A New Round of Trade Talks Between Washington and Beijing

A New Round of Trade Talks Between Washington and Beijing: In a new development toward easing trade tensions
between the United States and China,
Top negotiators from both sides held a meeting on Thursday on South Korea’s Jeju Island.
This came just days after an agreement in Switzerland to suspend specific mutual tariffs for 90 days.

 

Content

Trade Talks
Eurozone
India


A New Round of Trade Talks Between Washington and Beijing

In a new development toward easing trade tensions between the United States and China,
top negotiators from both sides held a meeting on Thursday on South Korea’s Jeju Island.
This came just days after an agreement in Switzerland to suspend specific mutual tariffs for 90 days.

According to a South Korean government source, U.S. Trade Representative Jamieson Greer met
with China’s top trade negotiator, Li Chenggang, in what was described
as a continuation of bilateral talks aimed at curbing the escalating trade conflict between the world’s two largest economies.

No further details regarding the content or outcomes of the meeting have yet been released.

These talks are viewed as an exploratory step toward laying the groundwork for broader negotiations,
especially amid mounting pressure from the private sectors in both countries,
which have been affected by rising import and export costs due to the trade war.

According to official Chinese data, Chinese shipments to the U.S. fell by 21% year-on-year in April,
while imports of American goods declined by 14% during the same period,
a clear indication of the profound impact of the tariffs.

 

Eurozone Economy Sees Moderate Growth in Q1, Supported by Strong Labor Market

According to preliminary data released by Eurostat on Thursday,
the Eurozone economy grew by 0.3% in the first quarter of 2025.
This suggests a continued, albeit modest, recovery despite external challenges, chiefly global trade tensions.

Although the growth rate came in slightly below the initial estimate of 0.4%,
it still represents a mild improvement over the final quarter of 2024,
which saw 0.2% growth. On a year-on-year basis, the GDP of the single currency area remained steady at 1.2%,
reflecting relative stability in overall economic performance.

Meanwhile, labor market data showed improvement,
with employment rising by 0.3% in Q1—the highest quarterly growth rate in a year.
This indicates that job creation remains strong despite the global economic slowdown.

Among the major member states, Spain led the way with 0.6% growth,
followed by Italy at 0.3%,
while Germany — Europe’s largest economy — recorded a more modest 0.2% growth.

 

 

 

 

Trump: India Offers to Eliminate Tariffs on U.S. Goods Amid Escalating Trade Talks

U.S. President Donald Trump announced that India has offered to completely remove tariffs
on American goods to ease trade tensions between the two countries.
New Delhi recently threatened retaliatory tariffs in response to increased U.S. steel and aluminum import duties.

Trump made the remarks during an event with business leaders in Doha, Qatar,
stating that the Indian government “has proposed a deal to eliminate all tariffs on U.S. products.”
a clear indication of both sides’ desire to avoid a full-blown trade war.

In a related note, Trump mentioned he had spoken with Apple CEO Tim Cook
to dissuade him from expanding the company’s production in India.
He emphasized that Apple plans to boost its investments within the United States instead of shifting operations abroad.

India’s Minister of Commerce is expected
to visit the U.S. from May 17 to 20 for a new round of negotiations.
These talks are part of preparations for the first phase of a trade agreement between the two countries.
The agreement was initially agreed upon during Indian Prime Minister Narendra Modi’s visit to Washington last February.
The deal is expected to be finalized by fall.

This development comes as the Trump administration is working
to reduce the trade deficit with major partners by renegotiating outdated trade terms and applying
direct pressure to open markets to American exports.
India’s response is a positive sign of the policy’s effectiveness,
potentially boosting market confidence and easing global trade tensions.

 

A New Round of Trade Talks Between Washington and Beijing

Oil Prices Decline Amid Prospects of a Potential Nuclear Deal

Oil Prices Decline Amid Prospects of a Potential Nuclear Deal and Global Demand Slowdown

Dual pressures weigh on oil prices as signs point to a nuclear agreement and anticipated demand stagnation.

 

Contents

 

Oil

Oil prices dropped significantly on Thursday amid growing signs that the United States is close to reaching a nuclear agreement with Iran,
alongside investor reaction to the International Energy Agency’s (IEA) report,
which pointed to a potential slowdown in global crude demand growth.

