The US stock market has kicked off the week with significant momentum, building on Friday’s impressive gains that saw the S&P 500 and Nasdaq Composite reach new record highs. Futures on Wall Street extended these gains into Sunday evening and Monday morning, signaling continued investor optimism. The Dow Jones Industrial Average, while still trailing its own record, also showed strong recovery, adding over 400 points on Friday and extending gains in pre-market trading.
On Friday, the S&P 500 closed at a record 6,173.07, marking a 0.52% increase, and has now recovered 28% from its April lows. The Nasdaq Composite also hit an all-time high, closing at 20,273.46 with a 0.52% rise, and has outperformed both the S&P 500 and Dow, recovering 37% from its April 7th lows. The Dow Jones Industrial Average gained 432.43 points, or 1%, to settle at 43,819.27, though it remains approximately 1,250 points shy of its landmark record. As of early Monday, Dow futures were up between 250 and 310 points, S&P 500 futures gained 20 to 30 points, and Nasdaq futures rose 90 to 140 points, indicating a strong start to the trading week, which will be truncated due to the Independence Day holiday on Friday. (CNBCTV18.com, Business Insider)
Several factors are contributing to this bullish sentiment. Hopes for successful trade negotiations, a subdued inflation print, and expectations of further rate cuts from the US Federal Reserve are all playing a role. Additionally, cooling tensions in the Middle East and signs of a robust US economy, as indicated by recent PCE data, are bolstering investor confidence. Consumer sentiment notably jumped to 60.7 in June from 52.2 in May, with consumers expecting inflation to rise 5% over the next 12 months, a decrease from the 6.6% expectation in May. (CNBCTV18.com)
However, the policy landscape remains dynamic. Senate Majority Leader John Thune is working to meet President Donald Trump’s July 4th deadline for passing a significant tax and spending bill. This bill includes a more aggressive phase-out of tax incentives for US wind and solar projects, requiring them to be fully operational by the end of 2027 to qualify, a tightening from the previous proposal that only required construction to begin by the end of 2025. The legislation also proposes a new tax on wind and solar projects that fail to meet strict restrictions against the use of Chinese materials, a move criticized by figures like Elon Musk as “utterly insane & destructive.” (CNBCTV18.com)
In international trade, Canada has rescinded its digital services tax on tech giants like Meta Platforms Inc. and Alphabet Inc. to restart trade talks with the US, following threats of fresh tariffs from President Trump. Meanwhile, South Korea is seeking exemptions from US tariffs on its auto and steel industries, with negotiations expected to extend beyond the July 9th deadline. On a positive note, British aerospace companies and UK car manufacturers are seeing reduced tariffs on exports to the US, though the UK’s steel industry still faces a 25% tariff. (CNBCTV18.com)
Globally, Asian markets opened higher, but European renewable energy shares, including Vestas Wind Systems and Orsted, slumped due to the proposed US tax incentive changes. BlackRock Inc. suggests European fixed income could benefit from investors shifting away from the US, citing unpredictable US policy and rising government debt. China’s economy showed signs of improvement in June, with manufacturing PMI at 49.7 and non-manufacturing at 50.5, though deflationary pressures persist. Japan’s industrial production, however, rose less than expected in May, impacted by US tariffs. (CNBCTV18.com)
In commodities, gold edged lower amid a risk-on mood and progress in trade talks, while oil prices fell following their biggest weekly loss in over two years, influenced by a fragile truce between Iran and Israel and anticipated OPEC+ supply increases. The cryptocurrency market presents a mixed picture: Bitcoin hit a record high in 2025, but many altcoins have seen steep declines, with over $300 billion in market value wiped out this year. (CNBCTV18.com)
Looking ahead, this week’s economic calendar includes key data releases such as non-farm payrolls, auto sales, and manufacturing and services PMI, which will provide further insights into the health of the US economy. The interplay of domestic policy, global trade dynamics, and economic indicators will continue to shape market movements.
