Global stock markets declined on July 4, 2025, as U.S. President Donald Trump’s sweeping tax-cut and spending bill cleared its final hurdle in Congress, while investor attention turned to the looming July 9 deadline for countries to secure trade deals with the U.S.
The bill’s passage, combined with tariff uncertainties, contributed to a cautious market mood, with the U.S. dollar weakening and safe-haven assets like gold gaining traction.
Market Movements and Trump’s Tax Bill
The U.S. House of Representatives narrowly approved Trump’s 869-page “One Big Beautiful Bill Act” on July 3, 2025, by a 218-214 vote, extending the 2017 tax cuts, introducing new breaks for tips and car loans, and boosting spending on military and border security.
The nonpartisan Congressional Budget Office estimates the bill will add $3.4 trillion to the U.S.’s $36.2 trillion debt over the next decade, raising concerns about fiscal sustainability.
The bill also cuts Medicaid and green energy incentives, sparking criticism for favoring the wealthy while reducing benefits for lower-income households.
The finance card shows the SPDR S&P 500 ETF (SPY) at $625.34, with a daily range of $622.43–$626.28, reflecting a 0.8% overnight gain before a 0.6% dip in S&P 500 futures on Friday, as U.S. markets closed for Independence Day.
The pan-European STOXX 600 index fell 0.5%, with banks, mining, and retail sectors leading losses, while export-reliant Asian markets, particularly Japan and South Korea, weakened due to tariff concerns.
Trade Deadline and Tariff Tensions
Trump’s July 9 deadline for trade deals has heightened market uncertainty, with the U.S. set to send letters specifying tariff rates for countries failing to reach agreements.
Only framework deals with Britain, China, and Vietnam have been secured, with progress stalling on Japan and South Korea.
U.S. Treasury Secretary Scott Bessent indicated a potential deal with India, but Trump expressed doubts about Japan, suggesting tariffs of 30–35% if no agreement is reached.
This shift from earlier optimism of “90 deals in 90 days” has rattled investors, contributing to equity weakness in Asia.
The U.S. dollar index fell 0.1% to 96.94, with the euro up 0.2% to $1.1778, reflecting concerns over the U.S. fiscal outlook and tariff impacts.
Economic Context and Investor Sentiment
A robust U.S. jobs report on July 3 bolstered confidence in economic resilience, driving a 1% Dow gain and supporting analyst Tony Sycamore’s view that markets could continue upward.
However, the bill’s $3.4 trillion debt increase and potential tariff hikes have pushed 10-year Treasury yields to 4.34% and gold to $3,336 per ounce as investors seek safe havens.
Brent crude fell to $68.23 per barrel, influenced by OPEC+’s planned output hike and Iran’s nuclear stance.
The bill’s Medicaid cuts, affecting 12 million people, and the phase-out of green energy credits have drawn criticism, with Democrats calling it a “tax scam” for the wealthy.
Meanwhile, internal Republican divisions over the debt ceiling and spending cuts highlight political risks ahead of the 2026 midterms.
Looking Ahead
As the July 9 trade deadline approaches, markets are bracing for potential tariff hikes that could disrupt global trade and trigger economic slowdowns.
Investors will monitor U.S. negotiations with key partners like the EU and India, while assessing the tax bill’s long-term impact on growth and deficits.
The SPY’s performance, as shown in the finance card above, suggests resilience but vulnerability to trade policy shocks.
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