Brent crude futures for July delivery fell by 3.7%, or $2.44, to settle at $63.65 per barrel.
Meanwhile,
West Texas Intermediate (WTI) crude for June delivery dropped by 3.95%, or $2.49, to $60.66 per barrel.

These declines come as U.S. President Donald Trump stated during his Gulf tour that
the U.S. is “very close” to reaching an agreement with Iran over its nuclear program,
adding that Tehran had “somewhat agreed” to the proposed terms, according to AFP.

On another front, the International Energy Agency (IEA) released its monthly report,
forecasting that global oil demand growth will slow to
650,000 barrels per day for the rest of the year,
compared to
990,000 barrels per day in the first quarter.
The agency attributed the slowdown to ongoing global economic challenges, as well as record-high electric vehicle (EV) sales,
which continue to negatively impact fossil fuel consumption.

 

 

Oil Prices Decline Amid Prospects of a Potential Nuclear Deal

Gold and Oil Prices Decline Amid Improving Geopolitical Relations

Gold and Oil Prices Decline Amid Improving Geopolitical Relations and Diminished Rate Cut Hopes

Gold and oil prices are experiencing sharp fluctuations driven by geopolitical developments and fading expectations of a swift U.S. interest rate cut.

 

 

Contents

 

 

 

 

Gold

Declines Amid Weak Demand and Reduced Rate Cut Bets

Gold prices stabilized on Thursday after a sharp drop of over 2% on Wednesday,
as demand for the precious metal as a safe haven weakened and expectations of interest rate cuts by the U.S. Federal Reserve diminished.

Spot gold rose slightly by 0.2% to $3,182.85 per ounce as of 8:04 a.m. in Singapore, remaining near its lowest level in over a month.
During early trading, prices hovered above
$3,182 per ounce,
influenced by rising U.S. Treasury yields amid optimism that the Fed might delay rate cuts due to improving economic indicators.

Gold typically has an inverse relationship with interest rates, as higher yields reduce its appeal given that it does not generate income.

 

Trade Talks Reduce Gold’s Safe-Haven Appeal

Downward pressure on gold prices was further driven by continued progress in U.S.–China trade negotiations.
On Wednesday, China announced the suspension of restrictions on exports of rare earth metals and certain technologies
—moves that were welcomed by markets and seen as signs of easing geopolitical risks.

This diplomatic progress reduced demand for gold as a safe-haven asset and led to a sharp rally in riskier assets.
Nevertheless, gold remains up by more than
20% since the beginning of 2025,
after reaching a peak above
$3,500 per ounce in April, driven by fears of inflation, slowing growth,
and potential recession amid prior tariff tensions.

 

 

Oil

Oil Prices Continue to Decline Amid Optimism Over a Nuclear Deal with Iran

WTI crude nears $62 while Brent settles around $66 per barrel

Oil prices extended their losses for a second straight day, as West Texas Intermediate (WTI) fell close to $62 per barrel,
and
Brent crude closed near $66, following a report suggesting Iran is willing to abandon its military nuclear ambitions in exchange for lifted U.S. sanctions.

NBC reported, citing senior Iranian advisor Ali Shamkhani,
that Tehran is open to signing an agreement under specific conditions—fueling optimism about the return of Iranian oil to global markets
and contributing to the latest price drop.

 

U.S. Inventory Build Adds Pressure

These developments came after government data revealed the largest weekly build in U.S. crude inventories since March,
ending a four-day rally that saw prices gain nearly 10%.

Despite recent fluctuations, oil remains down approximately 13% year-to-date, amid ongoing signs of an oversupplied market.

 

Gradual Resumption of OPEC+ Supply

Meanwhile, OPEC+ began gradually restoring oil supply last month after halting production since 2022.
However, the group added only
25,000 barrels per day in April, far short of its planned increase of 138,000 barrels per day.
The alliance is expected to review another potential output hike at its next meeting scheduled for
June 1.

Separately, the International Energy Agency (IEA) is set to publish its monthly global supply and demand outlook on Thursday from Paris,
a report closely monitored by investors and traders alike.

