Global Equities Surge Toward Record Highs as US Markets Hit Resistance

Global stock markets are experiencing a surge of optimism, gradually approaching the record highs established in February, while US indices are encountering difficulties in breaching significant resistance levels.

The MSCI All-Country World Index is now just 0.4% shy of its peak on February 18, having climbed 19.2% since its low following President Trump's announcement of stringent tariff plans, most of which have been deferred to July.

While global equities enjoyed a broad rally yesterday, major US indices like the S&P 500 are faltering, unable to breach the psychologically significant 6,000 mark, signaling potential headwinds for investors.

US Manufacturing and Tariff Concerns Weigh on Markets

Recent data underscores challenges in the US economy. The US ISM Manufacturing PMI, released yesterday, indicated a third consecutive month of contraction in manufacturing activity, with supplier delivery times at their longest in three years, largely due to fears surrounding impending tariffs.

As the July deadline for tariff resolutions approaches, uncertainty continues to cast a shadow over market sentiment, potentially curbing the bullish momentum.

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Forex Market Dynamics Shift

In the foreign exchange market, the US dollar has emerged as the strongest major currency since the Tokyo open, bucking its recent weaker trend. Conversely, the Australian dollar has weakened, reflecting a shift away from risk-on sentiment.

This movement aligns with broader market caution as investors weigh tariff impacts and global economic indicators. Meanwhile, Swiss CPI data released today showed a modest 0.1% month-on-month inflation increase, in line with expectations, providing some stability for the Swiss franc.

Bitcoin Faces Resistance, Yen in Focus

Bitcoin, after hitting a record high of $112,000 two weeks ago, has encountered resistance below $107,000, with prices currently hovering around $105,500 based on recent market data.

This rejection suggests a bearish technical outlook in the near term, prompting traders to reassess their positions. In Japan, the Governor of the Bank of Japan's speech today could influence the yen, particularly if it addresses monetary policy or economic outlook, making it a key event for forex traders.

Did You Know?
The MSCI All-Country World Index tracks over 2,900 stocks across 47 countries, making it a key barometer of global market performance.

Key Economic Data Releases Today

Investors are also awaiting critical economic data releases today, including US JOLTS Job Openings, which could offer guidance on labor market health, and Australian GDP figures, expected to shed light on the country's economic growth trajectory. These releases could further shape market sentiment and currency movements in the coming days.