Trump's DOGE Initiative Pressures SEC to Ease SPAC and Private Fund Rules

Economic

Summary:

President Trump’s Department of Government Efficiency (DOGE) is actively pressing the U.S. Securities and Exchange Commission (SEC) to roll back Biden-era regulations...

DOGE Targets Wall Street Regulations

In a bold move toward financial deregulation, President Trump’s Department of Government Efficiency has set its sights on the SEC, urging the agency to relax rules on Special Purpose Acquisition Companies (SPACs) and private investment fund disclosures. According to insiders, DOGE officials are lobbying for changes that would undo key policies enacted under the Biden administration, particularly those aimed at protecting retail investors and increasing systemic risk oversight.

The proposed shift aligns with the Trump administration’s wider deregulatory agenda, championed as a means of boosting economic growth and investment. In a February 2025 executive order, Trump instructed DOGE to root out any regulation perceived as overly burdensome to business operations.

Pushback Within the SEC

However, the involvement of DOGE in shaping regulatory policy has sparked discomfort among career SEC staffers and financial reform advocates. Traditionally considered an independent agency, the SEC has long operated with limited political interference from the White House. Critics argue that DOGE’s active role in SEC policy discussions violates both precedent and the spirit of independent financial regulation.

Amanda Fischer, COO of Better Markets and former chief of staff to ex-SEC Chair Gary Gensler, described DOGE’s influence as “outrageous,” warning of conflicts of interest and the undermining of staff expertise.

SPAC Regulation in Focus

SPACs, once a booming financial tool used by companies like Lucid Motors and Trump's own media venture, came under scrutiny during the Biden administration. New rules sought to rein in misleading financial forecasts and increase sponsor accountability. However, Republican SEC Commissioners Mark Uyeda and Hester Peirce opposed these rules, viewing them as unnecessary and restrictive.

With the Trump administration’s backing, efforts are now underway to reverse or soften these regulations. The SEC is reportedly in dialogue with major exchanges about easing some SPAC requirements, signaling a potential resurgence of the once-flagging SPAC market.

Private Fund Transparency Also in Crosshairs

Another major target is the Form PF rule, which expanded disclosure requirements for private investment funds to help regulators assess systemic risk. While these rules were seen as necessary safeguards post-2008, Republican commissioners have argued they are excessive and could burden innovation.

Earlier this month, the SEC delayed compliance with the new Form PF requirements—a move interpreted by analysts as an early victory for the DOGE-led deregulatory push.

The Return of Political Oversight?

The intensifying involvement of the Trump administration in SEC operations represents a significant departure from long-standing norms. Under Trump’s leadership, the White House has increasingly asserted direct influence over independent regulatory bodies, including through dismissals of officials who challenge presidential authority.

Yet not all experts view the shift negatively. Adam Pritchard of the University of Michigan noted that a White House “kick in the pants” could motivate long-overdue regulatory pruning. While acknowledging the unorthodox approach, Pritchard suggested that some inefficiencies in the SEC might warrant external pressure.

Implications for Investors and Markets

While deregulation may reduce compliance costs for Wall Street firms and potentially revitalize SPAC activity, it also risks weakening protections for retail investors and obscuring financial risks. Without robust oversight, critics fear a repeat of past crises driven by opaque financial products and unchecked speculation.

The battle over SEC rulemaking is likely to continue in the months ahead, as DOGE pushes its agenda and market participants wait to see how much the agency’s independence will be preserved—or redefined—under Trump's second term.

DOGE’s growing involvement in SEC policy reflects a broader political shift toward centralized executive control over financial regulation. The outcome will significantly shape the investment landscape, with key consequences for transparency, investor protection, and systemic stability.

Source: Reuters

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Economic

Stocks

The BlackRock Investment Institute (BII) said on Tuesday that growing uncertainty around traditionally stable, long-term economic trends is pushing it toward shorter-term strategies amid an increasingly unclear global economic outlook.

For decades, markets have relied on core principles such as inflation stability, government fiscal discipline, central bank independence, and the safe-haven status of U.S. assets like the dollar and Treasuries. But investor confidence in these foundations has been shaken this year by U.S. tariffs, concerns over the future political independence of the Federal Reserve, and a broad re-evaluation of exposure to U.S. assets as U.S. President Donald Trump moves to reshape global trade dynamics.