 

 

 

Gold and Oil Prices Decline Amid Improving Geopolitical Relations

Guide to Quantitative Trading and How It Drives Markets

Guide to Quantitative Trading and How It Drives Markets:
In today’s fast-paced trading world, relying solely on instinct or news is no longer enough.
Many investors and traders now use strategies that rely on data and algorithms to make quick and effective decisions.
This is where quantitative trading comes in—one of the most advanced trends in financial markets.

In this article from Evest, we’ll take you on a journey to understand quantitative trading,
How it works, and why it has become a core part of institutional and individual trading strategies.

 

 

Contents

What is Quantitative Trading

How Does Quantitative Trading Work

What Makes Quantitative Trading Unique

Is Quantitative Trading Right for Everyone

Evest

Conclusion

 

 

 

 

What is Quantitative Trading

Quantitative trading is a trading method that relies on quantitative analysis using mathematical models,
statistics, and algorithms to identify trading opportunities.
Quantitative trading depends on real data and historical market patterns
Rather than making decisions based on emotions or subjective analysis.

 

How Does Quantitative Trading Work?

Quantitative strategies typically follow four key stages:

  1. Data Analysis: Collecting market data such as prices, volumes, indicators, and news.
  2. Model Development: Creating mathematical models that define entry and exit rules.
  3. Backtesting: Testing the model on historical data to evaluate its performance.
  4. Automated Execution: Implementing trades electronically with high speed and precision.

 

What Makes Quantitative Trading Unique?

Emotion-Free Trading: Strategies are based on formulas, not feelings.
High-Speed Execution: Thousands of trades can be executed in fractions of a second.
Precise Risk Management: Position size and risk levels are calculated mathematically.
Backtesting Capabilities: Strategies can be tested before committing real capital.

 

 

Is Quantitative Trading Right for Everyone?

While quantitative trading is often used by hedge funds and large financial institutions,
Its concepts and tools are becoming increasingly accessible to individual traders,
especially with modern platforms like Evest,

which offer advanced technical and statistical analysis tools that empower you to make data-driven

trading decisions without deep programming skills.

With Evest, you can:

  • Use ready-made technical indicators and statistical models
  • Analyze market patterns and identify opportunities with precision.
  • Access live data and enjoy fast trade execution

Although full-scale quantitative trading usually requires:

  • A solid understanding of mathematics and statistics
  • Programming skills (e.g., Python, R)
  • A fast and automated trading environment

Evest gives you a powerful start by offering intelligent analytics and technical tools that guide

You step by step toward quantitative-style trading in a simple and user-friendly format.

 

 

 

How Can Evest Support You in Quantitative Trading?

Evest provides an ideal environment to help traders:

  • Dive deeper into market analysis
  • Access advanced technical tools.
  • Execute trades with speed and accuracy.
  • Build data-driven strategies

Whether a beginner or an experienced trader,
you can use Evest’s quantitative tools to make smarter investment decisions.

 

Conclusion

Quantitative trading is the future of the markets. It’s the perfect approach for those seeking speed,
efficiency and discipline in trading decisions.
Integrating this type of trading into your strategy will become more seamless as technology evolves.

 Don’t let the markets surprise you—let the numbers work for you.
Start your quantitative trading journey with Evest today.

 

 

Guide to Quantitative Trading and How It Drives Markets

Market Volatility Follows a Historic Rally

Market Volatility Follows a Historic Rally: Global financial markets show notable
divergence following a powerful rally led by Wall Street in the aftermath of the April crash.

The surge reflects signs of fatigue and growing concern over overvalued equities,
adding to broader worries about market volatility across regions.

This comes amid waning momentum in both U.S. and Asian markets,

despite continued support from a U.S.-China trade truce, major Gulf region deals, and European agreements.
This phase confirms that market volatility follows even the strongest rallies when fundamentals are questioned.

 

 

Contents

Wall Street

Historic Boeing Deal

Ongoing Caution

Dollar Steady

Rate Cut Expectations

Mixed Market Views

Overbought Signals

Speculators Return

Commodities Performance

 

 

 

 

Wall Street Falters After a Sharp Climb

Following a 22% jump from April lows, the S&P 500 entered a volatile phase as most major sectors declined,
Except for mega-cap tech companies, which continued to climb.
The “Magnificent Seven” index (Apple, Alphabet, Nvidia, Amazon, Meta, Microsoft, Tesla) rose 1.7%.

