By Lawrence White
LONDON (Reuters) -Stocks slipped on Friday as U.S. 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 U.S. 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.
U.S. 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 U.S. jobs report on Thursday, sending all three of the main U.S. equity indexes climbing in a shortened session.
“The U.S. 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 U.S. government default but adds trillions to the national debt to fuel spending on border security and the military.
TRADE THE KEY FOCUS IN ASIA
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.
U.S. 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 U.S. dollar index had its worst first half since 1973 as Trump's chaotic roll-out of sweeping tariffs heightened concerns about the U.S. economy and the safety of Treasuries, but had rallied 0.4% on Thursday before retracing some of those gains on Friday.
