China condemned the Biden administration's decision to increase tariffs on various Chinese imports and vowed to take unspecified retaliatory actions. The new tariffs, ranging from 25% to 100% on items like semiconductors and electric vehicles, follow a review of tariffs initially imposed by former President Trump.

Amid an ideal investing environment, the Dow Jones Industrial Average has surged past 40,000 for the first time, driven by resilient corporate profits, low unemployment, and easing inflation. Investors are striking gold with gains in diverse markets, including tech stocks, cryptocurrencies, and precious metals. Despite some concerns about government debt and market timing, optimism remains high, with strategists predicting continued growth fueled by advancements in AI and domestic investment. Even risk-averse investors find attractive options in high-yield bonds and CDs, adding to the widespread market exuberance.

Amid improving economic indicators and anticipation of fewer Federal Reserve rate cuts, big tech companies, particularly those focused on AI, are expected to drive the next market surge. Nvidia, set to release earnings next week, is among the leaders in this trend. Capital Economics predicts that AI-driven optimism will propel tech stocks higher, despite recent cautious investor sentiment. The resilience of cyclical sectors and robust economic outlook further support the potential for an AI-fueled equity bubble, with big tech poised to regain and extend its dominance in the market.

In an aggressive move to revive its struggling property market, Beijing has unveiled a comprehensive rescue package, including the removal of mortgage rate floors and lowering down payments. The People's Bank of China will inject $42 billion to help government-backed firms purchase unsold homes, converting them into affordable housing. Despite this, analysts warn that the funds may fall short of what’s needed to fully address the housing glut. The market responded positively, with developer shares surging, but experts caution that a lasting recovery will require careful execution and broader financial support.