The Nasdaq 100 gained 0.6%, boosted by Nvidia, which erased its 2025 losses entirely.
Meanwhile, the Dow Jones Industrial Average fell 0.2%, and the S&P 500 increased 0.1%.

In Asia, stocks fell for the first time in five sessions.
Indices in Japan and Australia, along with U.S. futures, declined.
Mainland China and Hong Kong saw slight drops amid fears that recent gains might be overextended.

 

Historic Boeing Deal Lifts Stock

In parallel, Boeing shares soared after signing the largest deal in its history with Qatar Airways
to purchase long-range aircraft during President Donald Trump’s visit to Doha—a bright spot on an otherwise subdued trading day.

 

Caution Persists Despite Trade Truce

The trade truce between the U.S. and China, agreements with the UK, and notable Gulf region deals
helped ease some investor concerns.
China also suspended restrictions on rare earth exports and other military-use tech,
following a temporary 90-day tariff reduction agreement with the U.S.

Still, Mark Hackett of Nationwide warned that the market has “shifted rapidly from oversold to overbought,”
which may hinder further gains without apparent economic acceleration.

 

Bond Yields Rise, Dollar Holds Steady

U.S. bond markets saw sell-offs on Wednesday,
pushing the 10-year Treasury yield to 4.53% (up seven basis points)—its highest in about a month.
2-year yields also hit their highest level since March.

Bloomberg reported that the U.S. does not plan to include monetary policy pledges in trade agreements,
helping the dollar trim losses.
The Bloomberg Dollar Index remained essentially unchanged.

 

Rate Cut Expectations Pushed Back

TD Securities joined other Wall Street banks in predicting a delay in Federal Reserve rate cuts.
Swap contracts are no longer priced in two-quarter-point cuts this year.

Austan Goolsbee, President of the Chicago Fed,
emphasized that policymakers shouldn’t react to daily market swings, citing stable economic data.
Vice Chair Philip Jefferson warned that tariffs and associated uncertainty could slow growth and stoke inflation,
but reaffirmed the Fed’s readiness to respond.

Krishna Guha of Evercore noted that Jefferson’s latest remarks leaned more dovish than previous hawkish tones,
signaling ongoing caution even amid U.S.-China easing.

 

 

 

 

Mixed Market Views

Analysts at Goldman Sachs, led by Peter Oppenheimer, described the rally as “too fast,”
comparing it to “event-driven bear market behavior,”
and warned that upside potential remains limited if weak economic data resurfaces.

Conversely, Rick Gardner of RGA Investments remained optimistic,
calling the tech-led rebound a “structural shift” after months of lackluster performance.
He expects the rally to continue, driven by AI optimism and reduced trade tensions.

 

Overbought Indicators and Risk of Correction

Matt Maley from Miller Tabak flagged overbought conditions, with the 7-day RSI at its highest since July
and CNN’s Fear & Greed Index nearing “Extreme Greed.” Still,
Craig Johnson of Piper Sandler views moderate pullbacks as buying opportunities,
especially in high-relative-strength sectors.

 

Speculators Return—Betting on Laggards

In a bold move, trading desks at Citigroup and JPMorganChase began targeting 2025’s biggest losers,
like small caps, tech equipment, and homebuilders—for short-term gains.

Stuart Kaiser from Citi also expressed a preference for weaker-balance-sheet stocks.
With U.S. benchmarks erasing year-to-date losses, investors who missed the earlier
rally are now hunting for entry points before new trade tensions emerge.

Daniel Skelly from Morgan Stanley urged buying dips rather than chasing rallies.
At the same time, David Lefkowitz of UBS Global Wealth Management maintained a neutral but optimistic stance,
expecting the bull market to extend into next year despite potential soft economic data acting as a modest headwind.

 

Gold Rebounds, Oil Slips

Gold rebounded after a 2.3% drop to a one-month low in the previous session.
Meanwhile, oil prices fell for the second day following a government
report showing the largest crude inventory build in two months.

 

Market Volatility Follows a Historic Rally

Persistent Tensions Between Global Powers

Persistent Tensions Between Global Powers: U.S.–China Trade Disruptions

In a complex global landscape, economic warnings intersect with bold moves in digital currencies
and rising technological escalation

reflecting ongoing geopolitical and trade tensions despite attempts at de-escalation.

