Tag Archives: markets

What’s shaping the markets right now: AI hype, Bitcoin’s calm, and the Fed’s next move

What’s shaping the markets right now: AI hype, Bitcoin’s calm, and the Fed’s next move

Global markets are currently riding a wave of optimism, with risk sentiment surging as investors appear to shrug off a host of economic and political uncertainties. This buoyant mood stems mainly from two key drivers: the anticipation of earlier-than-expected Federal Reserve rate cuts and growing excitement about the potential for artificial intelligence to fuel economic growth.

Beneath this surface of confidence, there are substantial risks that could easily unsettle this delicate balance. From escalating trade tensions to shifting monetary policies and fluctuating commodity prices, the global financial landscape is anything but stable. Adding to the complexity is the cryptocurrency market, where Bitcoin’s price volatility has recently hit its lowest point in over a year, offering a curious contrast to the broader market dynamics.

Let’s begin with the economic and political risks that, despite being overlooked by many market participants, remain critical to understanding the current sentiment. One of the most prominent issues is the resurgence of trade tensions, highlighted by former President Donald Trump’s recent threat to raise tariffs on Indian goods substantially. His reasoning ties to India’s continued purchases of Russian oil, a move that has irked US policymakers amid geopolitical strains.

This isn’t just a bilateral spat between the US and India. It has the potential to ripple across global trade networks, disrupting supply chains and increasing costs for businesses worldwide. India plays a vital role in the global economy, particularly in technology and manufacturing, so any escalation in tariffs could dampen corporate earnings and slow economic momentum. This is a reminder that geopolitical posturing can quickly translate into economic consequences, and investors ignoring this risk might find themselves caught off guard if tensions boil over.

Turning to monetary policy, the Federal Reserve’s next moves are shaping up to be a linchpin for market sentiment. San Francisco Fed President Mary Daly recently indicated that the Fed might need to implement more than two rate cuts this year if the labour market weakens further and inflationary pressures from tariffs fail to materialise.

This comment caught my attention because it suggests a willingness to adopt a more supportive stance, which could bolster markets by lowering borrowing costs and encouraging investment. However, it also underscores the Fed’s challenging position. Cutting rates too aggressively risks reigniting inflation, especially if trade disruptions push up prices. On the other hand, holding back could stifle growth if the labor market deteriorates. Fed is walking a tightrope, and its decisions will likely amplify market swings in the coming months. For investors, this means staying attuned to economic data like employment figures and inflation readings, which will heavily influence the Fed’s path.

AI hype changes things

Meanwhile, the optimism around AI-driven growth is injecting a dose of excitement into the markets, and I can see why. Advances in artificial intelligence are no longer just theoretical. They’re starting to reshape industries. Companies are pouring resources into AI, betting that it will streamline operations, boost productivity, and open new revenue channels.

This enthusiasm is most evident in the tech sector, which has powered a recent rebound in US stock markets. The S&P 500 climbed 1.5 per cent, the NASDAQ jumped 2.0 per cent, and the Dow Jones rose 1.3 per cent, reflecting a clear risk-on attitude. I find this rally encouraging because it signals confidence in innovation as a growth driver. I also think it’s worth tempering expectations.

AI’s economic impact is still unfolding, and while the long-term potential is immense, short-term gains might be overstated. If other risks like trade disputes or policy missteps intensify, the AI narrative could lose its luster, leaving tech-heavy indices vulnerable.

The bond market offers another lens into investor sentiment, and here I see a mix of caution and opportunism. US Treasuries consolidated their gains on Monday after a strong showing the previous Friday, when renewed expectations of Fed rate cuts drove demand. The 10-year Treasury yield dropped 2.4 basis points to 4.192 per cent, inching close to its support level at 4.185 per cent.

Lower yields typically suggest investors are seeking safety, which seems at odds with the equity market’s rally. To me, this divergence hints at underlying unease; some investors are hedging their bets even as others pile into stocks. The US Dollar Index fell 0.4 per cent in response to these lower yields, while gold edged up 0.3 per cent to US$3,373 per ounce. Gold’s modest gain reinforces my view that safe-haven assets still hold appeal, despite the risk-on vibe dominating headlines. It’s a subtle but telling sign that not everyone is fully convinced by the current optimism.

The case with commodities

Commodities, too, are part of this intricate puzzle. Brent crude oil slipped 1.3 per cent to US$68 per barrel after OPEC+ agreed to increase production by over 500,000 barrels per day starting in September.

