the situation, while also expressing hope that India would open its market to the U.S. and reconsider business practices. Hassett emphasized that a trade deal with India could be an "absolute game changer for the global economy."
Italy's Economy Minister also weighed in on trade, stating the government has proposals for the U.S. regarding a web tax to prevent retaliation. The Minister noted that a potential EU-US deal on tariffs could negatively impact Italian GDP by up to 0.5% in 2026.
Economic Indicators and Central Bank Action
The latest U.S. economic data showed Pending Home Sales unexpectedly declined by -0.8% in June, falling short of the 0.2% estimate and reversing the previous month's 1.8% increase. Despite this, Hassett projected a robust 4% growth for the third quarter for the U.S. economy.
The Bank of Canada held its key interest rate steady at 2.75%, aligning with market expectations. However, the central bank reported a substantial 25% drop in Canadian exports and a 10% fall in imports during Q2. The Bank of Canada also noted that domestic demand grew just over 1%, and the output gap widened, indicating possible rate cuts if weak economic growth further reduces inflation. Governor Tiff Macklem stated that while tariffs in other agreements suggest the U.S. is not returning to free trade, the worldwide effects of U.S. trade policies have been less severe than anticipated so far.
Hassett reiterated the White House's 100% respect for Federal Reserve independence and noted that the Fed is "very data-dependent" and expected to "catch up soon."
Corporate and Market Updates
In corporate news, JPMorgan Chase (JPM) has announced a partnership with Coinbase, allowing Chase credit card holders to fund crypto purchases on Coinbase starting in fall 2025. This marks a significant shift for the bank, which was previously led by a vocal crypto critic.
Nvidia Corp. (NVDA) saw its target price raised by Morgan Stanley to $200.00 from $170.00. Meanwhile, Hycroft Mining (HYMC) announced a new drill campaign, targeting 14,500 meters of fresh drilling at its Nevada mine starting in early August, igniting bullish sentiment.
At market open, the S&P 500 was up 0.08% at 6,375.70, the Dow Jones rose 0.03% to 44,647.08, and the NASDAQ climbed 0.19% to 21,138.63.
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.