📉 Markets are turning upwards: investors are betting on Fed rate cuts

After the worst day since May, S&P 500 futures +0.6%, and Stoxx 600 +0.5% — markets revived amid hopes that the Fed will cut rates in September. The reason is a weak labor market report in the US on Friday, which intensified expectations of a monetary turnaround.

💡 Key point:
• S&P 500 bounced back after the largest drop in three months
• Market expectation: >80% chance of a rate cut in September
• Swaps already reflect a 57 bps easing by the end of the year
• 10-year US bonds: yield rose to 4.25%, but still lower than it was before Friday

💬 "We are buying on dips. A rate cut is a matter of time. Friday could have been the bottom," — Morgan Stanley

🏛️ Politics and the Fed:
• Trump fired the chief labor statistician due to "weak numbers"
• Announced new appointments at the Fed and the Department of Labor — a course towards a more accommodative monetary policy
• Adriana Kugler is leaving the Fed — another chance for Trump to influence the board composition

🇨🇳 Trade:
• US-China: gradual improvement in relations, dialogue on rare earth metals
• Trump promotes the idea of "fairer trade", rhetoric is softer than in June

💼 Corporate news:
• Lloyds +7% — won the auto loan case in the UK
• UBS -2% — $300 million fine in the US due to mortgage case
• BYD is falling — slowdown in electric vehicle sales
• Hong Kong simplifies IPO rules — a new boost for one of the hottest markets this year

📉 Switzerland in the red — the market opened after the holidays and immediately faced a hit from 39% Trump tariffs + pressure on pharma companies regarding price cuts

📊 Conclusions:
✅ Investors have shifted focus from inflation to soft macro data
✅ Market expectations: not just one, but two rate cuts by the end of the year
✅ Political pressure on the Fed is increasing — independence level in question
✅ If the next labor report is weak again — a September rate cut is almost guaranteed.