Morning Wrap: ASX 200 futures flat, S&P 500 and Nasdaq at all-time highs, US-EU secure trade deal

ASX 200 futures are down 5pts (-0.05%) as of 8:30 am AEST.

In a nutshell:

• Major US benchmarks finished broadly higher, with the S&P 500 and Nasdaq both up over 1.0% last week

• US and EU clinched a trade deal, with the EU set to purchase up to US$750bn of American energy products and invest $600bn in the US

• Massive week for corporate earnings, approximately 38% of the S&P 500 reports this week and ASX reporting season to kick off, with Pilbara Minerals FY25 result on Wednesday

Let's dive in.

S&P 500 SESSION CHART

S&P 500 gapped up, trended higher to close at best levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks finished broadly higher, with stocks closing a little off best levels

• S&P 500 and Nasdaq both notched fresh all-time highs, marking their 8th and 12th record closes, respectively, so far this month

• Today’s big story – No major directional drivers for the overnight session, but S&P 500 futures currently up ~0.3% following US-EU trade deal announcement over the weekend

• US weekly recap: S&P 500 (+1.46%), Dow (+1.26%), Nasdaq (+1.02%), Russell 2000 (+0.94%)

• Humming corporate profit engine can keep powering stocks rally, around 83% of S&P 500 companies have exceeded analysts' estimates (BBG)

• Value investing is making a comeback as investors become more wary of overvalued Big Tech (WSJ)

• Latest speculative frenzy lifting risk of possible broader market downturn, says Goldman Sachs (YF)

• Money managers boosted their bullish bets on gold to the highest since April (BBG)

• BofA Hartnett warns of rising stock market bubble risk as monetary policy loosens alongside an easing in financial regulations (BBG)

• Japan equity market's climb to record high stokes overheating concerns with technicals flashing warning signs (BBG)

STOCKS

• Intel (-8.5%) earnings, margin guidance miss market expectations, company to cancel some factory projects and take a more conservative approach to future spending (BBG)

• Luxury industry is facing flat sales following a weak 2024, its worst year since 2008 despite no global recession (WSJ)

• Puma warns of full-year loss (RT)

• Volkswagen reported a €1.3bn tariff impact in the second half, cut 2025 profit margin forecasts to 4-5% (BBG)

CENTRAL BANKS

• BOJ officials mull potential rate hike this year after US-Japan trade deal announcement (BBG)

• China's central bank injects US$84bn in Jan-Jun to stabilise financial markets (RT)

• Economists predict BoE will cut rates in August and November amid steady economic growth (RT)

TARIFFS & GEOPOLITICS

• US and EU reach broad tariff deal, deal includes – agreement to open up trade at 0% tariff, EU to buy up to $750bn of US energy, EU to purchase ‘vast amounts’ of US autos, tariffs on autos lowered to 15% (BBG)

• US and China expected to extend trade truce by 90 days (BBG)

• Trump says US may not reach trade deal with Canada (BBC)

• Trump's string of trade deals with Asian countries raises hope of further tariff relief for China (NK)

• India's commerce minister voices optimism about reaching US trade deal by 1-Aug (BBG)

• US and South Korea aim for trade deal by 1-Aug, considering concessions (BBG)

• Australia eases US beef import restrictions; Trump warns other countries about refusing US beef products (BBG)

ECONOMY

• US July durable goods orders fell 9.3% month-on-month vs. consensus for an 11% decline, this follows a 16.5% jump in the previous month, though this marks the largest month-on-month drop since Mar-20 (BBG)

• China's budget deficit hit a record 5.25tn yuan in the first half, driven by efforts to boost domestic demand amid US tariffs (BBG)

• UK retail sales climbed 0.9% in June after plunging 2.8% in May (BBG)

ASX TODAY

Check out our Live Blog for the latest coverage and analysis for company announcements, market movements and economic updates.

• S&P/ASX 200 finished 1.0% lower last week, largely weighed by banks including CBA (-5.2%), NAB (-4.2%), Westpac (-3.7%) and ANZ (-1.9%) as well as Macquarie (-5.8%) fell on soft first-quarter results

• Clarity Pharmaceuticals readies mega $200m capital raising to fund further research trials (AFR)

• Lendlease’s retirement village stake could be weeks away from a significant sale, with advisers receiving bids from at least three parties (AFR)

• Strike Energy major shareholder Carnarvon Energy discloses 13.04% stake (STX)

• The Lottery Corp appoints Wayne Pickup as CEO (TLC)

• WiseTech Global appoints Zubin Appoo as CEO, Appoo worked at Wisetech between 2004 and 2018, and recently served as CTO of InLoop, Fleixschools (WTC)

WHAT TO WATCH TODAY

• Stocks to rise on trade developments: US-EU and China truce extension likely to place upward pressure on stocks, S&P 500 and Nasdaq futures currently up around 0.3-0.4%. Overall, a relatively quiet overnight session and start to the week.

BROKER MOVES

• EVT retained Buy; target up to $18.15 from $16.12 (CITI)

• Fortescue downgraded to Sell from Neutral but target up to $17.40 from $16.20 (UBS)

• Whitehaven Coal downgraded to Neutral from Buy but target up to $7.20 from $7.00 (CITI)

• Whitehaven Coal downgraded to Neutral from Overweight; target remains $6.10 (JPM)

• Whitehaven Coal downgraded to Hold from Buy; target cut to $6.90 from $7.10 (BP)

Stocks trading ex-dividend: 

• Mon 28 Jul: AVJennings (AVJ) – $0.167, Spheria Emerging Companies (SEC) – $0.036

• Tue 29 Jul: None

• Wed 30 Jul: KKR Credit Income Fund (KKC) – $0.017, Mirrabooka Investments (MIR) – $0.065

• Thu 31 Jul: None

Other ASX corporate actions today: 

• Dividends paid: None

• Earnings: None

• IPOs: None

• AGMs: BWP Trust (BWP)

Economic calendar (AEST):

No major economic announcements.