Potential Reasons for an Upcoming Market Decline in the Next Two Weeks

July 8 Tariff Deadline and Fed Rate Cuts

As of July 8, the 90-day pause on reciprocal tariffs initiated by President Trump is set to expire. If the pause is not extended, tariffs on the European Union could spike from 10% to 50%. Currently, Secretary of the Treasury Scott Bessent indicated that it is likely the administration will grant extensions for countries negotiating in good faith, although only one trade deal has been finalized with the U.K. and 17 others remain under negotiation.

In the Federal Reserve, discussions are heating up regarding potential rate cuts. Fed Governor Christopher Waller signaled a possible cut in July if inflation data is favorable, while Chair Jay Powell stressed caution, noting that upcoming tariff impacts could complicate the rate-setting process. The odds for a rate cut in July have increased from 5% to 25%, suggesting markets are anticipating such moves; however, Powell’s recent comments may temper these expectations.

In the rare earth sector, Luke Lango highlights MP Materials (MP) and USA Rare Earths (USAR) for potential investments as demand for these materials is expected to rise with advancements in AI-powered humanoid robots. China currently controls about 90% of the rare earth element market, creating opportunities for U.S.-based companies amidst escalating trade tensions.