To The Moon

Performance of Global Equity Indices(in US Dollar)

Source: Bloomberg, Tiger Brokers

• Last week, as geopolitical tensions in the Middle East eased, global capital markets rallied across the board. In the U.S., both the S&P 500 and Nasdaq 100 broke record highs, with the AI-led tech sector once again emerging as the market’s primary driver. At the same time, developed and emerging markets alike posted strong performances—Japan’s Nikkei, Hong Kong’s Hang Seng Index, and major European indices all gained more than 3% over the week. In comparison, China’s onshore markets, including the Shanghai Composite and the CSI 300, lagged slightly but still posted solid gains of over 2%.

• Federal Reserve Chair Jerome Powell testified before Congress last week, maintaining a cautious stance but notably refrained from ruling out the possibility of a rate cut in July. This was widely interpreted by markets as a dovish signal. Meanwhile, U.S. May PCE data came in slightly below expectations. Notably, durable goods inflation turned positive year-on-year for the first time in two years, while both personal income and spending grew far less than expected. In our view, the pressure from tariffs won’t disappear on its own—it will eventually be reflected either in consumer prices or in corporate profit margins. It's only a matter of time. The next two weeks will be critical, both on the policy front and in terms of macroeconomic data.

• Key events to watch this week include June ISM Manufacturing and Services PMIs, June Nonfarm Payrolls and Unemployment Rate.

Key Market Themes

U.S. Equities: Strong Sentiment, Cautious Outlook

• Over the past week, as geopolitical tensions eased, U.S. equities broke out of their recent trading range. Both the S&P 500 and Nasdaq reached new all-time highs, with weekly charts printing strong bullish candles. On the macro front, Federal Reserve Chair Jerome Powell testified before Congress. As expected, he reiterated the Fed’s stance of “not in a hurry, wait and see.” However, when asked directly whether a rate cut could happen in July, he did not rule it out. Instead, he offered a more measured response: “Many paths are possible.” He also stated that if the impact of tariffs on consumer prices is lower than expected, it could have a material effect on monetary policy. At this point, the Fed’s stance is fairly transparent—everything hinges on inflation and labor data from June, July, and August. If the data shows limited impact from tariffs, rate cuts may accelerate. Conversely, if inflation proves sticky, the Fed might not cut at all this year. We currently lean toward Powell’s view: with a 10% tariff baseline, either producers or consumers will bear the cost. It's only a matter of time before we see the impact in CPI or PPI.

• Meanwhile, the May PCE report brought a mild surprise. The Fed’s preferred gauge, core PCE, rose 0.18% MoM and 2.67% YoY—slightly above market expectations. Notably, the goods component showed renewed upward pressure. Durable goods prices increased 0.45% YoY, marking the first positive reading since June 2023. On the other hand, personal income and spending declined by 0.4% and 0.1% MoM, respectively—both well below expectations. While the drop in spending might be attributed to pre-tariff front-loading, the decline in income is more concerning. It raises questions about whether wage growth and the labor market are beginning to soften—something that this week’s nonfarm payrolls data will help clarify. That said, the market remains highly optimistic. Minor macro disappointments have only triggered intraday volatility, without altering the broader upward trend.

Source: U.S. Bureau of Economic Analysis, Bloomberg

• Last week, there were a few unexpected developments on the tariff front. The good news: concrete progress was finally made on U.S.-China trade measures, and this time it was officially confirmed by both sides. According to the U.S. announcement, China will ease its restrictions on rare earth exports, while the U.S. will gradually lift controls on Chinese imports of ethane, semiconductor software, and aircraft engines. The bad news: U.S.-Canada trade talks temporarily collapsed. The breakdown was triggered by Canada’s insistence on imposing a digital services tax, which prompted Trump to immediately suspend all negotiations. However, Canada has since backed down and agreed to withdraw the tax, leading Trump to resume talks.

• Beyond tariffs, Trump’s flagship "Big & Beautiful Act" also made headway last week. First, the controversial Section 899 was removed to appease the EU and other allies, in exchange for their agreement to eliminate digital service taxes on American firms. Second, on June 29th, the Senate narrowly passed a procedural vote (51:49), allowing the bill to move into its final debate stage. Given this razor-thin margin, Republicans will need near-total unity to push the bill through the Senate by July 4th. Unsurprisingly, Trump has taken to social media—alternately rallying and pressuring his party to fall in line.

• It’s now been nearly six months since the Trump administration fully took office. Over this period, markets have once again been reminded of what it means to trade under a "Trump-driven" narrative. Comparing the current state to Trump’s initial plans, there have been several notable shifts. First, Elon Musk’s much-hyped DOGE initiative appears to have stalled—a far cry from the earlier promise of deep spending cuts. Instead, Trump is now doubling down on aggressive fiscal expansion with the Big & Beautiful Act. Second, while tariffs remain in place, market sentiment has clearly evolved. The panic that gripped investors in April has largely dissipated. Markets now seem convinced of the "TACO" pattern—Trump Always Chickens Out—and are pricing in more bark than bite. From a numbers perspective, the policy effects are also taking shape: U.S. tariff revenues in April and May surged nearly threefold, and the goods trade deficit narrowed meaningfully compared to Q1, even dipping below the final year of the Biden administration.

