Published by Global Banking & Finance Review®
Posted on July 3, 2025
5 min readLast updated: January 23, 2026
Add as preferred source on GoogleInvestors are preparing for market volatility due to events like U.S. jobs data and EU tariffs, impacting assets from gold to corporate credit.
By Naomi Rovnick and Lucy Raitano
LONDON (Reuters) -Big investors are mobilising to trade through weeks packed with wild-card events that may shatter the calm in stock markets and drive big swings for assets they see as exposed to both positive or negative surprises, from gold to corporate credit.
U.S. Treasuries, the dollar, yen and euro zone debt may also turn volatile, investors said, Thursday's U.S. jobs data is followed by next week's crunch U.S.-European Union tariff deadline and then an unpredictable French budget vote. After that, markets face an August 12 deadline for U.S.-China talks to achieve a trade deal.
"I can't think of a time in my history in markets, which is pretty long, where you've had so much risk and so little risk premium," said Insight Investment head of investment specialists April La Russe, referring to the compensation for holding risky assets over cash.
Here's a look at how investors are gaming out potential market flare-ups in the days and weeks ahead.
TARIFF TREMORS
Russell Investments global head of solutions strategy Van Luu said market participants were pricing a mildly positive outcome on July 9, with the U.S. and EU either settling for 10% universal tariffs or postponing a resolution, as the U.S. had with China.
He had turned negative on corporate credit because yields were underpricing the economic risks of ongoing tariff uncertainty, he said.
With Brussels now pushing for exemptions for key EU export sectors, the worst case scenario was a deadlock and markets starting to fear reciprocal tariffs, he said.
Amundi global head of macro Mahmood Pradhan, a former IMF deputy director for Europe, said the July 9 outcome was a coin-toss but a benign result was already priced into risky assets.
World stocks have rebounded and are up 24% since a low of April 8, soon after U.S. President Donald Trump delivered his "Liberation Day" April 2 bombshell of tariffs on imports from around the world.
"Given the rally we've had, there might not be more upside," Pradhan said.
DOLLAR, TREASURIES, GOLD
Any outcome on July 9 could hit the dollar and spark cross-currency volatility, investors said. The greenback is already down some 10% against other major currencies so far this year.
Treasuries would suffer if talks broke down in a threat to world trade, Artemis head of fixed income strategy Liam O'Donnell said. A long and steady accumulation of Treasuries by overseas investors and central banks has been partly driven by the dollar's dominant position in global trade flows.
Gold, which has soared by more than 25% year-to-date to $3,344 as investors piled into the precious metal to hedge portfolios against inflation and recession risks sparked by high tariffs, is also vulnerable to a positive EU tariff outcome.
"We could see profit taking (on gold) by real money investors and also hedge funds," Edmond de Rothschild multi-asset head Michael Nizard said.
DATA JOLTS
While latest U.S. payrolls data is released on Thursday, the next official payrolls report on Aug. 1 could be a bigger jolt to world markets than tariffs, coming at a time of holiday-thinned trade, investors added.
"In terms of what would produce the biggest market surprise, I think it's actually U.S. data because that has been flying under the radar," Russell's Luu said.
Artemis' O'Donnell said the upcoming U.S. job reports were the biggest event risk for markets.
Luu said gauges of expected volatility in some world currencies seemed too low, particularly those expressing how Japan's yen, which can rip higher when U.S. rate cut bets build, might swing against the dollar and the euro in the months ahead.
EUROPE DEBT STRESS
There are also crunch dates for Europe that could revive anxiety about debt stress, overshadowed so far by investors tapping assets such as triple-A rated German Bunds as Treasuries' haven appeal has diminished.
French Prime Minister Francois Bayrou survived his eighth no confidence motion on Tuesday but investors are wary about his chances of getting a plan to trim the euro zone's biggest budget deficit on July 14 through a parliament rocked by right-wing rebellions.
Germany's stimulus bonanza is also now rolling, with an upper house vote on business tax breaks on July 11. Benchmark Bund yields are about 25 basis points (bps) higher so far this year to around 2.62% given expectations for increased bond sales to fund extra borrowing.
The extra yield bond investors demand for lending to France over Germany, at 70 bps now, might be too low given the immediate French budget risk ahead.
"We prefer an underweight position in French sovereign bonds in the near term," RBC Wealth Management investment strategy head Frédérique Carrier said.
And Britain is also back on the watch-list as government U-turns on welfare reforms threaten a budget blowout, sparking fresh bond selling.
(Reporting by Naomi Rovnick and Lucy RaitanoEditing by Dhara Ranasinghe and Frances Kerry)
Investors are preparing for several key events, including the U.S. jobs data release and the U.S.-European Union tariff deadline, which could lead to significant market fluctuations.
Market participants are pricing in a mildly positive outcome regarding tariffs, but there is concern about potential deadlocks that could lead to reciprocal tariffs, negatively affecting corporate credit.
The upcoming U.S. payrolls report on August 1 is expected to be a major market mover, potentially producing larger surprises than tariff developments, especially during a period of low trading volume.
Gold prices have surged over 25% this year as investors seek to hedge against inflation and recession risks, but there may be profit-taking by investors in the near future.
Investors are wary of potential debt stress in Europe, particularly with France's budget deficit and Germany's recent stimulus measures, which could impact bond yields and investor confidence.
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