"Longer term, with macro anchors lost, no one knows where the global economy is ultimately headed," BII, a division of U.S.-based BlackRock focused on investment research, said in a mid-year 2025 global investment outlook note.

"That’s why, for now, we invest in the here and now – and lean more on our tactical six- to 12-month horizon," it said.

The institute's investment outlooks are based on views from senior portfolio managers and investment executives at BlackRock, which is the world's largest asset manager.

BII said it has turned more optimistic on government bonds in the euro area over the next six to 12 months. In equities, it continues to favor U.S. stocks over their European counterparts.

Higher government spending in Europe could support the aerospace, defense, and financial sectors. But U.S. stocks are expected to outperform, driven by the artificial intelligence boom and demand for technology, even if tariffs will be a drag on the economy, it said.

Tariffs and slowing U.S. immigration are expected to maintain upward pressure on inflation, limiting the Federal Reserve's ability to cut interest rates, BII said.

The institute kept a bearish stance on long-dated U.S. Treasuries and shifted from an "underweight" to a "neutral" view on emerging market local currency debt after the dollar lost about 10% this year against major currencies.

"The potential for a further U.S. dollar retreat and brighter emerging market (EM) growth outlook make local currency EM bonds more attractive in a whole portfolio context," it said.

Source: Yahoo Finance

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Economic

Stocks

Post-Rally Pause: Futures Dip as Caution Sets In

Following a powerful first-half rally led by the S&P 500 and Nasdaq Composite—both closing at record highs on Monday—U.S. equity futures opened Tuesday in negative territory. The S&P 500 e-minis dipped 0.26%, Nasdaq 100 futures dropped 0.34%, and Dow futures fell 0.12% as of 5:51 a.m. ET. These declines reflect cautious sentiment after a robust quarter driven by artificial intelligence enthusiasm and resilient earnings.

At the heart of current market anxiety is the Senate’s ongoing voting marathon over President Donald Trump’s sweeping tax and spending bill. The proposed legislation—set to increase the national debt by $3.3 trillion—has triggered investor fears about long-term fiscal sustainability. Amendments are still being debated, adding to market volatility.

Adding fuel to the fire, a public clash between Trump and Tesla CEO Elon Musk over the tax bill further pressured Tesla stock, which fell nearly 4.7% in premarket trading. Musk’s companies, which have benefited from government subsidies, are now under scrutiny from a Trump-backed government efficiency review. Tesla’s weakening demand in Europe—reporting its sixth consecutive month of declining sales in Sweden and Denmark—exacerbated the stock’s drop.

Trade Tensions Cloud Market Sentiment

Compounding investor worries are signs of strain in U.S. trade negotiations. Trump voiced frustration with the slow pace of talks with Japan, while Treasury Secretary Scott Bessent warned that several nations may soon face significantly higher tariffs if deals aren’t struck before a July 9 deadline. These threats rekindle memories of previous disruptions caused by Trump’s erratic trade policies and could pressure multinational firms.

Markets are also eyeing key macroeconomic indicators and Federal Reserve communication. Investors await the June manufacturing surveys from S&P Global and ISM, May job openings data, and comments from Fed Chair Jerome Powell at an ECB forum later today. These signals could influence expectations for monetary policy amid rising bets on interest rate cuts.

Despite political and fiscal noise, traders are still pricing in a dovish tilt from the Fed, partly due to weak recent data and speculation that Trump may appoint a more accommodative central bank head. LSEG data shows markets anticipating 68 basis points of rate cuts by year-end and 135 basis points by October 2026.

IPO and Crypto-Linked Stocks Stay Active

Outside the political spotlight, Circle, a major stablecoin firm, rose 2.1% after announcing plans to establish a national trust bank in the U.S.—a move that would place the company under federal oversight and potentially boost its institutional legitimacy.

While Tuesday’s dip in futures reflects investor wariness amid political and economic crosscurrents, the underlying bullish sentiment remains intact following the market’s best quarterly performance in over a year. Much now hinges on clarity over the tax bill, upcoming economic data, and the trajectory of U.S. monetary policy. If markets digest these risks constructively, the current hesitation may prove to be a brief pause in an ongoing uptrend.

