Historic first half close for Wall Street: new records and new challenges

The first half of the year closed with Wall Street shining, setting new all-time highs. Both the S&P 500 and Nasdaq broke their previous records, maintaining a positive trend, while the Dow Jones also came close to its historical peak, just about 2% off.

Meanwhile, trade dynamics continued to play a key role in market movements. The resumption of talks between the United States and Canada sparked optimism after Ottawa decided to suspend the introduction of a digital services tax targeting American tech companies. This move had previously caused tensions and angered President Trump, leading to a temporary halt in negotiations.

Also in focus is the key date of July 9, marking the end of the suspension of many of Trump's tariffs. Treasury Secretary Scott Bessent clarified that countries involved may not receive further extensions, even though talks are ongoing.

On the currency front, the dollar continued its decline, registering its sixth consecutive month of losses against major currencies. The euro, in particular, reached its highest level against the dollar in nearly four years, highlighting the weakness of the greenback.

Another recurring theme this semester was Trump's increasing pressure on the Federal Reserve. The president recently sent a handwritten note to Jerome Powell, the head of the Fed, urging him to lower interest rates. Investor expectations regarding rate cuts have risen, with Fed funds futures now predicting nearly three cuts by the end of the year. Treasury yields have fallen further, with the 10-year bond hovering around 4.23%.

Meanwhile, in Washington, Senate Republicans are engaged in discussions about the president's proposed economic stimulus package, which could increase public debt by $3.3 trillion. Trump has called for swift approval before Independence Day on July 4, but internal divisions remain over the size of the package.

Finally, investors remain attentive to upcoming economic data, including the monthly labor market report, set to be released on Thursday. An additional opportunity to assess the health of the U.S. economy and guide future decisions.