Global Markets React to US-Vietnam Trade Deal

US stock futures were little changed on Wednesday night as traders awaited the June nonfarm payrolls report. The S&P 500 rose 0.47% to a record close earlier in the day, while the Nasdaq Composite rallied 0.94% to a record close. The moves followed a reported trade deal between the US and Vietnam. Economists expect the economy added 110,000 jobs in June, and a disappointing report could lead to a rotation out of tech stocks and potentially a rate cut by the Federal Reserve. Short interest in the S&P 500 and Nasdaq-100 has risen steadily this year, according to S3 Partners. The NYSE and Nasdaq will close at 1 p.m. ET on Thursday, and US markets are closed on Friday for Independence Day.

Asian stock markets were mixed on Thursday, with Vietnam's benchmark index rising 0.3% to its highest in over three years following a reported US-Vietnam trade deal. The deal includes a 20% US tariff on Vietnamese imports and "zero tariff" for US goods entering Vietnam. Japan's Nikkei 225 slipped 0.15%, while South Korea's Kospi added 0.77%. Australia's S&P/ASX 200 rose 0.13%. Hong Kong's Hang Seng index fell 0.64%, and mainland China's CSI 300 gained 0.14%. Taiwan's stocks jumped 1.1% to their highest since March, led by technology and consumer cyclicals stocks. US stock futures were little changed ahead of the June jobs report.

The US economy lost 33,000 private sector jobs in June, surprising economists who had expected a gain of 100,000 jobs. However, the news was overshadowed by a trade deal between the US and Vietnam, which will reduce tariffs on Vietnamese imports from 46% to 20%. The S&P 500 rose to a new closing high, as investors focused on the potential benefits of the trade deal, such as lower costs for companies like Nike. Tesla's shares also rose despite a 14% drop in second-quarter deliveries. A weak jobs report could potentially trigger a sell-off if the official nonfarm payrolls data due Thursday is similarly disappointing.

European markets are expected to open higher on Thursday, with the FTSE 100 projected to rise 0.3%, DAX up 0.2%, and CAC 40 also up 0.2%. The positive start follows a mixed day on Wednesday, particularly in the UK where bond prices and the FTSE tumbled after questions were raised about the UK Finance Minister's position. The US lifted restrictions on chip design software sales in China as part of a trade truce, and US nonfarm payrolls data is awaited later in the day, with economists expecting 110,000 jobs added in June.

The S&P 500 and Nasdaq Composite reached record closing highs, driven by gains in tech stocks. Amazon's CEO Andy Jassy is marking four years at the helm, during which the stock has risen over 25%. Apple was a top searched stock on CNBC.com, with analysts giving mixed views on its prospects. A potential trade deal between the US and Vietnam could impact companies like Columbia Sportswear, Crocs, and Nike. Banks like Morgan Stanley, JPMorgan, and Wells Fargo have seen significant gains in recent days after several big banks hiked their dividends. Luxury stocks were upgraded by UBS, with Burberry, LVMH, and Kering seeing gains. Other stocks to watch include Joby Aviation, Datadog, which is set to join the S&P 500, Intel, and EV makers Tesla and Rivian, which released sales numbers on Wednesday.

The US economy and trade news includes several key updates: Chinese firms in Vietnam are optimistic about a US tariff deal, with the US agreeing to lower tariffs on Vietnamese goods to 20%. The US Senate has passed a bill barring energy tax credits for China-linked firms. The EU is reportedly willing to back down on trade alongside Canada amid US strong-arm tactics. Some Chinese retailers still see the US as a profitable market despite bilateral tensions. Canada's tough stance towards the US and China may backfire. The US and China have reached an agreement on export controls. The White House announced an "understanding" with China on rare earth shipments. US companies, including GM, Tesla, and Ford, have significant exposure to China. Nvidia has become the world's largest stock again. US tariffs are chilling investment, leaders warn. China's yuan may benefit as central banks report doubts about the US dollar. China's shipments of hi-tech goods to the EU have surged as its exports to the US plunge.

President Trump announced that the US has reached a trade deal with Vietnam, with the US imposing 20% tariffs on Vietnamese goods and 40% on "transshipping", while Vietnam will allow US products to be sold in the country with zero tariffs; Vietnam has not confirmed the deal and details remain unclear, ahead of a July 9 deadline for foreign countries to reach a trade agreement with the US.

Chinese manufacturers in Vietnam are relieved after the US and Vietnam agreed on a trade deal that reduces US tariffs to 20% and eliminates Vietnamese duties on US goods. The deal is seen as "better than expected" and most Chinese exporters plan to continue operating in Vietnam, viewing the final tariff rate as manageable.

The U.S. government has lifted export restrictions on chip-design software to China, according to semiconductor software companies Synopsys and Cadence. The companies, along with Siemens EDA, were previously told to obtain licenses before exporting software to China, but have now been allowed to resume business. Shares of Synopsys and Cadence rose over 6% and 7% respectively in overnight trading after the news, which comes amid reports of progress on a trade truce between the U.S. and China.

The US has lifted export controls on certain chip design software to China, allowing companies like Siemens, Synopsys, and Cadence to resume sales to China without special approval, signaling a further easing of bilateral tensions between the two countries.