Trump Escalates Trade War with 50% Copper Tariff, Eyes Semiconductors and Pharma Next

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Global Sentiment: Risk-off
Factors: Trump Tariff

TODAY’S WATCHLIST
- US FOMC Meeting Minute
- AMFI June Data

THE BIG STORY
US President Donald Trump on Tuesday announced plans to impose a sweeping 50% tariff on imported copper, signalling a major escalation in his global trade agenda. The surprise move, which came earlier than expected and at a steeper rate than anticipated, sent US Comex copper futures soaring over 12% to a record high above $5.8 per pound, before settling around $5.5. The White House says the measure is aimed at boosting domestic production and cutting reliance on imports — particularly from top supplier Chile bringing copper in line with existing 50% tariffs on steel and aluminium. Commerce Secretary Howard Lutnick confirmed that a formal proclamation will be signed by the end of July, while Treasury Secretary Scott Bessent projected annual tariff revenues could hit $300 billion, nearly four times current levels.

The announcement came alongside Trump's warning that long-threatened levies on semiconductors and pharmaceuticals are also on the horizon, a shift that could intensify market volatility and global supply chain concerns. Meanwhile, Trump said the US was “close” to sealing a trade deal with India, though he offered no timeline or details. As traders brace for further shocks, Washington’s tariff-first strategy continues to reshape commodity markets and deepen international trade tensions.

DATA
US small-business confidence edged lower in June, with firms reporting concerns about excess inventory and weakening sales prospects amid persistent trade tensions. The National Federation of Independent Business said its Small Business Optimism Index dipped to 98.6, down 0.2 points from May. The decline was driven largely by a jump in the number of businesses saying their inventories were too high nearly one in eight, almost double the figure from the previous month.
In a further sign of supply-demand imbalances, US crude oil inventories surged by 7.1 million barrels in the week ending 4 July, marking the largest build since February. The increase caught markets off guard, as analysts had forecast a 2.8-million-barrel draw. It also followed a 680,000-barrel rise the previous week, indicating a shift in oil market dynamics after five consecutive weeks of inventory declines. 

WHAT HAPPENED OVERNIGHT
US stocks ended slightly lower in a volatile session on Tuesday as investors weighed President Trump’s latest tariff threats and awaited clarity on US trade policy. Markets were calmer than Monday’s sharp selloff, but the S&P 500 and Nasdaq fluctuated between gains and losses throughout the day, reflecting uncertainty over potential trade negotiations. Tesla rebounded 1.3% after a steep drop the previous session, while Freeport-McMoRan rose 2.5% on optimism around tariffs boosting domestic copper producers. Moderna surged 8.8%, leading S&P 500 gainers, after major medical groups filed a lawsuit challenging US vaccine policy under Health Secretary Robert F. Kennedy Jr.

US Treasury yields climbed on Tuesday, with the benchmark 10-year yield rising nearly its highest level since mid-June, as investors digested President Trump’s updated tariff timeline, which offers a brief negotiation window before the August 1st deadline. The 10-year note’s yield earlier touched 4.435% before settling at 4.417%, up 2.2 basis points. A $58 billion auction of 3-year notes saw soft demand, pricing at 3.891% about half a basis point above market levels with a below-average bid-to-cover ratio of 2.51.

The US dollar index rose to 97.7 on Tuesday, continuing its recovery from the more-than-three-year low of 96.8 hit on July 2, as markets weighed the potential impact of President Trump's latest tariff measures on capital flows and policy outlook. The dollar strengthened 0.38% to 146.625 against the yen, which weakened after Trump reaffirmed plans to slap 25% tariffs on Japanese and South Korean goods. Meanwhile, the euro edged up 0.17% to $1.1729 against the greenback.

Brent crude oil prices rose to a two-week high on Tuesday, supported by forecasts of lower US production, fresh Houthi attacks on Red Sea shipping routes, and concerns over potential US tariffs on copper that may signal broader trade tensions. Brent crude settled 0.8% higher at $70.15 a barrel, while US West Texas Intermediate gained 0.6% to close at $68.33. Technical short covering also contributed to the upward momentum in crude markets.

Day’s Ledger

Economic Data:

• China June CPI Data
• US Crude Oil Inventories Data
• US Cushing Crude Oil Inventories
• AMFI June Data

Corporate Actions:

• Apr-Jun earnings: Supreme Infrastructure, Bodhtree Consulting, Atishay, Jattashankar Industries, Gujarat Hotels, GACM Technologies
• Devinsu Trading to consider fund raising 
• Elitecon International to consider fund raising 
• Muthoot Capital to consider NCDs issue
• Teamo Productions to consider fund raising 
• Titagarh Rail to consider fund raising 
• Valiant Laboratories to consider fund raising

Policy Events 

• Australia RBA Hunter Speech
• ECB Lane Speech  
• ECB Guindos Speech 
• RBNZ Interest Rate Decision
• BoE Financial Stability Report  
• German Buba President Nagel Speaks  
• US FOMC Meeting Minute

TICKERS

• CCI approved 360 ONE’s acquisition of UBS India’s PMS, broking, and lending arms; includes 4.95% equity via warrant, strengthening wealth partnership announced in April.
• CEAT to invest ₹35.5 mln in Tyresnmore via rights issue to fund doorstep tyre and battery fitment services, boosting subsidiary’s operations and reach.
• DALMIA BHARAT got NSE, BSE nod to reclassify RHI Magnesita and Dalmia GSB from promoter to public; both held zero stake as of Mar. 31.
• GUJARAT PIPAVAV’s June quarter cargo volumes steady; liquid cargo rose 21% YoY, dry bulk up 20% QoQ, container volumes dipped slightly; rail throughput fell marginally.
• HCL TECH partnered with Workday to deliver AI-led HR, finance, and planning solutions, integrating HCL’s gen AI platform with Workday’s cloud-based enterprise software.
• JSW STEEL’s June quarter crude steel output rose 14% YoY to 7.26 mln tn; Indian output grew 15%; Q-o-Q fall due to furnace shutdowns.
• MCX to launch electricity futures Thursday; SEBI-approved contracts aim to offer hedging tools for power sector with limits, margins, and tick-size rules.
• NBCC received RBI approval to invest in UAE-based NBCC Overseas Real Estate; remitted AED 1 million as equity for the real estate arm.
• OLA ELECTRIC launched MoveOS 5 OTA update with smart energy tools, SOS, custom ride settings; aims to boost scooter performance, safety, and personalisation.
• Railtel received ₹969.9 mln order from CWC for smart warehousing across 226 sites, including supply, testing, commissioning, and full O&M of tech systems.
• SUPREME INDUSTRIES bagged ₹540 mln order from BPCL to supply 200,000 LPG cylinders over six months; delivery under letter of acceptance issued Tuesday.
• TATA MOTORS Q1 global wholesale sales fell 9% YoY to 299,664 units; both passenger and commercial segments saw drop; JLR volumes down 11%.
• TATA STEEL’s India deliveries fell 4% YoY; Q-o-Q drop was sharper due to shutdowns; Thai volumes rose, UK declined; hi-end offerings grew 4%.
• UNION BANK’s domestic loans rose 6.8% YoY but fell Q-o-Q; retail loans strong at 26% YoY; deposits shrank Q-o-Q, CASA dipped sequentially.

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