Markets Slip After Record Highs as Tariff Tensions Rise; Copper and Oil Prices Surge

Last week, the Trump administration sent letters to dozens of trading partners informing them of country-specific reciprocal tariff rates ranging from 20% to 50%. The levies were initially slated to take effect on July 9 but were pushed back until August 1, presumably to leave room for continued negotiations. The stock market seemed to shrug off tariff news for much of the week before falling back from Thursday’s record highs on Friday and ending slightly in the red. The dollar and gold prices both advanced during the week. U.S. copper prices soared to all-time highs on Tuesday after President Trump said the United States will impose a 50% tariff on imported copper, a metal that is a critical component in many different types of manufactured goods. And on Friday, Trump announced that a major statement on Russia was forthcoming, which led to a spike in oil prices caused by expectations of additional sanctions on Russian energy.

June Sees $27B Budget Surplus, but FY25 Deficit Climbs to $1.34 Trillion

The Treasury budget posted a small surplus of $27.0 billion in June, following May’s $315.7 billion deficit. For fiscal year 2025, the deficit sits at $1,337 billion, compared to $1,273 billion over the same period in the prior fiscal year. To date in FY25, total receipts equaled $4,008 billion, while total outlays were $5,345 billion.

Eye on the Week Ahead 

Inflation data for June is available this week with the release of the Consumer Price Index, the Producer Price Index and the retail sales report. Overall, inflationary pressures have been generally muted; however, prices ticked up in May. The June data could begin to reflect the impact of tariffs on goods and services prices.