 

Contents

 

 

 

 

Fitch

U.S.–China Trade De-escalation Doesn’t Signal “Normalization” as Risks Persist

Credit rating agency Fitch has warned that the recent temporary easing in trade relations between the United States
and China does not represent a full normalization of trade interactions between the two countries,
emphasizing that the lack of a lasting agreement keeps uncertainty high.

In its report issued Tuesday, Fitch stated that the unclear future of tariffs,
along with the cumulative effects of previously imposed duties,
remain among the top pressures on macroeconomic outlooks, both in the U.S. and globally.

The agency pointed out that the 0.3% contraction in U.S. GDP during the first quarter of 2025 was partially driven
by companies rushing to import goods ahead of a new round of tariffs.

While recent tariff reductions may help ease direct economic pressures,
Fitch believes that global trade and supply chains remain exposed to major risks
limiting the impact of any de-escalation steps unless crowned with a comprehensive and
sustainable agreement between the world’s two largest economies.

 

El Salvador

Continues Buying Bitcoin Despite IMF Pressure

Despite its commitments under a loan agreement with the International Monetary Fund (IMF),
El Salvador’s government continues to boost its bitcoin reserves—a move reflecting President Nayib
Bukele’s commitment to digital currency as part of the country’s financial strategy.

The government’s “Bitcoin Office” revealed that the country purchased 6 additional bitcoins last week,
raising total government holdings to 6,175.18 BTC—worth over $639 million.
Over the past 30 days, El Salvador bought 29 bitcoins at a cost exceeding $3 million.

These purchases come in spite of the $1.4 billion loan agreement signed with the IMF last December,
which included terms prohibiting the use of public funds to buy bitcoin. In January,
the national parliament repealed the law recognizing bitcoin as legal tender
an effort to ease international financial concerns.

However, Bukele—well-known for his strong advocacy of cryptocurrencies—has ignored the IMF’s demands to halt bitcoin purchases,
insisting on his vision of integrating bitcoin into an economic strategy aimed at financial independence and boosting tech-sector investment.

 

Washington

Escalates Pressure: Global Warning Against Using Huawei AI Chips

The United States has intensified its pressure on China over artificial intelligence
by tightening export controls on technologies used in developing AI applications.
It issued a global warning to companies against using Huawei chips without a license—under threat of criminal penalties.

The Bureau of Industry and Security at the U.S. Department of Commerce confirmed
that using Huawei’s “Ascend” chips—advanced semiconductors used in AI—violates export control laws due to
their likely incorporation of American technology or manufacturing via U.S. equipment.

This warning was backed by reports in the Financial Times,
which indicated that three of Huawei’s key chips are now officially subject to U.S. export restrictions
—putting global users of these chips at legal risk unless they obtain prior licensing from Washington.

These developments come as Huawei has started distributing its own domestic AI systems to clients in China,
claiming performance superior to some U.S.-made Nvidia chips in terms of computing power and memory.
The U.S. views this as a direct challenge to Western dominance in the AI sector.

 

 

 

Persistent Tensions Between Global Powers: U.S.–China Trade Disruptions

Riyadh Summit Signals New U.S.–Saudi Economic Era

Riyadh Summit Signals New U.S.–Saudi Economic Era: In a scene blending politics and economics, Riyadh’s Saudi capital
welcomed U.S. President Donald Trump as he began an official visit to the Kingdom,
culminating in a bilateral summit with Crown Prince Mohammed bin Salman.
The visit was more than a diplomatic formality, carrying clear messages
and tangible projects that underscored a shift in the relationship between
The two nations are moving toward a more profound and comprehensive phase,
particularly in the economic sphere.

The summit at Al-Yamamah Palace announced agreements and investments exceeding $600 billion,
which, according to the Saudi Crown Prince, will rise to $1 trillion in the coming months.
These agreements significantly boost bilateral ties and span various strategic sectors.

 

Contents

Key Agreements

Potential Market Impact

 

 

 

 

Key Announced Agreements and Projects

A $20 billion Saudi investment in AI-powered data centers in the United States, led by the Saudi company Datavault.

A $142 billion U.S. defense deal to supply Saudi Arabia with advanced equipment and systems for the air force,
missile defense, and maritime security.

