EU and China Strike Rare Earths Deal to Ease Trade Strains

European Trade Commissioner Maros Sefcovic confirmed that Brussels and Beijing have reached an agreement on rare earths and magnets, Deltaone reported. Sefcovic also noted a separate understanding aimed at moderating Chinese hybrid vehicle exports, which could halve export volumes while opening wider access into the Chinese market for European car components and olive oil. The breakthrough arrives as global supply chains face mounting regulatory and geopolitical scrutiny, particularly across high-tech manufacturing and clean energy infrastructure. Access to rare earths remains a vital choke point for semiconductor producers, automotive giants, and industrial defense systems. By securing terms on magnets and mineral flows, the accord temporarily diffuses a major flashpoint between European policymakers and Beijing, providing immediate clarity for multinational manufacturers operating across both jurisdictions. While trade headlines offer relief on international inputs, the tape across US tech indices reflects an ongoing structural divergence. On my desk, QQQ is pinned in short gamma below its 755.04 flip, with spot trading at 752.59. The call wall sits directly overhead at 755, while the put wall rests down at 740. In short gamma, dealers are forced to sell into weakness and buy into strength, magnifying intraday chops rather than absorbing them. Skew on the tech benchmark sits elevated at 2.3, indicating traders are still paying up for downside protection despite headlines easing cross-border friction. Across the broader market, SPY tells a contrasting story. S&P 500 futures trade up 0.31% at 7,841, and cash SPY spot at 776.27 sits comfortably above its 771.01 flip in long gamma. With the call wall at 780 and the put wall down at 767, dealers on the broader index act as natural stabilizers, absorbing volatility while tech continues to wrestle with its own overhead supply line. Whether trade stability can lift tech back over its 755 flip is something positioning will show, not promise.