Markets Rally Amid Vietnam Trade Deal And Jobs Mixed Signals

U.S. markets hit fresh records despite a surprise June decline of 33,000 private-sector jobs per ADP. Investor optimism centered on a new U.S.-Vietnam trade deal: Vietnam’s exports to the U.S. face a lower-than-feared 20% tariff (down from a proposed 46%), while the U.S. gains tariff-free access to Vietnam, easing cost pressures for brands like Nike, Crocs, and Lululemon. The Vietnam stock index jumped on the news. Separately, the White House reversed export curbs on chip design software, allowing Synopsys and Cadence to restore access for China. Meanwhile, Hong Kong’s IPO market surged, positioning the city to lead global listings in 2025. The contrast between market gains and weak jobs data raised concerns about a disconnect from the real economy.

- Wall Street shrugged off a surprise decline in U.S. private-sector jobs in June (ADP: -33,000 vs. +100,000 expected) and focused on trade news. - President Trump announced a U.S.-Vietnam deal imposing a 20% U.S. tariff on Vietnamese imports (down from a proposed 46%) while granting U.S. tariff-free access to Vietnam, easing cost pressures for brands manufacturing there (e.g., Nike, Crocs, Lululemon). - The S&P 500 and Nasdaq closed at record highs; Europe’s Stoxx 600 rose modestly; U.K. bond yields jumped amid Labour Party turmoil. - Tesla Q2 deliveries fell 14% year over year to 384,122 but beat some fears, lifting shares. - JPMorgan warns a weak official payrolls report could spark a market sell-off. - In China, a sluggish macro picture contrasts with rapid AI-driven industrial advances and growth in smaller cities.

European stocks were set to open higher Thursday, with futures pointing to gains for the FTSE 100, DAX, CAC 40 and Italy’s FTSE MIB after a volatile U.K. session Wednesday that saw gilt yields jump and the FTSE fall amid political pressure on Finance Minister Rachel Reeves. U.K. gilt yields edged slightly lower early Thursday. Global focus turns to U.S. nonfarm payrolls, with economists expecting 110,000 jobs added and a tick up in unemployment to 4.3%. In a significant policy shift tied to a U.S.-China trade truce, the Trump administration lifted restrictions on chip design software sales to China, as noted by Synopsys and Cadence. In Asia, Vietnamese stocks hit a three-year high following news of a new U.S.-Vietnam trade arrangement.

U.S. stocks rose in a holiday-shortened session Thursday, with the S&P 500 and Nasdaq closing at record highs. The Dow gained 0.77%, S&P 500 0.83%, and Nasdaq 1.02%. A stronger-than-expected June jobs report (147,000 payrolls, unemployment down to 4.1%) boosted confidence in the economy and pushed Treasury yields higher, reducing odds of a July Fed rate cut. Markets also tracked trade policy as tariff pauses near expiration and Trump’s U.S.-Vietnam deal stirred expectations for further announcements. The administration signaled extensions are at the president’s discretion and downplayed tariff harm. Progress on Trump’s tax megabill supported sentiment. Solar stocks rallied as a Senate version dropped a tax on projects; CrowdStrike, Synopsys, and Cadence climbed on positive catalysts including eased export restrictions on chip design software. Burford Capital jumped after a proposed tax on litigation finance was stripped. For the week, the Dow rose 2.3%, S&P 1.7%, and Nasdaq 1.6%.

U.S. stock futures were flat Wednesday night ahead of June’s jobs report, after the S&P 500 and Nasdaq closed at record highs while the Dow dipped slightly. Markets balanced optimism over a new U.S.-Vietnam trade deal—imposing a 20% tariff on Vietnamese imports and 40% on goods transshipped via Vietnam—against weak ADP data showing a 33,000 drop in private payrolls. Economists expect 110,000 June job gains and a 4.3% unemployment rate. A soft report could prompt a rotation out of tech into value, but also increase odds of an earlier Fed rate cut. Traders also watched progress on Trump’s tax megabill, which passed the Senate and returned to the House. Thursday will be a shortened trading day; markets are closed Friday. Elsewhere, short interest in the S&P 500 and Nasdaq-100 has risen this year despite the rebound, Tripadvisor jumped on reports of a Starboard stake, and Datadog surged after being added to the S&P 500.

- Markets: S&P 500 and Nasdaq closed at records; banks rallied with Morgan Stanley, JPMorgan, and Wells Fargo hitting new highs after dividend hikes and positive Fed stress-test results. Bank ETF KBE up ~10% in a month but still below November high. - Big tech: Amazon up >25% since Andy Jassy became CEO in 2021, lagging broader tech. Apple gained 2.2% after a Jefferies upgrade and bullish technician calls but remains down 15% YTD and 18% below its December peak. - Trade watch: Potential U.S.–Vietnam deal flagged by former President Trump would impose a 20% tariff on Vietnamese imports and a 40% transshipping levy; details pending from the White House. Apparel/footwear brands with Vietnam exposure saw mixed moves but remain mostly well below highs (e.g., Deckers, Lululemon, Under Armour, VF Corp). - Luxury: UBS shifted to neutral; U.S.-traded Burberry, LVMH, and Kering rallied sharply over the past week, though still below prior peaks. - Index changes: Datadog to join S&P 500 on July 9, replacing Juniper Networks; DDOG jumped ~10% after-hours and is up ~50% in three months, still ~18% below December high. - EVs: Tesla rebounded ~5% after deliveries, though still 35% off December high; Rivian fell 4.5%, down 31% from last July’s high. - Intel: Ongoing turnaround coverage; shares up ~11% in a month but still 41% below July 2024 high. - Joby Aviation: CEO to appear on CNBC; stock up ~20% in a week, though FAA certification and commercial flights remain distant.