This move surprised me a bit, given the group’s usual caution, but it could ease inflationary pressures by keeping oil prices in check. For consumers and businesses, cheaper oil is a welcome relief, potentially supporting spending and investment. However, it also raises questions about global demand. If OPEC+ feels confident boosting output, does that mean they see economic growth slowing? I lean toward the idea that this is a strategic play to maintain market share, but it’s a development worth watching. Lower oil prices might give central banks like the Fed more room to cut rates without stoking inflation, indirectly supporting the risk sentiment driving markets.

Now, let’s shift gears to Bitcoin, where an intriguing story is unfolding. The cryptocurrency’s price volatility has plummeted to its lowest level in over a year, a stark contrast to its historically wild swings. According to Blockforce Capital, Bitcoin’s annualised 60-day volatility fell to 28.53 per cent on July 30, the lowest since August 28, 2023. Its 30-day volatility hit 25.26 per cent on July 23, the calmest since October 15, 2023. This happened as Bitcoin’s price oscillated between US$105,000 and US$122,750 in July, per Coinbase data from TradingView.

I find this stability fascinating, especially given the broader market turbulence. Part of it stems from regulatory progress, including the passage of three US House bills on crypto and the enactment of regulations in July, with the GENIUS Act signed into law by President Trump. These steps likely reassured investors, reducing uncertainty.

But there’s more to this story. Institutional players are flexing their muscles, and I see this as a game-changer. Strategy, formerly known as MicroStrategy, acquired US$2.46 billion worth of Bitcoin between July 28 and August 3, increasing its holdings to 628,791 tokens, valued at over US$71 billion. That’s a massive bet, averaging $117,526 per token, and it shows how Michael Saylor has turned his company into a Bitcoin juggernaut.

Similarly, Japan’s Metaplanet grabbed 463 BTC for US$53 million, pushing its stash to 17,595 BTC, worth about $2.02 billion. These firms are treating Bitcoin like a treasury asset, buying even as retail enthusiasm wanes. I think this institutional muscle could steady Bitcoin through choppy waters, though it also ties the crypto’s fate closer to corporate strategies.

My view? Enjoy the ride, but keep your eyes wide open. The next few months could be a wild one.

 

Source: https://e27.co/whats-shaping-the-markets-right-now-ai-hype-bitcoins-calm-and-the-feds-next-move-20250805/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

When markets falter: US jobs, Russia, and Bitcoin’s moment to shine

When markets falter: US jobs, Russia, and Bitcoin’s moment to shine

Financial markets around the world have felt the ripple effects, with stock indices tumbling, Treasury yields dropping, and safe-haven assets like gold gaining ground. At the same time, Bitcoin has bucked the broader market trend, posting a modest gain amid a mix of institutional interest and technical factors.

As someone who closely follows economic and market developments, I find this confluence of events fascinating. It highlights how interconnected global markets are and how alternative assets like Bitcoin can sometimes move independently of traditional risk indicators.

A retreat in global risk sentiment

The retreat in global risk sentiment stems from two major catalysts: a weaker-than-expected US jobs report and escalating tensions between the US and Russia. The jobs report, released for July, showed non-farm payrolls growing by just 73,000, falling well short of the 104,000 that economists had anticipated.

To make matters worse, the previous two months’ figures underwent a sharp downward revision of 258,000 jobs. This kind of miss, combined with such a significant adjustment, sends a clear signal that the US labor market might be cooling faster than anyone expected. This isn’t just a statistical blip. It raises legitimate questions about whether the US economy, often seen as the backbone of global growth, could be heading toward a slowdown or even a recession.

Adding fuel to the fire, geopolitical tensions between the US and Russia have flared up again. The US recently slapped new sanctions on Russia, and Moscow responded with countermeasures. This back-and-forth has stoked fears of a broader conflict, one that could disrupt global trade and energy markets at a time when the world economy already feels fragile.

This is a classic case of uncertainty driving market behaviour. Investors hate unknowns, and right now, there’s a lot they can’t predict about how this standoff might play out.

The impact on financial markets has been immediate and pronounced. In the US, the S&P 500 dropped 1.6 per cent, the Dow Jones fell 1.2 per cent, and the NASDAQ took a steeper 2.2 per cent hit. Volatility spiked, with the VIX climbing above 20 for the first time in over a month. Over in Asia, stocks closed last Friday on a weak note, with the MSCI Asia ex-Japan Index shedding 1.58 per cent.

