U.S. Dollar Eases as Tariff Deadline Looms

By Dow Jones Newswires Staff

U.S. stocks closed at fresh record highs Thursday after U.S. payrolls rose more than expected. Meanwhile, President Trump is set to use the Independence Day holiday as the backdrop to signing his big tax and spending bill which passed through the House. Investors' attention has now turned to concerns about the U.S. 's ballooning fiscal deficit, and the end of a 90-day pause on so-called U.S. reciprocal tariffs due to end on July 9. Ahead of that, countries are racing to agree trade deals with the Trump administration.

• U.S. bond and stock markets are closed Friday for the holiday, but the dollar and bitcoin eased, while stock markets in Asia ended narrowly mixed and were lower at the open in Europe.
• The dollar retraced gains driven by Thursday's better-than-expected nonfarm payrolls data as concerns over U.S. trade weigh. Trump said he would start sending letters to trading partners from Friday, laying out the details of new tariffs. The DXY dollar index against a basket of major currencies was down 0.3% to 96.862, having hit a one-week high of 97.422 Thursday. Bitcoin fell 0.9% to $109,008 after reaching a five-week high of $110,585 Thursday, according to LSEG data.
• The 10-year U.S. Treasury yield is expected to stay in the 4.0%-4.5% range in the coming months, Societe Generale's rates strategists said. They said they expect the Federal Reserve to cut rates twice in the second half to counter the slowdown in growth and employment. The 10-year Treasury yield closed at 4.346% on Thursday, according to LSEG.
• European stock markets fell in early trade with Spain's IBEX 35 off over 1.0%, France's CAC 40 down 0.7% and Germany's DAX off 0.6%. The broad Stoxx Europe 600 fell 0.5%. European airlines shares fell on the second day of a strike of France's air-traffic controllers, which is forcing carriers to cancel hundreds of flights. Wizz Air fell 1.4%, easyJet was down 0.8% and Ryanair and TUI fell. The U.K.'s FTSE 100 was down 0.3%.
• There was a mixed picture at the close in Asia. Japan's Nikkei 225 index gained 0.1%, China's benchmark Shanghai Composite gained 0.3% but the ChiNext index and Shenzhen Composite both fell. Hong Kong's Hang Seng closed down 0.7% and South Korea's Kospi fell 2.0%.
• China's commerce ministry said earlier it is reviewing and approving qualified applications for exports of controlled items to the U.S., underscoring the race to secure trade deals ahead of July 9. Still, the threat to global growth from U.S. tariffs policy remains high, said Shane Oliver, chief economist at AMP. A 20% average U.S. tariff rate is well down on the 30% that would have applied post "Liberation Day," but it is well up on the 3% average U.S. tariff rate at the start of the year, he said.
• Oil prices ticked lower as investors braced for OPEC+'s meeting this weekend, with expectations for another large output hike already factored in. Brent crude slipped 0.2% to $68.68 a barrel.

Write to Barcelona Editors at barcelonaeditors@dowjones.com