Source: Reuters

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Economic

Stocks

Nasdaq Leverages Tech Momentum and SPAC Revival to Outpace NYSE

In the first half of 2025, Nasdaq extended its leadership in the IPO arena by capturing a significantly larger share of U.S. stock market listings compared to the NYSE. According to Dealogic data, Nasdaq listings—including special purpose acquisition companies (SPACs)—raised approximately $21.3 billion, more than doubling the $8.7 billion raised on the NYSE. Even when SPACs are excluded, Nasdaq still led, with $9 billion raised across 79 traditional IPOs, outpacing NYSE’s $7.8 billion from just 15 deals.

This surge was powered by blockbuster listings such as CoreWeave’s $1.5 billion IPO and Chime’s offering, as well as renewed investor appetite following a volatile spring. Notably, Nasdaq has now led IPO rankings for six consecutive years, a reflection of its consistent appeal to high-growth, tech-forward companies.

Volatility Fades, IPO Pipeline Reignites

Market turbulence earlier this year—driven by policy instability and geopolitical shocks—had momentarily stalled IPO activity. However, a strong market rebound in May reignited listing momentum. Nasdaq President Nelson Griggs confirmed that companies are now “back having those discussions,” hinting at a busy fall season if early IPOs perform well.

The Nasdaq Composite and S&P 500 both closed June at record highs, signaling robust investor confidence and setting a fertile stage for upcoming listings. Highly anticipated IPOs from companies like Medline and Figma are expected to hit the market later in the year, potentially increasing the competitiveness between the exchanges.

Exchange Switches Signal Broader Appeal for Nasdaq

Adding to Nasdaq’s advantage was a wave of high-profile company transfers from the NYSE. Ten firms, including Kimberly-Clark and Thomson Reuters, switched their listings to Nasdaq in 2025, representing a combined market capitalization of $271.4 billion. This is the strongest first-half performance for Nasdaq in attracting switches since 2006.

One factor drawing companies to Nasdaq is the visibility and prestige associated with inclusion in the Nasdaq-100 index, which features heavyweights like Apple and Nvidia. The Nasdaq-100 has returned nearly 8% year-to-date, outperforming the S&P 500’s 5.5% gain, making it an attractive benchmark for growth-oriented firms.

NYSE, for its part, has retained relevance through major IPOs like Venture Global’s $1.75 billion listing—the largest of the year—and has seen several companies, including Virtu and CSW Industrials, transfer from Nasdaq. NYSE’s Global Head of Capital Markets, Michael Harris, projected continued strength in listings for the rest of 2025, emphasizing the diversity and depth of the exchange’s pipeline.

Capital Market Dynamics: U.S. Leads in Dual-Exchange Competition

The competition between Nasdaq and NYSE has played a pivotal role in reinforcing the appeal of U.S. capital markets over single-venue international rivals like Hong Kong or London. With each exchange tailoring its appeal to different industry sectors—Nasdaq for tech and innovation, NYSE for industrials and legacy brands—the dual-platform environment promotes innovation and investor engagement.

This competitive dynamic has helped the U.S. maintain its global leadership in capital formation. As companies increasingly weigh the benefits of index inclusion, sector alignment, and investor exposure, the second half of 2025 may bring further strategic listings—and possibly, a more balanced scoreboard between the exchanges.

Nasdaq’s first-half victory in 2025 highlights the continuing strength of technology companies in public markets and investor preference for growth-oriented listings. While volatility remains a risk, the rebound in IPOs and strategic exchange switches underscores the resilience of U.S. capital markets. If upcoming listings perform well and geopolitical risks remain contained, Nasdaq and NYSE could both see a vibrant second half, but Nasdaq currently holds the lead with a winning formula of innovation, index visibility, and investor trust.

Source: Reuters

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Glendon

Forex

Economic

Indonesia's exports surged in May ahead of a looming decision on threatened hefty US tariffs, data showed on Tuesday, while inflation remained low in June and analysts said there was room for the central bank to cut rates again to support the economy.

Exports rose 9.68% from a year earlier, the statistics bureau said, well above the median forecast of a 0.40% rise in a Reuters poll and outpacing a 4.14% rise in imports.

That saw the trade surplus in Southeast Asia's largest economy widen to US$4.3 billion (RM18.12 billion) in May, up from a five-year low of around US$160 million in April, as exporters wait for the July 9 deadline to complete tariff negotiations with the US.

"There is an effect of anticipation of the imposition of reciprocal tariffs from Trump, so it looks like exporters were frontloading," said Bank Mandiri economist Shahifa Assajjadiyyah.

