Market Musings 6/11/2025
Quick thoughts on the markets and major portfolio news. Not on Ursa yet? Download Ursa from the App Store!
Markets slide on disappointing US-China #Tariffs “agreement”…
Markets slide as China #Tariffs talks end without significant concessions on either side. After hinting they might need an extra day, the US and China delegations end up wrapping up London talks late Tuesday anyways.
So, what was agreed to?
The reduced #Tariffs will remain in place for the remainder of the 90-day pause. Meanwhile, the US will rollback some restrictions on technology and chemical exports as well as threats to ban Chinese student visas. In exchange, China will loosen rare earth metal exports in-line with the prior understanding.
So, uhh, what’s changed? Well, really nothing.
We basically just rewinded the clock back a few weeks to ago when the US and China initially met in May. While the White House is spinning it as a deal, it’s really just yet another promise to talk more.
So, what’s the takeaway?
First, it doesn’t appear we’re anywhere near an actual #Tariffs deal with China. There really wasn’t any progress on trade issues other than walking back the petty drama since the last meeting.
However, given both side were almost unable to even agree on this, there will likely be a long way before any meaningful trade agreement is made. They didn’t even schedule a time to talk next.
Even the ever-optimist markets were disappointed with the lack of details and no concrete next steps. The S&P 500 snapped the rally and fell on Wednesday.
The August 12th #Tariffs pause deadline isn’t that far away. However, we do see a White House getting increasely desperate for a deal and would expect that deadline to likely be extended. Despite the grandstanding, the US is the one initiating all the talks－practically begging to meet.
While the agreement should loosen China’s rare earth metal export a little, we wouldn’t be surprised if they continue to slow walk it. It’s pretty apparent it’s their ace up their sleeve and they’re not likely to give that up quickly.
Near-term, we see continued #Tariffs drama with more talks, but nothing really getting resolved. However, it likely keeps the massive #Tariffs on pause (potentially indefinitely) which may shield the US from more #Inflation.
Our primary concern is still #ConsumerConfidence and business sentiment. Ongoing trade uncertainty will continue to make spending, hiring and investment difficult…
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The statements, opinions and analyses presented here are provided as general information. This article is the opinion of the author. Anything within this article should NOT be considered an investment recommendation or advice. See Ursa’s full disclosures here.
Original Photo by Pixabay.