A $10 billion collaboration between the Saudi company Humane and the U.S.
Based on AMD, a comprehensive AI infrastructure will be built to connect Saudi Arabia and the United States.

Agreements over $80 billion with major U.S. tech companies, such as Google, Oracle, Uber, Salesforce, and AMD,
cover cloud computing, autonomous driving, advanced software, and AI.

A partnership between NEOM and Air Products (U.S.) to launch the world’s largest green hydrogen plant.

Agreements in the aviation sector, with Riyadh Air preparing to receive its first aircraft from Boeing
as part of a plan to build a fleet connecting more than 200 destinations.

Trump did not hide his admiration for the progress achieved in the Kingdom over recent years,
stating that “Riyadh has become today a commercial, cultural, and technological capital of the world,”
While Crown Prince Mohammed bin Salman described the partnership with the United States
as a “strategic extension that serves mutual interests and supports job creation in both countries.”

 

Potential Impact on Markets

This momentum in agreements could positively affect the U.S. and Saudi stock markets.
This expansion may cause companies such as Boeing, AMD, Oracle, and Uber to see their shares rally.
At the same time, the Saudi market is expected to experience optimism in the
tourism,
technology, and infrastructure sectors.

The summit also comes at a sensitive time marked by global trade tensions,
making it a potential calm signal
for markets,
especially with Trump’s hints at
lifting sanctions on Syria
and his clear support for
regional development initiatives led by the Kingdom.

The Riyadh Summit between Trump and Bin Salman was not merely a presidential visit
But an explicit declaration of a
new phase of economic partnership
With profound geopolitical and commercial dimensions.
It could directly stimulate investment, ease tensions, and drive financial markets positively.

 

Riyadh Summit Signals New U.S.–Saudi Economic Era

Goldman Sachs Rules Out Recession in the U.S.

Goldman Sachs Rules Out Recession in the U.S.: Goldman Sachs has ruled out the likelihood
of an economic recession in the United States soon,
Following the agreement reached between
Washington and Beijing to ease trade tensions through a three-month negotiation period,
During this time,
significant mutual tariff reductions were implemented.

 

Contents

Goldman Sachs

Bank of Japan

 

 

Goldman Sachs Rules Out U.S. Recession After Trade Deal with China, Revises Growth and Rate Forecasts

Goldman Sachs ruled out a U.S. recession soon after Washington and Beijing
agreed to ease trade tensions through a three-month negotiation window that included substantial reciprocal tariff cuts.

The bank lowered the recession probability to 35% from 45%,
citing the recent trade understandings as a
positive step toward economic stability.
It also
raised its forecast for U.S. GDP growth in 2025 by approximately 0.5 percentage points,
with new estimates ranging between
1% and 1.5%.

On the monetary policy front, Goldman Sachs expects
the Federal Reserve to implement three interest rate cuts this year and next.
The first cut is anticipated in
December instead of July,
followed by two additional reductions in
March and June 2026.
Previously, the bank had projected three rate cuts in 2025.

 

 

 

Bank of Japan: U.S. Tariffs Pose “Dual Risks” to Economy and Prices

Shinichi Uchida, Deputy Governor of the Bank of Japan,
warned that U.S. tariffs present
“dual risks” to Japan’s economy,
noting that they exert
downward pressure on growth while potentially pushing prices unexpectedly higher.

In remarks made on Tuesday, Uchida stated that the Japanese economy
is heading toward a
moderate slowdown approaching its natural levels.
Still, it is expected to
recover gradually alongside global economic improvement.
He pointed out that Japan’s
output gap will remain stable for now but is projected to improve
as the
fiscal year 2027 approaches.
This may prompt the Bank of Japan to
raise interest rates gradually if economic performance aligns with forecasts.

Uchida also noted that core inflation and medium-to-long-term expectations might
temporarily slow down despite wage increases driven by intense labor market competition,
enabling companies to pass wage costs on to consumers through higher prices.

On the currency front, he emphasized that a strong yen is a double-edged sword.
It reduces profits for exporters and major manufacturers but boosts household
purchasing power and supports
 retailers by lowering import costs.
However, he cautioned that
rapid exchange rate movements heighten uncertainty and complicate corporate investment plans.