Separate data showed the inflation rate was 1.87% in June, a touch stronger than expected but comfortably within Bank Indonesia's target range of 1.5% to 3.5%.

The central bank paused its easing cycle at a policy review last month, but said there was still room to cut rates given moderate inflation and the need to support economic activity.

Maybank Indonesia economist Myrdal Gunarto said the combination of inflation within the target range, a strong trade balance and a stable rupiah meant Bank Indonesia had room to start cutting rates again.

Like many other countries, Indonesia is in talks with Washington ahead of next week's deadline to avoid the US administration's threatened "reciprocal" tariffs.

Jakarta, facing a 32% tariff, has said it will ease import restrictions and rules on many goods and raw materials in a bid to make it easier to do business in the country.

Tuesday's data showed exports of crude and refined palm oil from January to May were 8.3 million tonne. Palm oil products and steel were among the key contributors to the rise in exports in May.

Indonesia's rice output from January to August is estimated at 24.97 million tonnes, up 14.09% compared to the same period last year, the bureau said.

Source: Theedgemarkets

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Economic

Commodity

China–U.S. Trade War

Global Supply Shock Rewrites Rare Earth Magnet Economics

China’s decision in April 2025 to tighten export controls on rare earth magnets—key components in electric vehicles (EVs), wind turbines, and electronics—has upended global supply chains. For years, non-Chinese producers struggled to compete due to China’s scale advantages, lower costs, and state support. But the new trade barriers have jolted automakers and electronics manufacturers into urgently sourcing magnets from outside China, even at steep premiums.

The impact was immediate. Rahim Suleman, CEO of Neo Performance Materials, which recently launched a magnet facility in Estonia, noted a surge in demand without needing to pitch for new business. “The phone is ringing off the hook,” he said, as clients scramble to secure non-Chinese supply in the face of rising geopolitical risk.

Premium Pricing Becomes the New Normal—for Now

Manufacturers once reluctant to absorb higher costs for magnets made outside China are now conceding. Industry sources report premiums of $10–$30 per kilogram for ex-China magnets—an increase that adds $20–$120 per EV depending on magnet volume. In Korea, customers of NovaTech are already paying 15–20% more for magnets produced in Vietnam. Germany’s Schaeffler and other unnamed automakers have also signed deals with Neo’s Estonia plant, according to company disclosures.

But such premiums are a double-edged sword. On one hand, they are essential to finance the emergence of ex-China production; on the other, they risk cutting into margins in industries like automotive manufacturing already battling price wars. As one European automaker put it, “We can’t absorb excessive premiums across all raw materials and still sell competitively on a global scale.”

Long Road Ahead to Challenge China's Dominance

While non-Chinese players are receiving more orders, their scale remains limited. China still accounts for around 90% of global permanent magnet supply. New facilities in Europe, the U.S., and Southeast Asia are only starting to ramp up, and it may take years—if not decades—to reach sufficient capacity and cost efficiency.

This imbalance creates a complex market dynamic: premiums must be high enough to sustain new investment but low enough to avoid demand destruction. Project Blue estimates that NdPr (neodymium-praseodymium oxide) prices must range between $75 and $105/kg to support global demand outside China. Australia’s Barrenjoey places the necessary price range even higher, between $120 and $180/kg to fund approximately 20 new mining and processing projects.

Yet current pricing for Chinese NdPr remains significantly lower—around $62/kg—posing a competitive challenge. One rare earth executive emphasized that “the cost of a one-month shutdown due to shortages dwarfs any premium we might pay,” reinforcing the causal logic driving firms toward supply chain diversification despite price shocks.

Crisis Accelerates Innovation and Regional Expansion

The supply crisis has also accelerated diversification efforts. NovaTech is investing 10 billion won in a new Vietnamese plant using locally processed rare earths. Britain’s Less Common Metals is exploring expansion into France. Meanwhile, demand-side innovations are surfacing: BMW and others are reducing or eliminating rare earth usage in select EV models.

However, analysts warn this isn’t a widespread solution. Rare earths remain critical to high-performance magnets and most electrified systems, and substitutes either underperform or come with other trade-offs.

Industry Struggles to Define Sustainable Premiums

The current surge in willingness to pay premiums reflects urgency, not long-term equilibrium. Neo’s Suleman cautions that if costs escalate too far, demand destruction becomes a real threat. “We need to be responsible,” he said, emphasizing the importance of collaborative pricing models that secure investment without overwhelming downstream customers.

