Stocks, dollar dip as Trump passes spending bill, deal deadline looms

Stocks slipped on Friday as US President Donald Trump got his signature tax cut bill over the line and attention turned to his July 9 deadline for countries to secure trade deals with the world's biggest economy.

The dollar also fell against major currencies, with US markets already shut for the holiday-shortened week, as traders considered the impact of Trump's sweeping spending bill that is expected to add an estimated $3.4 trillion to the national debt.

The pan-European STOXX 600 index fell 0.5%, with banks, mining-related stocks and retailers among the top laggards.

US S&P 500 futures edged down 0.6%, following a 0.8% overnight advance for the cash index to an all-time closing peak. Wall Street was closed on Friday for the Independence Day holiday.

Trump said Washington would start sending letters to countries on Friday specifying what tariff rates they would face on exports to the United States, a clear shift from earlier pledges to strike scores of individual deals before a July 9 deadline when tariffs could rise sharply.

Investors are "now just waiting for July 9", said Tony Sycamore, an analyst at IG, with the market's lack of optimism for trade deals responsible for some of the equity weakness in export-reliant Asia, particularly Japan and South Korea.

At the same time, investors cheered a surprisingly robust US jobs report on Thursday, sending all three of the main US equity indexes climbing in a shortened session.

"The US economy is holding together better than most people expected, which suggests to me that markets can easily continue to do better (from here)," Sycamore said.

Following Thursday's close, the House narrowly approved Trump's signature, 869-page bill, which averts the near-term prospect of a US government default but adds trillions to the national debt to fuel spending on border security and the military.

Trump said he expected "a couple" more trade agreements, after announcing a deal with Vietnam on Wednesday to add to framework agreements with China and Britain as the only successes so far.

US Treasury Secretary Scott Bessent said earlier this week that a deal with India was close. However, progress on agreements with Japan and South Korea, once touted by the White House as likely to be among the earliest to be announced, appears to have broken down.

The US dollar index had its worst first half since 1973 as Trump's chaotic roll-out of sweeping tariffs heightened concerns about the US economy and the safety of Treasuries, but had rallied 0.4% on Thursday before retracing some of those gains on Friday.

As of 1430 GMT it was down 0.1% at 96.94.

The euro added 0.2% to $1.1778, while sterling held steady at $1.3662 as British assets steadied following investor fright over the last two days at a tearful appearance by Finance Minister Rachel Reeves in parliament on Wednesday.

The US Treasury bond market was closed on Friday for the holiday, but 10-year yields rose 4.7 basis points (bps) to 4.34%, while the 2-year yield jumped 9.3 bps to 3.882%.

Gold firmed 0.4% to $3,336 per ounce, on track for a weekly gain as investors again sought refuge in safe-haven assets due to concerns over the U.S.'s fiscal position and tariffs.

Brent crude futures fell 57 cents to $68.23 a barrel, while US West Texas Intermediate crude dropped 66 cents to $66.34, as Iran reaffirmed its commitment to nuclear non-proliferation. Copper prices retreated on Friday as focus switched to US President Donald Trump's July 9 deadline when sweeping tariffs take effect on countries that have not yet secured trade agreements.

Benchmark copper on the London Metal Exchange (LME) was down 0.8% at $9,880 a metric tone in official open-outcry trading, having hit a three-month high of $10,020.5 a tone earlier this week.

Volumes were subdued due to the July 4 Independence Day holiday in the United States, traders said.

Trump said his administration will begin sending letters later on Friday to 10 to 12 countries informing them of the tariff rate their products will face in the US

Caution due to several large trading partners, including the European Union, Japan and India, still trying to negotiate a deal with the US had triggered profit-taking on long positions or bets on higher prices, traders said.

On the technical front, first support for copper, used in power and construction, comes in at the 21-day moving average around $9,762.

Elsewhere, worries about aluminium supplies on the LME created by large holdings of warrants and nearby contracts receded due to slowing outflows and deliveries to the LME-registered warehouses.

Aluminium stocks in LME warehouses have climbed 27,025 tonnes to 363,925 tonnes since June 25. Cancelled warrants or metal earmarked for delivery at 2% indicate only small amounts are due to be delivered out.

Overall, a softer dollar was providing some support for industrial metals on Friday. But traders said growing prospects of the Federal Reserve holding interest rates steady after Thursday's strong jobs report could boost the US currency and weigh on metals demand.

Aluminium was down 0.6% at $2,590.5 a tone in official activity, zinc fell 0.5% to $2,736, lead eased 0.1% to $2,062, tin retreated 0.3% to $33,750 and nickel slipped 0.9% to $15,315.

Agencies