Uchida stressed that the Bank of Japan will closely monitor economic data
without any preconceptions, especially in light of high domestic and global uncertainty,
particularly regarding the
potential impact of trade tensions on inflation and growth.

 

Goldman Sachs Rules Out Recession in the U.S

Oil Holds Steady and Gold Stabilizes Amid Global Shifts

Oil Holds Steady and Gold Stabilizes Amid Global Shifts

As oil prices settle and gold attempts to regain strength,
markets are closely watching political and economic developments
that could reshape global trading dynamics in the coming days.

Content

 

Oil

Calms After Gains as Political Signals Take Center Stage

Following a three-day rally, oil prices entered a phase of stability,
as market attention shifted from the U.S.–China trade agreement to rising geopolitical tensions in the Middle East.

West Texas Intermediate crude traded above $61 per barrel, while Brent hovered just below the $65 mark.
Futures retreated slightly after President Donald Trump signaled progress in nuclear talks with Iran
—raising the possibility of easing restrictions on Iranian oil exports, which weighed on global prices.

Upcoming Gulf Visit Carries Strategic Energy Implications

President Trump is set to begin his first international tour of his second term this week,
starting with a visit to Saudi Arabia—a key player in the OPEC+ alliance.
The visit comes as the coalition prepares for a June meeting, where increased production may be on the table to enforce quota compliance.
This potential output rise has contributed to downward pressure on oil prices this year.

Markets continue to absorb the aftershocks of the wide-ranging U.S. tariffs announced in April,
which triggered retaliatory measures, particularly from China—intensifying concerns about global energy demand.

Is Oversupply on the Horizon? Market Braces for Surplus Risk

Despite a temporary 90-day trade truce between Washington and Beijing, supply-side fears remain unresolved.
Analysts caution that a decision by OPEC+ to boost output could lead to a surplus later this year,
especially given the sluggish recovery in global demand.

Gold

Struggles to Shine After Sharp Drop

Gold’s steep decline paused temporarily, as the yellow metal tried to stabilize following a 2.7% fall earlier in the week.
Easing trade tensions between the U.S. and China shifted investor appetite toward riskier assets like stocks and currencies.

Spot gold hovered near $3,237 per ounce, while investors reassessed the impact of the temporary tariff
agreement between the world’s two largest economies.

A Strong Dollar Adds to Gold’s Challenges

Among the key pressures on gold has been the recent resurgence of the U.S. dollar,
which saw its strongest surge since the November elections, alongside a notable rise in U.S. Treasury yields.
Both developments weakened the appeal of gold as a non-yielding asset.

Looking ahead, market expectations have adjusted to pricing in just two rate cuts by the Federal Reserve in 2025,
amid a reevaluation of inflation forecasts—further dampening gold’s near-term attractiveness.

Markets Cautiously Await Clarity Despite Yearly Gains

Despite a year-to-date gain of nearly 25%, gold faces uncertainty.
Many investors remain cautious amid the lack of detailed clarity in the recent trade announcement,
wary that any renewed escalation could reignite gold’s bullish momentum.

As of early morning trading in Singapore, spot gold stood at $3,237.86 per ounce,
while the Bloomberg Dollar Spot Index remained flat following a 1% surge on Monday.
Meanwhile, silver, palladium, and platinum prices saw little to no movement.

Oil Holds Steady and Gold Stabilizes Amid Global Shifts

The Trade Truce and Its Impact on the Markets

The Trade Truce and Its Impact on the Markets: Wall Street investors who believe
that the trade truce between the United States and China
marks the end of the tariff war, which drove the
S&P 500 index to rise by over 3%,
while defensive assets such as
bonds, gold, and safe-haven currencies declined.
The
dollar also recorded its most significant gains since the November presidential elections.

 

Contents

Shift in Risk Appetite
Temporary Truce
Market Reaction

Broad Relief in Asia

Return to Risk

Trump

Inflation

Fed Warnings

 

 

 

 

A Shift in Risk Appetite Restores Market Momentum

This renewed risk appetite and declining recession expectations pushed
the index past the
“Liberation Day” level declared by President Donald Trump on April 2.
Major
tech stocks also rallied, pushing the Nasdaq 100 back into a bull market after falling 20% from its peak.

Amid signs of inflation expectations being recalibrated, Treasury yields rose,
as investors reduced expectations for
Federal Reserve rate cuts to only two in 2025.

