As the first half of 2025 is full of important developments, trade tensions, concerns about the independence of the US Federal Reserve (FED) and geopolitical risks will continue to be decisive in the rest of the year.
USA non -agricultural employment data, the European Central Bank (ECB) will organize the annual conference and China’s Purchasing Managers Index (PMI) data will be closely monitored in the markets.
The second period of the 1st year
While the first half of the year was left behind, US President Donald Trump’s starting to work in January was a development that would shake the markets. However, harsh fluctuations surprised even the most experienced processors.
Some processors described this period as “great change” once seen in the generation. The most powerful evidence is that the dollar has shown its worst performance in the first half of the year since the 1970s, when the free exchange rate regime began. Meanwhile, concerns about the increasing debt burden of the US increased.
The shares of the US technology companies, which are called “magnificent seven”, have been horizontal since the beginning of the year, while the shares of large Chinese technology companies rose by 20 %. While gold prices increased by 25 %, the shares of European defense companies rose by 60 %.
In the second half of the year, the markets will not breathe. Trump is determined to spend the “big beautiful” budget package until the US Independence Day on July 4th.
The 90 -day postponement, which Trump recognizes to dozens of countries where he raises customs duties, will end on July 9th.
2. Employment and Budget in the USA
Non -agricultural employment data, which will be announced in the US on July 3, will give clues to the course of the employment market at a time when investors discuss when the FED will make the next interest rate cut.
Economists who participated in the Reuters survey await non -agricultural employment in the United States to increase 129,000 in June. Non -agricultural employment in the United States increased by 139,000 in May. While the US celebrating the Independence Day on July 4, June non -agricultural employment data will be announced on July 3.
Considering the possible weakening in the employment market while evaluating interest rate cuts, the FED also follows inflation closely. FED President Jerome Powell, Congress this week, said that inflation may begin to rise in summer with increasing customs duties.
Investors closely monitor how Trump’s bill, including tax cuts and public expenditures, will progress in the Congress. Republicans hopes that the bill will be signed by Trump before the 4th of July Independence Day.
3. ECB Meeting
Next Tuesday, the ECB will meet in Portugal for an annual meeting. In the talks, the main agenda items will be what the authorities who identify interest rates such as ECB President Christine Lagarde and Fed President Powell about what they say about the endless geopolitical turmoil.
The date of July 9, which the tension, which has started to climb again in the Middle East, and the US to increase its customs duties again, causes uncertainty in the steps to be taken on the interest rate cut.
Investors will closely follow the clues regarding the course of ECB’s monetary policy. With Trump’s evaluation of the new FED president early, Powell came up again, while worries about the independence of the Fed were fueled.
The ECB may explain the results of the strategy assessment that started in March. In the chaos after the pandemi, the authorities stood behind the aggressive incentive decisions for the economy in the last decade, avoiding calls for self -criticism.
EURO ZONE TÜFE data, which will be announced on Tuesday, will show whether inflation has returned to this target in June after being below its target of 2 percent in May.
4. China’s disruptive economic recovery
Half of 2025 has been completed, but China’s long -awaited economic recovery has not yet gained significant acceleration.
In China’s PMI data, which will be announced on Monday, it seems that Trump’s customs duties affect the manufacturing activities seem to meet the same internal depressing picture.
The PMI data compiled by Caixin/S&P will be announced on Tuesday the day after the official data. The bar is relatively low to overcome the numbers published in May and disappointed.
Although Chinese officials make optimistic explanations about the growth appearance of the economy, there are still major uncertainties.
Deflationist pressures in Turkey continue to increase. The fragile trade ceasefire between China and the United States does not seem to solve all problems. Although the tensions between the two largest economies in the world have been shelved for now, it maintains its existence.
The volume of 5. M & A transactions increases
Within the framework of customs duties and increasing imbalance in the market, the first half of this year was not as bad as expected in terms of merger and acquisition (M&A) transactions. For example, according to Dealogic data, there has been a major increase in M&A transactions in China and Japan until 23 June from the beginning of this year. In Hong Kong, Shein is expected to be a public offering as a development that will increase the exports of stocks throughout Asia.
Global M&A transactions remained below the record level in 2021, while this year’s transactions increased by 25 %compared to the same period last year and managed to increase over $ 2 trillion.
Although the transactions that took place this year were less in number, they were larger in volume. Charter Communications’ opponent’s opponent Cox Communications to merge with the $ 22 billion offer can be shown as an example of these large volume transactions. This trend for M&A transactions seems to continue its continuity in the USA. In the country, M&A transactions increased by 8 %and reached almost 885 billion dollars.
Although KPMG said that almost all of the companies have affected M&A plans with M&A consulting companies in the United States, but three -quarters of companies expect M&A transactions to increase compared to last year.
According to approximately two -thirds of companies, possible changes in tax policy swells on M&A transactions, while the Trump administration’s approach to competition laws will facilitate the transactions.
