Closing Recap

U.S. stocks finished mostly lower in a quiet session, pulling back from recent record highs as investors pared bets ahead of key inflation data today; gold plunged after President Trump clarified no tariffs would be placed on bullion, while oil was little changed and the dollar firmed digesting an expected rate cut from the Reserve Bank of Australia overnight. 

Key Takeaways 

• Stocks Fade After Strong Run: Major indices eased, with the Dow and S&P 500 slipping, as the market consolidated after a powerful multi-month rally. 
• All Eyes on CPI: Today’s U.S. Consumer Price Index (CPI) report for July is the main event, critical for shaping Federal Reserve policy expectations.
• Gold Tumbles on Tariff Clarification: Gold prices plunged nearly 2.5% after President Trump confirmed that gold bars will not be subject to tariffs, removing a key source of recent uncertainty and price support. 
• China Tariff Deadline Extended: President Trump signed an executive order extending the China tariff deadline for another 90 days (until November 9th), providing some near-term relief. 
• Bitcoin Eases: The cryptocurrency has pulled back from its recent record highs, with prices falling below $119k as risk appetite sours slightly ahead of the CPI data.
• Oil Flat, Dollar Firms: Crude oil prices finished near unchanged, while the U.S. dollar gained against major currencies. 
• RBA Cuts Rates: The Reserve Bank of Australia cut its cash rate by 25 basis points to 3.60% overnight, as widely expected, continuing the trend of global central bank easing.

Market Overview

U.S. equity markets started the week with a day of consolidation, finishing mostly in negative territory as investors took a breather from the powerful rally that has sent indices to record highs. After an initial move higher at the open, stocks couldn’t hold their gains and drifted lower, with traders likely paring some risk ahead of today’s critical Consumer Price Index (CPI) inflation report. The market’s upward momentum has been remarkable over the past four months, driven by strong earnings, signs of easing inflation, and hopes for trade de-escalation, but warnings about expensive valuations and a potential cooling-off period are growing louder. 

Index	Up/Down	% Change	Last
DJ Industrials	-199.72	-0.0045	43975
S&P 500	-15.94	-0.0025	6373
Nasdaq	-64.62	-0.003	21385
Russell 2000	-1.91	-0.0009	2216

The most significant market-moving news today was in the commodities space. Gold prices plunged nearly 2.5% after President Trump clarified that gold bars would not be subject to tariffs, resolving the uncertainty that had roiled the market last week and removing a key bullish catalyst. In trade news, President Trump provided some further near-term relief by officially signing an executive order to extend the China tariff deadline for another 90 days. 

Overnight, the Reserve Bank of Australia delivered a widely anticipated 25-basis-point rate cut, bringing its cash rate to 3.60%. This move aligns with the broader trend of global central banks (excluding the Fed, for now) moving towards easier monetary policy. 

Economic Calendar

The main event today is the U.S. Consumer Price Index report. Overnight, the Reserve Bank of Australia cut interest rates: 

• 8:30 AM ET / 12:30 PM GMT: Core CPI m/m (July) 
• 8:30 AM ET / 12:30 PM GMT: CPI m/m (July) 
• 8:30 AM ET / 12:30 PM GMT: CPI y/y (July) 
• Major International Events (Overnight): Reserve Bank of Australia (RBA) Rate Decision: Cut cash rate by 25 bps to 3.60% (from 3.85%), as expected. 

Commodities, Currencies, and Treasuries

Gold prices are attempting to stabilize after yesterday’s massive 2.5% plunge, which was triggered by President Trump’s clarification that gold bars will not be subject to tariffs. Crude oil prices are little changed, with WTI holding near the $64 level as the market balances ongoing geopolitical risks with underlying supply and demand fundamentals. 

Asset	Up/Down	Unit / % Change	Last
WTI Crude	0.08	USD/bbl	63.96
Brent	0.04	USD/bbl	66.63
Gold	-86.6	USD/oz	3404.7
EUR/USD	-0.0028	USD	1.1611
USD/JPY	0.41	JPY	148.13
10-Year Note	-0.011	%	0.04271

The U.S. dollar is slightly firmer ahead of the CPI report, consolidating after recent volatility. Treasury yields are steady, with the 10-year yield holding near 4.27% as bond traders await the inflation data for fresh directional cues. Bitcoin is showing weakness, falling 2.8% to below $119,000 as caution builds ahead of the CPI release, reversing some of its recent strong gains.

Looking Ahead 

Today’s session will be defined by the 8:30 AM ET release of the July U.S. Consumer Price Index (CPI) report. The market reaction to this data will be swift and significant, as it is a crucial piece of the puzzle for the Federal Reserve. A cooler-than-expected print could reignite the equity rally and put further pressure on the dollar and bond yields. Conversely, a hotter number could challenge the market’s “Greed” sentiment, temper rate cut expectations, and potentially trigger a more significant pullback.