South Korea’s KOSPI bore the brunt of the decline, plunging 3.88 per cent after the government announced plans to tighten capital gains taxes on stocks and hike transaction taxes. These moves reflect a broader flight from risk assets. Meanwhile, US Treasuries surged as investors piled into safe havens, pushing yields down across the board.

The two-year yield dropped 27.5 basis points to 3.682 per cent, and the 10-year yield fell 15.8 basis points to 4.216 per cent, its lowest in a month. The US Dollar Index slid 0.8 per cent, while gold jumped 2.2 per cent and Brent crude oil slipped 2.8 per cent on worries about weakening energy demand. This market reaction underscores how quickly sentiment can shift when economic and geopolitical risks collide.

Looking ahead, the US economic calendar is relatively quiet this week, with only a handful of data releases scheduled. Earnings reports from multinational corporations, pharmaceutical firms, and major insurers will take center stage instead.

In Asia, though, the data flow is heavier, with July inflation figures due from several countries and second-quarter GDP numbers coming out of Indonesia and the Philippines. These releases could offer more clues about whether the global economy is stabilizing or sliding further. I think the lack of major US data might give markets a breather, but any surprises from Asia could easily sway sentiment again.

The US jobs report: A closer look

Let’s dig into the US jobs report, because it’s the linchpin of this risk-off mood. The 73,000 increase in non-farm payrolls for July was a stark disappointment compared to the 104,000 that analysts had forecasted. The downward revision of 258,000 jobs for the prior two months only deepened the gloom.

I’ve seen weaker reports before, but this one stands out for how much it underperformed expectations and how it rewrote recent history with those revisions. Historically, sharp drops in job growth have often signaled trouble ahead.

Think back to the 2008 financial crisis, when non-farm payrolls tanked by over 500,000 in a single month. We’re not at that level yet, but the parallel isn’t lost on me. It’s a reminder that labor market weakness can be a leading indicator of bigger economic problems.

The fallout from this report has shifted expectations for Federal Reserve policy in a big way. Before the data hit, markets priced in 32 basis points of rate cuts over the remaining three FOMC meetings this year. Now, Fed-dated Overnight Index Swaps suggest a combined 60 basis points of easing. That’s nearly a full quarter-point cut per meeting, a clear sign that traders expect the Fed to act decisively to prop up the economy.

I find this pivot telling. It shows how sensitive markets are to labor data and how quickly they can recalibrate when the numbers disappoint. Lower Treasury yields, especially the steep drop in the two-year to 3.682 per cent, back up this view. Investors are betting on a more dovish Fed, and I’d argue they’re right to do so. If job growth keeps faltering, the Fed won’t have much choice but to ease aggressively.

The broader market reaction ties directly to this policy shift. Stocks fell hard because weaker jobs data dents confidence in corporate earnings and economic growth. Treasuries rallied as investors sought safety and anticipated lower rates. Gold’s 2.2 per cent jump reflects its appeal as a hedge against uncertainty, while the drop in Brent crude points to fears of a demand slowdown. For me, this all fits together logically.

A cooling labor market doesn’t just affect Wall Street; it ripples through consumer spending, energy use, and global trade. The question now is whether this is a temporary stumble or the start of something more serious. I lean toward caution here, given the size of those revisions and the geopolitical backdrop.

Bitcoin’s uptick: A bright spot amid the gloom

Against this stormy backdrop, Bitcoin has managed to shine, climbing 1.11 per cent in the past 24 hours. That might not sound like much, but in a market where stocks are tanking and volatility is spiking, it’s a standout performance. Several factors are driving this gain, and I think they highlight why Bitcoin often dances to its own tune.

First, institutional accumulation has played a big role. SharpLink Gaming’s US$108 million purchase of Ethereum signals strong corporate interest in crypto, and US ETF inflows of US$1.18 billion weekly suggest the trend extends to Bitcoin, even if specific BTC ETF data isn’t fresh here. Institutional investors have boosted their Bitcoin holdings by over 50 per cent in the past year, a stat that catches my eye. It shows how much the asset’s appeal has grown among heavy hitters who see it as a long-term store of value.

Second, selling pressure has eased. Miners, who dumped 3,000 BTC between July 16 and August 1, according to CryptoQuant, have since paused their sales. That’s a relief for the market, because miner outflows can weigh heavily on prices. With corporate and ETF buying stepping in to offset what selling did occur, Bitcoin has found some breathing room. I see this as a supply-demand dynamic at work—less selling plus steady buying equals upward pressure.