Source: U.S. Census Bureau

• Looking into the second half of the year, if macroeconomic data remains stable and avoids any significant deterioration, we may see the emergence of a dual easing environment—both fiscal and monetary. In the short term, however, the next two weeks will be a critical window. While markets have almost fully priced in a delay to the tariff negotiations, any surprise at this stage could deal a significant blow to sentiment. Additionally, this week's June nonfarm payrolls report, along with the upcoming June CPI data, will play a pivotal role in shaping policy direction and market trends for the remainder of the year. At this moment, we remain optimistic—but also highly vigilant.

Disclaimer

本研究報告由老虎資產管理團隊“老虎資管”發佈，老虎資管包括老虎資產管理團隊（香港）和老虎基金管理公司（新加坡）。對某些司法管轄區或國家而言，撰寫、分發或使用本材料可能會牴觸當地法律、法則或規定，或其它註冊或發牌的規例。本材料不是旨在向上述司法管轄區或國家的任何人或實體分發或由其使用。

老虎資產管理團隊（香港）

本研究報告由老虎資管（香港）發佈，老虎資管（香港）是⾹港證監會持牌法團⽼⻁證券（⾹港）環球有限公司（“⽼⻁證券“）（中央編號：BMU940）的資產管理部門。

本報告所包含的資料均爲⽼⻁證券從據信爲準確的來源編制，惟本公司並不就此等內容之準確性、完整性及正確性作出明示或暗示之保證。本報告內之所有意見均可在不作另⾏通知之下作出更改。⽼⻁證券對有關報告所引致之任何損失或虧損概不負責。 本報告所載的數據只供參考⽤途，並沒有法律約束⼒，亦不構成投資建議、邀約、購⼊、出售任何產品。

投資涉及風險，有可能損失投資本⾦。你應諮詢專業⼈⼠，就本⾝的投資經驗、財務狀況、個⼈⽬標及風險取向，以提供投資意見。各類產品的風險，請參閱本公司網頁客戶協議第四部分風險披露聲明。

以上資料爲老虎證券擁有並受版權及知識產權法保護。除非事先得到老虎證券明確書面批准，否則不應複製、散播或發佈。撰寫研究報告內的分析員（“此等⼈⼠“）均爲根據證券及期貨條例註冊的持牌⼈⼠，此等⼈⼠保證，文中觀點均爲其對有關報告提及的個別市況及／或行業及／或投資產品之一般及實際因素的觀點。截⾄本報告發表當⽇，此等⼈⼠均未於本報告中所推介的股份存有權益。

投資產品面臨一定的風險，包括但不限於利率、信貸、行業前景和監管要求。投資者在做出投資決定前, 應詳細閱讀相關發行文件並諮詢專業投資顧問。本資料僅供香港投資者參考, 不應視爲投資建議。

老虎基金管理公司（新加坡）

Tiger Fund Management（ Singapore ）

Tiger Fund Management Pte. Ltd. (UEN: 202223754K) ("TFM") is a holder of Capital Markets Services License (License No. CMS101343) issued by the Monetary Authority of Singapore for fund management.

The information in this publication is for information only. The information and opinions contained in this publication has been obtained from sources believed to be reliable, but TFM makes no representation or warranty as to its adequacy, completeness, accuracy or timeliness for any particular purpose. Opinions and estimates are subject to change without notice.

Where specific products are advertised and/or recommended, please note the following: (i) The recommendation is intended for general circulation; (ii) The recommendation does not take into account the specific investment objectives, financial situation or particular needs of any particular person; (iii) Advice should be sought from a financial adviser regarding the suitability of the investment product, taking into account the specific investment objectives, financial situation or particular needs of any person in receipt of the recommendation, before the person makes a commitment to purchase the investment product. Should the person choose not to do so, he should consider carefully whether the product is suitable for him. In particular, all relevant documentations pertaining to the product should be read to make an independent assessment of the appropriateness of the transaction. (iv) This advertisement has not been reviewed by the Monetary Authority of Singapore, or any regulatory authority elsewhere.

TFM, its related companies, their directors and/ or employees may have positions or other interests in, and may effect transactions in the product(s) mentioned here. TFM may have alliances or other contractual agreements with the provider(s) of the product(s) to market or sell its product(s). Where TFM’s related company is the product provider, such related company may be receiving fees from investors. In addition, TFM, their directors and/ or employees may also perform or seek to perform broking or financial services for these product providers.

Any past performance, projection, forecast or simulation of results is not necessarily indicative of the future or likely performance of any investment. There is no assurance that the credit ratings of any securities mentioned in this publication will remain in effect for any given period of time or that such ratings will not be revised, suspended or withdrawn in the future if, in the relevant credit rating agency’s judgment, the circumstances so warrant. The value of any product and any income accruing to such product may rise as well as fall. Foreign exchange transactions involve risks. The reader should note that fluctuations in foreign exchange rates may result in losses in foreign exchange.

To the extent permitted by law, TFM accepts no liability whatsoever for any direct indirect or consequential losses or damages arising from or in connection with the use or reliance of this publication or its contents. This publication is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation.