Global stock markets cautiously navigate amidst Trump's fresh round of tariffs on Wall Street
In the world of finance, a mix of positive and negative developments have kept investors on their toes this week.
Duolingo, the popular language-learning app, saw a 13.7% increase in its stock price, marking a significant growth in its subscription revenue which grew by 46% compared to the same period last year. However, not all tech stocks have fared as well. Eli Lilly dropped 14.1% due to disappointing results for a late-stage study of its potential pill version of the popular weight-loss drug Zepbound.
Apple's stock climbed 3.2% after CEO Tim Cook announced an additional $100 billion investment in U.S. manufacturing over the next four years. Meanwhile, the Dow Jones Industrial Average dipped 224.48 points to 43,968.64, while the Nasdaq composite rose 0.3% to a record on Thursday. The Standard & Poor's 500 index slipped 0.1% on the same day.
The global markets have been affected by ongoing concerns about tariffs, with the Trump administration's newest and most sweeping tariffs taking effect on August 7, 2025. These tariffs, which range from 10% to as high as 50% on India and up to 41% on Syria, target products from 66 countries, the European Union, Taiwan, and the Falkland Islands. The tariffs increase the average U.S. price level by about 1.8% in the short run, leading to estimated household income losses of roughly $2,400 annually due to higher prices.
Despite these concerns, the S&P 500 edged down by 5.06 points to 6,340.00, a relatively small decrease considering the tariff-related uncertainties. Japan's Nikkei 225 rose 0.6%, and stocks in Shanghai climbed 0.2% and in Hong Kong rose 0.7%.
The Bank of England cut its main interest rate on Thursday, a move aimed at boosting the British economy amidst Brexit-related uncertainties. Productivity for U.S. workers improved by more than expected during the spring, which could help the U.S. economy grow without adding more pressure on inflation.
However, worries about Trump's tariffs damaging the economy are high, particularly after a worse-than-expected job market report last week. The tariffs are expected to have a significant impact on certain industries, such as clothing and textiles, with shoe prices rising 39% and apparel prices 37% in the short term. Companies like Crocs have already felt the brunt of these tariffs, with its stock tumbling 29.2% due to concerns about tariffs and continued uncertainty from evolving global trade policy.
Toyota Motor's stock fell due to reduced full-year earnings forecasts because of Trump's tariffs. Sony, on the other hand, rose after indicating it's taking less damage from the tariffs than expected.
In international trade news, China's exports picked up in July, helped by a flurry of shipments taking advantage of a pause in Trump's tariff war with Beijing. U.S. tariffs on dozens of countries had only a muted effect on markets worldwide on Thursday.
The yield on the 10-year Treasury rose to 4.23% from 4.22%, a slight increase in the bond market.
In summary, while the global markets have shown resilience in the face of tariff concerns and central bank decisions, certain sectors are feeling the impact more than others. The ongoing trade tensions and their economic implications continue to be a significant factor in global financial markets.
- Duolingo's significant growth in subscription revenue, leading to a 13.7% increase in its stock price, indicates a positive development in the entertainment and technology sectors of the economy.
- The Dow Jones Industrial Average and the S&P 500 index experienced a minor decrease, while the Nasdaq composite rose to a record, reflecting conflicting sentiments among investors in the stock market.
- The Bank of England's decision to cut its main interest rate to boost the British economy is a move closely watched by investors in the finance and general-news sectors.
- Worries about Trump's tariffs causing damage to certain industries, such as clothing and textiles, have led to concerns for companies like Crocs, affecting their stock prices and the overall economy.
- Ongoing trade tensions between the U.S. and various countries, particularly China, continue to have a significant impact on international trade and global financial markets.