Third, regulatory developments have added a tailwind. The SEC’s approval of in-kind crypto ETPs has made it easier for institutions to get involved, boosting confidence. Hong Kong’s plan to launch tokenized bonds in 2025 is another positive signal, pointing to a future where digital assets play a bigger role in finance. I’m optimistic about these moves. They suggest regulators are warming up to crypto, which could unlock more capital inflows down the road.

From a technical angle, Bitcoin’s price action looks solid. The 14-day Relative Strength Index rose from 37.72, an oversold level, to 46.09 over seven days, indicating that bearish momentum is fading. The price also held firm at the 38.2 per cent Fibonacci level of US$117,135 after testing it on August 3, and the 200-day Exponential Moving Average at US$99,720 remains a strong long-term support.

To me, these levels matter. They show Bitcoin has a foundation to build on, even when broader markets wobble. The Fear & Greed Index ticking up from 48 to 52 in 24 hours reinforces this, despite US$164 million in long liquidations. It’s a sign that sentiment is shifting, and I’d argue it’s spot-driven demand—real buying, not just leverage—that’s keeping Bitcoin afloat.

My take and what’s next

Putting it all together, we’ve got a tale of two markets. On one hand, global risk sentiment is reeling from a dismal jobs report and US-Russia tensions. Stocks are down, yields are falling, and the Fed might need to step in with bigger rate cuts than anyone thought a week ago.

On the other hand, Bitcoin is holding its own, lifted by institutional interest, lighter selling, and regulatory progress. I find this contrast striking. It’s a reminder that traditional markets and crypto don’t always move in lockstep, especially when economic signals get murky.

As for what’s next, I’m keeping an eye on those upcoming data points: Asian inflation, GDP releases, and US earnings. They’ll either calm nerves or pour more fuel on the risk-off fire. For the US economy, I’m cautiously pessimistic.

The jobs report was a wake-up call, and while some argue the economy is still strong, those revisions and the Fed’s reaction tell me we’re not out of the woods. Bitcoin, though, has me more upbeat. Its resilience here suggests it’s carving out a niche as a hedge against uncertainty, and I wouldn’t be surprised to see it keep climbing if institutional buying holds up.

Markets are jittery, but opportunities like Bitcoin show there’s still light amid the gloom. Investors will need to stay sharp, because the week ahead could bring more twists.

 

Source: https://e27.co/when-markets-falter-us-jobs-russia-and-bitcoins-moment-to-shine-20250804/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

US-Japan ties strengthen markets, crypto rides the wave

US-Japan ties strengthen markets, crypto rides the wave

The US-Japan trade deal stands out as a major driver, signalling stronger economic ties between two of the world’s largest economies. Over the weekend, the US and the European Union also finalised a trade agreement, albeit one that introduces 15 per cent tariffs on European exports to the US.

Despite the tariffs, the resolution of this deal has been broadly welcomed as a step toward easing trade tensions, fostering a risk-on environment where investors feel emboldened to dive into equities and step back from safe-haven assets like gold.

I see a complex but largely encouraging picture emerging, though one that’s not without its potential pitfalls. Let’s talk about it.

Trade deals fuelling optimism

The US-Japan trade agreement has injected a dose of positivity into global markets. By reducing uncertainties and paving the way for increased trade, this deal promises to strengthen economic activity between these two powerhouses.

Japan, a major player in manufacturing and technology, stands to benefit from easier access to US markets, while American firms could see new opportunities in Japan. This development aligns with a broader narrative of thawing trade relations, which had been strained in recent years by tit-for-tat tariffs and geopolitical friction.

Meanwhile, the US-EU trade deal adds another layer to the story. The inclusion of 15 per cent tariffs on European exports might seem like a wrinkle, but the fact that negotiators reached an agreement at all has outweighed that concern for many investors. After months of saber-rattling and fears of an all-out trade war, this deal offers a measure of stability. It suggests that both sides prefer cooperation over confrontation, even if the terms aren’t perfect.

This resolution reflects a pragmatic approach by the Trump administration, avoiding the escalation that markets had braced for. The tariffs will undoubtedly raise costs for some European exporters, but the clarity provided by the deal could encourage businesses to adapt and invest with greater confidence.

US markets riding the wave

The US stock markets have wasted no time capitalising on this upbeat mood. The S&P 500 climbed 0.40 per cent to notch a fresh record high, while the Nasdaq followed suit with a 0.24 per cent gain. The Dow Jones Industrial Average also joined the rally, posting a 0.47 per cent increase.