Investors who had adopted defensive strategies during April’s turmoil faced many opportunities and risks,
particularly with positions such as
shorting the dollar, betting on stock volatility,
and anticipating multiple
rate cuts, which caused them to incur significant losses.

 

Temporary Truce and Major Tariff Cuts

Following high-stakes talks in Switzerland,
negotiators from the
world’s two largest economies announced a significant tariff reduction.
For 90 days, the
U.S. cut tariffs on Chinese products to 30% from 145%,
while
Beijing reduced its tariffs on most U.S. goods to 10%.

Jeff Buchbinder of LPL Financial described the move as a “major positive surprise,”
noting that eliminating worst-case scenarios is reassuring to markets.

 

Markets React Positively Worldwide

The S&P 500 surpassed its 200-day moving average, the Nasdaq 100 surged 4%,
and the
Dow Jones Industrial Average added over 1,000 points.

The “Magnificent Seven”Apple, Amazon, Nvidia, Alphabet, Meta, Microsoft, and Tesla
jumped by 5.7% amid renewed optimism about tech.

Meanwhile, Treasury contracts rallied and the 2-year yield climbed 12 basis points to exceed 4%,
before retreating by
3 basis points, reflecting declining bets on rapid rate cuts.

Although temporary, Carol Schleif of BMO Private Wealth said
this surprise tariff reduction was “exactly what equity markets were hoping for.”

Ulrike Hoffmann-Burchardi of UBS Global Wealth Management said the current optimism
was unexpected and indicates a clear shift in U.S. tone.

 


Broad Relief Across Asia

Asian stocks followed U.S. gains, with Japan’s TOPIX index leading,
extending its rally for a
13th straight day. Equities in Australia and Taiwan also rose.
However, after previous gains,
Hong Kong’s Hang Seng Index declined by 1%.

In China, optimism was palpable. The CSI 300 Index rose for a second consecutive day.
Patrick Pan of Daiwa Capital Markets wrote:
“We expect the wave of trade optimism to support Chinese equities in the near term,
and for the Hang Seng Index to revisit its March highs.”

He pointed to tactical electronics, textiles, shipping, and electrical equipment opportunities.

 

 

 

Return to Risk and Abandonment of Defensive Postures

Investors returned to Asian markets, shedding defensive positions popular in April,
amid hopes of halting the
U.S.-China economic decoupling.

HSBC strategists led by Max Kettner wrote:
“Markets are likely to anticipate more agreements soon.
Despite potential negotiation turbulence,
The shift in U.S. tone turns upcoming market dips into buying opportunities.”


Trump’s Comments Influence Investor Sentiment

President Trump’s remarks had an immediate market impact
His
April 9 statement that “it’s a great time to buy” was followed by a tariff freeze, then reaffirmed on May 8.

Morgan Stanley warned, however, that current momentum does not guarantee safety,
As only
two of the four conditions for a sustained rally have been met:

  • Optimism about a trade deal
  • Stabilized corporate earnings

Still absent are:

  • A more dovish Federal Reserve
  • Sub-4% bond yields without signs of recession

Inflation in Focus and Tariff Impact Ongoing

Chris Larkin of E*TRADE, part of Morgan Stanley,
emphasized that sustaining momentum requires support from
inflation data, retail sales, and corporate earnings.

He warned that stagflation narratives could undercut bullish sentiment,
despite signs of a resilient economy.

Swap contracts tied to monetary policy are now priced at a 56 basis point rate cut by December,
down from
75 basis points last week. The first quarter-point cut is expected in September.

 

Federal Reserve Cautions Against Overconfidence

A Federal Reserve Governor, Adriana Kugler, said that despite the recent tariff reductions,
the
Trump administration’s tariff policies may fuel inflation and hinder economic growth.

In a speech in Dublin, she noted: “Trade policies remain in flux and are likely to continue evolving,
even as of this morning.
Nevertheless, they are expected to have significant economic effects, even if tariffs stay near current levels.”

Austan Goolsbee, President of the Chicago Fed, added in a New York Times interview
that the trade deal’s temporary nature
 and high tariff levels burden growth,
posing long-term risks to prices and the broader economy.

 

The Trade Truce and Its Impact on the Markets