European equities continue to build on previous gains, with Eurostoxx futures up 0.5% in early trading. German DAX futures have increased by 0.6%, while UK FTSE futures remain unchanged.<\/p>\n
Despite potential tariffs threatened by Trump on China, the market sentiment remains steady. The US has experienced challenges due to China’s restrictions on rare earth exports. Trump’s reluctance to jeopardise the trade truce is supported by comments from Navarro, who downplayed the situation. US futures indicate a positive trend with S&P 500 futures rising by 0.3%, reflecting a continuation of the Wall Street rebound.<\/p>\n
Looking back at the market mood from years ago, we can see how sentiment hinged on threats of trade tariffs and subsequent walk-backs. The focus on a “trade truce” between the US and China created short-term buying opportunities in equities. That environment rewarded traders who reacted quickly to singular news items from officials.<\/p>\n
Today, the landscape for European derivatives is very different. That old optimism in Eurostoxx and the DAX now faces the reality of stubbornly high core inflation, which the latest figures show at 2.8% across the Eurozone. With German industrial production also contracting by 0.5% in the second quarter of 2025, we believe traders should consider buying protective puts on the DAX to guard against potential downside over the next few weeks.<\/p>\n
In the US, the conversation has moved far beyond the trade dynamics of that period. We are now focused on the Federal Reserve’s path as the latest jobs report, while solid with 190,000 jobs added, shows a distinct cooling from the blistering pace of early 2024. With the CBOE Volatility Index (VIX) currently low around 14, purchasing VIX call options could be a cheap way to insure portfolios against any hawkish surprises from the central bank.<\/p>\n
The nature of the US-China conflict itself has also fundamentally changed from the simple tariff threats mentioned in the past. The issue has since become a structural competition over key technologies, directly impacting supply chains. Therefore, a more nuanced approach is needed, such as using options to create pair trades that short semiconductor ETFs while going long on domestically-focused industrial sector funds.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" European equities gain, US futures rise amid steady sentiment, despite trade tensions and rare earth concerns.<\/p>\n","protected":false},"author":62,"featured_media":16988,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-28451","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/28451","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=28451"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/28451\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/16988"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=28451"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=28451"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=28451"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}