These gains underscore the strength of the US corporate sector, which has delivered a solid earnings season so far. Companies across industries have reported resilient profits, defying earlier worries about slowing growth. For investors, this combination of strong fundamentals and positive trade news has been a green light to push equities higher.

The VIX, often dubbed Wall Street’s fear gauge, offers another clue to the prevailing sentiment. It slipped from 15.39 to 14.93, a modest but meaningful drop that signals reduced anxiety about market volatility.

Historically, a VIX below 20 indicates a relatively calm market, and this easing aligns with the risk-on vibe. This decline reflects a collective sigh of relief among traders, who see fewer immediate threats on the horizon. However, it’s worth noting that the VIX remains above its long-term average, suggesting that some underlying caution persists.

Bond yields and the dollar tell a mixed story

In contrast to the stock market’s exuberance, US Treasury yields have painted a more complicated picture. The 10-year yield edged down by 0.8 basis points to 4.388 per cent, while the two-year yield ticked up by 0.7 basis points to 3.923 per cent. This divergence hints at differing expectations for the short and long term.

The dip in the 10-year yield suggests that investors anticipate stable or even lower interest rates over the longer haul, perhaps due to confidence in the Federal Reserve’s ability to keep inflation in check. Conversely, the slight rise in the 2-year yield could reflect near-term uncertainty, possibly tied to upcoming economic data or speculation about rate hikes.

The US Dollar Index, up 0.28 per cent, has also benefited from this environment. A stronger dollar often accompanies positive sentiment about the US economy, and the trade deals have reinforced that narrative.

Meanwhile, gold took a hit, dropping 0.93 per cent as investors shed safe-haven assets in favour of riskier bets. Brent crude oil also slipped 1.1 per cent to US$68 per barrel, which might signal concerns about global demand despite the trade optimism.

Asian markets and crypto add context

Across the Pacific, Asian equities have shown a more cautious response. Last week, many markets closed lower as investors eyed this week’s Federal Open Market Committee meeting and the approaching US trade tariff deadline.

Today’s early trading saw a mixed start, contrasting with US equity index futures, which point to a higher open stateside. This regional divergence suggests that while the US enjoys a tailwind, Asia remains wary of unresolved trade issues and their local economic implications.

The cryptocurrency market, however, has mirrored the broader risk-on sentiment with its flair. Bitcoin, hovering near US$119,000, shrugged off a massive sale by Galaxy Digital, which unloaded 80,000 BTC worth over US$9 billion for a Satoshi-era investor.

Prices dipped briefly from $118,000 to $115,000 before bouncing back by Sunday. Analysts point to this resilience as evidence of Bitcoin’s maturation into a liquid, robust market. It’s a testament to how far the crypto industry has come since its volatile early days.

Ethereum, meanwhile, has stolen the spotlight. It’s spot ETFs raked in US$1.85 billion in net inflows for the week ending July 25, 2025, dwarfing Bitcoin ETFs’ US$72.06 million. Over the past three weeks, Ethereum ETFs have amassed US$4.94 billion, bringing their total net assets to US$20.66 billion.

This surge ties into what some refer to as the Utility Season narrative, where investors are drawn to Ethereum’s versatility in decentralised finance, NFTs, and beyond. Bitcoin’s store-of-value appeal remains strong, but Ethereum’s growth hints at a shift toward assets with broader functionality. I see this as a fascinating evolution in how investors weigh risk and reward.

What’s next?

From my perspective, the global risk sentiment feels like a tightrope walk. The trade deals and US earnings have laid a solid foundation, but the mixed signals from bonds, Asia, and commodities remind us that confidence is fragile.

The crypto market’s strength, particularly Ethereum’s rise, adds an intriguing dimension, suggesting that risk appetite extends beyond traditional assets.

Looking ahead, this week promises a deluge of data that could either solidify or shake this optimism. The US second-quarter GDP report, the July Personal Consumption Expenditures (PCE) index, and the July jobs report will provide a clearer view of the economy’s health.

Monetary policy decisions from the US, Canada, and Japan will also loom large, as central banks grapple with growth and inflation. The August 1 reciprocal tariff deadline adds another wildcard; any misstep could dent the current mood.

 

 

Source: https://e27.co/us-japan-ties-strengthen-markets-crypto-rides-the-wave-20250728/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j