Markets Rally as Trump Delays EU Tariffs; Macro Data Turns Positive Ahead of NVDA Earnings

A much-needed relief rally hit Wall Street as President Trump delayed the planned 50% tariff on European imports, now pushed to July 9. That move, combined with surprisingly strong U.S. macro data—durable goods, home prices, and confidence surveys—gave investors something to cheer about after weeks of softness. Small caps and tech led the charge, while bond yields eased globally following central bank moves in Japan. Now, all eyes turn to NVIDIA’s earnings to determine the next market move.

A net good day for U.S. macro—for the first time in five weeks.

President Donald Trump announced a delay in imposing a 50% tariff on European Union imports, now postponed to July 9. This move alleviated investor concerns over escalating trade tensions and reignited optimism for a potential U.S.-EU trade agreement.

The Dow Jones Industrial Average surged 740 points (1.8%) to close at 42,343.65, the S&P 500 climbed 2% to 5,921.54, and the Nasdaq Composite advanced 2.5% to 19,199.16.

All eyes now turn to NVDA’s highly anticipated earnings.

Let’s dive in:

🧭 Macro Overview: Hard Data Fights Back

Markets got a rare dose of optimism heading into the long weekend thanks to a tariff delay for the European Union, which helped set a positive tone. At the same time, Japan’s bond market panic forced their central bank to step in aggressively to stabilize yields—highlighting just how fragile the global bond picture really is.

In the U.S., the narrative began to shift. After weeks of “soft” survey data clashing with reality, core durable goods orders came in strong, suggesting real underlying demand. Meanwhile, home prices declined slightly in May per the Case-Shiller Index—cooling off what had been a red-hot housing market.

Even the Conference Board’s confidence report showed a rebound across the board—except for inflation expectations, which fell sharply. The Dallas Fed’s manufacturing survey? Way above expectations. In short, this was the first “net positive” macro day in over a month.

📈 Equities: Small Caps and Tech Lead a Rebound

Despite a weak open, stocks snapped back hard throughout the day. Small caps and the Nasdaq led the charge, but the real outperformance came from mega-cap tech, with the MAG7 stocks up nearly 3%, while the rest of the S&P (the other 493 names) gained about 1.5%.

Hedge funds were heavy buyers, particularly via Goldman’s trading desk flow:

• Longs in Industrials outpaced shorts in Consumer Discretionary, Staples, Financials, and Healthcare.
• Net buying focused on Tech, Healthcare, and macro themes, while Staples saw consistent outflows.

Early on, 0DTE (zero days to expiration) call buyers helped set the tone. The buying pressure was real and broad, and all major indices are now testing or nearing key technical levels, with the Dow stalling right at its 200-day moving average.

Tesla (TSLA) shares surged 6.9% on Tuesday, closing at $362.89, significantly outperforming the broader market. This rally was fueled by CEO Elon Musk's announcement of renewed focus on Tesla, including plans to spend "24/7 at work" and sleep in company facilities. Investors were also encouraged by Musk's commitment to launch a self-driving robotaxi service in Austin next month, signaling potential growth in autonomous vehicle services. Despite recent declines in European sales, the stock's strong performance reflects renewed investor confidence in Tesla's future prospects.

👀 Spotlight on NVDA Earnings

Before we turn the page, all eyes shift to Tuesday’s post-market earnings report from NVIDIA—the main event that could dictate short-term sentiment in semis and broader tech. Volatility around this event could spill into the broader market, especially with such concentrated gains recently in the mega-cap space.

📉 Bond Market: Japan Moves First, U.S. Follows

Japanese bond yields tumbled sharply, as rumors swirled that the Japanese Ministry of Finance may adjust their super-long bond issuance next fiscal year. That triggered a ripple effect globally:

• U.S. long-end Treasuries rallied hard
• The 30-year UST yield fell below 5.00%, giving bond bulls some breathing room
• The move helped support equities and reinforced the idea of a softening macro tone globally

💱 Dollar Strength, Gold and Oil Hit

The U.S. Dollar caught a bid, partly due to the Japanese yen weakening sharply, and that move had ripple effects:

• Gold dropped, finding support near the $3,300 zone
• Oil sank, dipping to the low-$60s per barrel (WTI)
• Meanwhile, Bitcoin surged back above $110,000, reclaiming a key psychological level

🔮 What Are Institutional Investors Watching?

Goldman Sachs surveyed 800 institutional investors about summer risks: • 37% cited trade policy as their top concern • 26% pointed to U.S. economic growth • 23% flagged the budget deficit

Interestingly, despite all the macro noise, the Conference Board’s survey showed a sharp drop in investor uncertainty, even though global trade policy risk edged slightly higher today.

✅ Key Takeaways:

• First “net positive” macro day in five weeks
• Stocks are back at key resistance zones—especially the Dow
• Hedge funds buying tech and healthcare aggressively
• Bond yields cooling off; 30-year UST under 5%
• NVDA earnings Tuesday will be the catalyst to watch

Stay tactical. We’re entering a high-stakes summer stretch with big moves, major headlines, and narrow leadership. Use the volatility to your advantage.

Cheers to the week ahead, — Carlos G. GAR Capital