Trump’s EU Deal: Impacts on U.S. Markets and Future Earnings

Let's get to the big story breakdown.

US stock futures getting a bump ahead of the market open on this Monday morning.

Now Trump making a deal with the EU president during his trip in Scotland.

The EU is agreeing to a 15% baseline tariff along with investments in the US.

Now looking ahead, the week is jam packed with market moving events, earnings from S&P giants as well as the Fed's July meeting and the jobs report.

Joining me as we kick off the trading week is Peter Tuchman, senior floor trader at Trademoss.

Peter, good morning.

Happy Monday to you.

I hope you had a great weekend.

We are looking at futures higher yet again, so how much higher can the markets actually go?

You know what, look, look, I'm not here to predict where the market's going to go, but just analyzing what we have in the pipeline, right?

So the market can keep going, right?

I mean, if I've learned anything over the last couple or 5 years is that never underestimate the downside potential and the upside potential, right?

I know a lot of people, you know, it's like.

One of the things we teach at Wall Street Global Trading Academy is never think that this can, this stock can't go any higher, right?

A lot of people who sort of feel like when the market's trading flatlining off the top for a long period of time, it's got to go down.

It's got to pull back, right?

But it doesn't, right?

We've seen a lot of people on the short side have gotten squeezed out by that kind of a mentality.

The market has a lot of room left to go.

Why is that the case?

Because we have earnings that are coming in solid now.

What what we what we didn't have last quarter was the inability for guidance, right?

This while we had good earnings, so that kind of muddled everything.

Now we're having good earnings coming out of the gate.

The banks were good, stress tests was good, and we're able to give some guidance.

So that's giving it a little bit of a boost.

These deals that while we were focused on what was happening geopolitically in the Middle East, there was a lot of backdoor to backroom diplomacy going on.

The EU deal is a big deal.

They were the she was the first person who really met Trump, right?

You know, I, we mentioned this before.

Everyone else, when he mentioned tariffs for the country, they sort of they had a bully bully relationship.

She was the first person who called him and said we want to make a deal.

We need a little more time.

Give us that time and we will sign something, and he respected that that they met at this on his turf and she's getting the deal that she wanted.

I mean 15% is, I would think is, you know, we're hoping for 10% across the board, but 15% is going to be the upside range, and that's a good thing.

So you've got a little money in the sidelines, $7 trillion being, you know.

Catch up.

So there's a lot of if you notice the way the market's trading, I think there's a lot of conviction buying going on.

So those are people who are taking advantage of the pullbacks and then buying the market because we're seeing a lot of intraday reversals and nice trends.

And so then you have the Fed meeting, right?

I mean we know we had that wonderful little episode last week with with Mr.

Trump and and Jay Powell, and I think he pushed back in the most respectful way possible because the numbers were not right.

That building was built 5 years ago, so whatever, but um.

You know, maybe we will cut some rates.

Yeah, and speaking of turf, we're talking about Trump being at the Federal Reservo, something that we haven't seen with a president in many, many years.

But as we look ahead to this week, as you mentioned, we get earnings reports as well as the Fed meeting and at the end of the week we get the July jobs report, not to mention the PC which we know the Fed is also watching.

So what are you paying attention to?

What really matters here?

You know what I think all of the above, right?

I think all The above.

I think the most important thing is Mr.

Trump said last week that hopefully by August 1st all the deals will be done, whether they're done in person, whether they're done in letter or whether they're done just basically in negotiation, and then they've got to really the specifics have got to be done.

Market is being led a lot by tech, right?

We know that, you know, we had also last week that meeting with with Jensen and with the president talking about all that cap expenditure, trillions of dollars going into Nvidia, Nvidia sort of.

The president allowing that deal that he had outlawed back a couple of months ago with Nvidia selling things to China.

That deal's open.

So you know, all these things that were sort of looming events that were really causing a lot of stress on the market are now the boxes are being checked off and in a positive way.

So if all of that gets done, all of these things that we've been wondering about and anxious about actually get done, well, I think that the market has a lot of potential upside.

Yes, and finally, I do want to ask you about levels, especially for the S&P 500 as we continue to see all-time record highs and closing highs as well.

So here we are right below 6400 as of last Friday.

We're seeing price targets being raised to 7000 and even this morning Morgan Stanley coming out and saying their target is 7200 for next year.

So what are you watching this year and in the near term?

So you know what, look, I'm surely we close right below 45.

1000 on the Dow, you know, obviously the Nasdaq has been on fire, but you know I even mentioned it here on the show a couple of weeks ago and I had had a chat with Dan Es who said that he's really his predictions are great and I know we're going to get him on the show really soon, but he said that there's going to be a 7 in front of that S&P and so whether 7200 or 7000, you know that means that there's a lot of room for growth, that the market has a lot of bread on the upside, you know, that, you know, look.

Obviously things, you know, we're one tweet away from crazy towns.

Anything can happen here.

But you know what, at the end of the day I think 7000 on the S&P by year end or sooner is a possibility.

Yeah, Peter, we'll continue to eye those levels and if last August was any indicator, we can take a break for a summer.

So I look forward to speaking with you remember last August crash, we were here for it, but let's hope it doesn't happen this time.

We'll have you back bright and early on Jobs Day Friday.

Thank you so much, Peter.

Happy trading.