• Peace or total escalation? –

Trump’s ultimatum to Putin expired on 8 August. If Trump follows through on his previous threats, he will now have to impose a series of sanctions not only against Russia, but also against its allies. Trump threatened further drastic tariff increases, especially for the BRICS countries that buy Russian oil. However, US special envoy Witkoff was in Moscow before the ultimatum expired to sound out Putin on what is still possible. The talks were reportedly constructive. It has now been announced that Putin wants to meet Trump in Alaska on 15 August for the first time to discuss, among other things, the difficult distribution of territorial claims in Ukraine. Even before the ultimatum expired, Trump raised tariffs on India to 50% because India buys Russian oil cheaply and exports it to the rest of the world at a higher price. But Brazil had already been hit with a 50% tariff, which is more politically motivated than based on facts.

The new tariffs came into force against all countries on 7 August, with Switzerland now facing a very high tariff of 39%. In addition to the threat of escalation in the tariff war with the BRICS countries, the big question is how the increased tariffs will affect global trade and economic development in the US. This is because the latest very weak labour market data point to stagflation in the US in the coming months.
The stock markets are clearly not yet seeing these risks, which was also due to the good financial results of most US tech stocks and US banks, which stabilised the US indices near their all-time highs. However, once again, the stock markets in Eastern Europe are performing even better than most Western stock markets, led by the Warsaw Stock Exchange, where the PTX index has risen by 41% (previous month: 37%) since the beginning of the year.

It is therefore still worth keeping an eye on Eastern Europe, including countries such as Georgia and Kazakhstan, which have the highest GDP growth rates. Andreas Männicke also gives his assessment of the new opportunities in Eastern Europe in his stock market newsletter EAST STOCK TRENDS (www.eaststock.de) and in his new EastStockTV video, episode 254, at www.YouTube.com. By the way: If, like me, you want to change this crazy world and bring more harmony to the world, you should register now with Tribe at https://tribe.de/free/post/4881c62c-de9d-43d9-a89d-70c459e6497f

Trump’s ultimatum brings movement in the Ukraine war

US President Trump now actually wants to meet with Putin in Alaska on 15 August, after his ultimatum to Russia expired on 8 August. The talks are initially to take place without Zelensky. Zelensky is also not prepared to discuss Russia’s territorial claims.

Trump had previously threatened not only harsh sanctions against Russia, but also an increase in tariffs against all allies. Shortly before the ultimatum expired, import duties on India were increased to 50% as punishment for India buying cheap Russian oil and then selling oil products all over the world, including to Germany. Russia has so far ignored Trump’s ultimatum and is now advancing further and further. Now the city of Kherson is to be taken. However, Putin is willing to talk to Trump and is now even offering a temporary partial ceasefire in the airspace. But Russia is still firing drones into Ukraine in large numbers. In view of the advance of Russian troops, Ukraine has ordered the evacuation of 19 towns in the Donetsk region in the east of the country.

Trump threatens BRICS countries with higher tariffs

If the talks between Putin and Trump are unsuccessful, a trade war between the US and the BRICS countries is looming, with China as the main opponent of the US. However, the BRICS countries have already made it clear to Trump that they will then develop counter-tariffs for the US. Trump’s tariffs could then backfire. The new budget law will increase the already very high level of debt enormously. However, this will also lead to a huge increase in interest payments, as capital market interest rates are still far too high at 4 to 5%.

In Germany, too, the interest burden has now risen to a record volume of €70 billion. The US has a current account deficit and a budget deficit of over $1 trillion almost every year. This also means that new US government bonds worth at least $1 trillion must be purchased every year. These will then have to be extended and refinanced at a later date, which will place a heavy burden on the government given the current high interest rates. Elon Musk has already warned of national bankruptcy if the US does not increase productivity enormously, although AI alone will not be enough to achieve this. However, AI is expected to generate additional growth of 0.5% of GDP. However, the latest US labour market data was very weak and points more towards stagflation, after GDP growth was surprisingly high at 3% in the second quarter.

Trump increases tariff revenues, but also debt

So far, Trump has been able to push through his increased tariffs. Trump has already collected USD 100 billion through the increased tariffs, but wants to collect USD 300 billion by the end of the year. However, this is peanuts compared to the spiralling new debt of USD 2 trillion resulting from the new budget law, ‘The Big Beautiful Bill’, which Elon Musk finds ‘disgusting’. Now Trump is also burdened by the Epstein file, which has still not been made public. However, Musk knows more about this, which could make things uncomfortable for Trump.

