The session concluded with the Dow Jones Industrial Average index falling by 0.14%, in contrast to other major indexes that set new records at the close.
The Nasdaq index saw an increase of 0.33%, while the S&P500 rose by 0.02%.
Angelo Kourkafas, an analyst at Edward Jones, described the response as “a more moderate than muted reaction” to the announcement of the agreement between the US and the EU, in statements to AFP.
In his view, it was the reception of “a good anticipated news,” which “had largely been anticipated by investors on Friday.”
On Sunday in Scotland, Donald Trump and Ursula von der Leyen presented the details of the customs agreement, which includes a 15% tariff on European exports to the US.
In addition to the committed tariffs, the EU will also purchase energy worth $750 billion and invest $600 billion in the US.
The full details of the agreement are expected to be revealed in the coming days.
This agreement is in addition to previously known ones, particularly with the United Kingdom and Japan.
According to Kourkafas, “it’s formidable that the announcement of these agreements reduces uncertainty” on the trade front, just days away from the deadline (August 1), after which heightened tariffs on US imports will be applied.
“But at the same time (…) there are numerous potential catalysts for volatility, which explains why investors are more cautious as the busiest week of the summer for the markets approaches,” he elaborated.
Regarding indicators, the US employment report is set to be released on Tuesday, a preliminary estimate of the US GDP for the second quarter on Wednesday, and the PCE index, which the Federal Reserve (Fed) uses to assess price changes, on Thursday.
Also on Wednesday, investors will focus on the conclusion of the Fed’s monetary policy committee, expecting the announcement of the decision to maintain the reference interest rate within the range of 4.25% and 4.50%.
Today’s cautious day may also be attributed to the “need for a consolidation period after a series of upward sessions,” as Angelo Kourkafas pointed out. He emphasized: “Let’s not forget that markets do not move in a straight line.”