Some automakers have accepted moderate premiums of 5–10% for sustainably sourced critical minerals, but wide consensus on what constitutes a “fair” premium has yet to emerge.

China’s export restrictions have reshaped the rare earth magnet market overnight, exposing global dependencies and triggering a race to diversify. While buyers are currently absorbing higher costs to ensure access, the industry faces a delicate balancing act: securing resilient supply chains without collapsing demand through excessive pricing. The long-term success of ex-China supply efforts will hinge on technological innovation, policy support, and pricing discipline across the value chain.

Source: Reuters

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Economic

Manufacturing Activity Nears Growth Threshold Amid Order Book Rebound

Eurozone manufacturing activity in June 2025 signaled early signs of a recovery, as the region's HCOB Manufacturing Purchasing Managers’ Index (PMI) edged up to 49.5 from 49.4 in May, its highest in nearly two years. Though the reading still fell short of the 50-point mark—indicating ongoing contraction—the results underscore a significant shift: new orders neither fell nor grew, effectively ending a 37-month period of uninterrupted decline.

This stabilization in order flow marks a turning point for a sector that has struggled under the weight of weak external demand, persistent inflationary pressures, and sluggish industrial output. The causal relationship is clear—rising new orders typically precede broader output recovery, suggesting the current momentum may evolve into expansion territory in the second half of the year.

Output Slows but Remains Positive

Despite improved new order dynamics, the manufacturing output index slipped to 50.8 from 51.5, a three-month low, although still above the 50 expansion threshold. This moderation suggests that while order volumes have stabilized, firms remain cautious in scaling up production aggressively—likely due to lagging employment growth and regional economic divergence.

Manufacturers also continued shedding jobs, with the employment index staying below 50 for a second consecutive year. This disconnection between stabilizing demand and continued workforce reduction reflects firms’ cautious stance, possibly driven by high labor costs, automation shifts, or residual uncertainty about the durability of demand recovery.

Export Orders Improve and Delivery Times Lengthen—Early Signs of Demand Strength

Another promising indicator emerged as export orders ceased their downward trajectory for the first time since March 2022. While modest, this signals a potential revival in external demand, particularly relevant for economies such as Germany and the Netherlands with high export-dependency.

Longer delivery times—traditionally seen as negative—were interpreted positively in this context. Rather than reflecting supply-side bottlenecks, they now suggest improved demand flow, as orders stretch production and logistics schedules slightly.

Regional Performance Diverges Sharply

PMI data continued to show stark national disparities. Ireland led the bloc with a 53.7 reading—its highest in over three years—while Greece, Spain, and the Netherlands also posted expansionary figures. Germany, although still in contraction at 49.0, reached its strongest level in nearly three years, buoyed by optimism over its new government’s fiscal growth package.

By contrast, France, Italy, and Austria recorded steeper manufacturing declines, dragging down the overall bloc’s performance. These disparities highlight that the eurozone’s recovery is uneven, with export-oriented northern countries showing faster rebounds than their southern counterparts.

Business Optimism Strengthens Amid Cost Relief

Business confidence across the euro area improved markedly, reaching its highest level since February 2022. German manufacturers, in particular, were notably upbeat about future production prospects, reflecting faith in the policy direction and demand outlook.

Simultaneously, input costs continued their descent, with June marking the third consecutive month of falling purchasing prices. This deflationary trend in production inputs contributed to a further, albeit slight, decline in factory gate prices. The relationship is causal: lower input costs create pricing room for manufacturers, easing margin pressures and supporting competitiveness, particularly in export markets.

Implications for ECB Policy Path

The European Central Bank, which has been in an extended easing cycle, is now expected to conclude its interest rate cuts with one final reduction in September, according to a Reuters poll. The stabilization of the manufacturing sector could support the case for a pause after September, especially if inflation risks return or growth re-accelerates more quickly than expected.

June’s PMI data for the eurozone manufacturing sector signals cautious optimism. While activity remains technically in contraction, the end of the three-year decline in new orders marks a potential inflection point. If momentum in export demand, cost moderation, and German fiscal support continue, the sector could shift into growth territory in the coming months. However, employment weakness and regional disparities remain risks that could temper the recovery’s strength and breadth.