However, one now almost gets the impression that all country representatives are dancing to Trump’s tune with almost no opposition, but the BRICS will put up more resistance if Trump wants to implement this. The most important weapons here are raw materials, but also the possession of US government bonds. The EU has been downright submissive, as a 15% tariff is very negative, especially since tariffs on aluminium and steel remain at 50%.

Will the Putin/Trump meeting bring peace or a new escalation?

The next few weeks will show whether the talks between Trump and Putin on 15 August will lead to an escalation in tariffs or whether the situation will ease. The BRICS countries are and will remain on Russia’s side. However, the talks could lead to a lasting ceasefire if Selinskyi is present. A ceasefire lasting only 30 days, during which both sides simply arm themselves, would achieve nothing and would probably do more harm than good.

Trump is determined to end the unnecessary deaths of thousands of soldiers, which is urgently needed. However, Putin has very far-reaching demands for a peace treaty, so it is difficult to imagine that a quick peace treaty will be reached. A permanent ceasefire and a reasonably peaceful coexistence between eastern and western Ukraine would be possible, though. It is also possible and desirable that most sanctions against Russia will be lifted afterwards, including those affecting the capital market.

Trump on his way to the Nobel Peace Prize?

After all, thanks to Trump’s mediation, a peace treaty has now been signed in Washington between Armenia and Azerbaijan, which were previously enemies. Perhaps Trump will succeed in brokering peace between Ukraine and Russia at a later date, which would indeed qualify him for the Nobel Peace Prize. On the other hand, the continued support for Netanyahu is difficult to understand, although German Chancellor Merz now wants to stop sending weapons to Israel. Trump should do the same.

The EU wants to turn off the money tap for Russia

It may well be that later on, it will not be the US but the EU that becomes Russia’s main opponent, because the EU will be unwilling to cooperate, at least in the beginning. The EU, the UK and Canada have lowered the cap on oil prices from Russia from 60 to 47.60 USD in order to turn off Russia’s oil money tap. However, an end to the war in Ukraine is entirely conceivable with Trump. This would probably also ease the confrontation between the US and the BRICS countries somewhat, although a power struggle between the US and China and the battle for world domination are likely to continue.

Stock markets remain calm despite geopolitical risks

Geopolitical conflicts have so far played hardly any role in global stock markets. However, in the event of an escalation and a trade war between the US and BRICS, this is likely to have an impact. Foreign trade between China and the US has already declined, as has trade between the EU and the US. However, the major global stock markets are still almost all close to their all-time highs, with indices moving sideways in a stable manner, such as the DAX at around 24,000 index points (+20%) and the S&P index at around 6300 to 6400 index points (+9%). Due to good financial results, the seven ‘magic’ stocks rose the most once again, catapulting the NASDAQ index to a new all-time high of 21,450 index points (+11%). Once again, AI was the major growth driver for many tech companies.

Apple and Nvidia in the spotlight

Apple announced that it will invest USD 600 billion in the US alone over the next four years, causing its share price to rise by almost 10% in recent weeks from USD 205 to USD 230. Prior to this, Nvidia had already impressed with very good record figures, with the share price rising to a new all-time high of 182, representing a market capitalisation of 4.45 trillion, more than twice that of all 40 DAX stocks.

Bitcoin and gold remain in demand as ‘safe havens’

Bitcoin had previously reached a new all-time high of 122,000 BTC/USD. However, Ethereum rose even more sharply in the last month, climbing over 50% to over 4000 ETH/USD. Gold held up well near its all-time high of 3400 USD/ounce, although it would benefit from the Fed’s expected interest rate cut of 0.25 basis points in September. The gold price rose by 40% in USD and 30% in euros in one year, outperforming most stock indices around the world.

Eastern European stock markets continue to outperform

As in the previous year, some stock markets in Eastern Europe once again outperformed the DAX, with prices exploding to new highs for the year, especially in recent weeks. The UTX Index for shares from Ukraine has risen by 69% since the beginning of the year (previous month: 49%), while the PTX Index for shares from Poland has risen by 41% (previous week 34%), the CTX Index for shares from the Czech Republic rose by 35% (previous week 30%), and the HTX Index for shares from Hungary rose by 29% (previous month +25%), all of which clearly outperformed the DAX with a gain of 21% (previous month 17%) in euro terms. However, the SETX Index for shares from Southeast Europe also outperformed the DAX at the start of the year with a gain of 30% (previous month: 28%), clearly outperforming the DAX. The SBI Index for Slovenia alone rose by +30% since the beginning of the year, as did the CECE Index for Poland, Hungary and the Czech Republic, which rose by almost 40% (previous month: 32%).

The BTX Index for shares from Bulgaria also rose by 19% (previous month: +19%), and the ROTX Index for Romanian equities also rose by 22% (previous month: +18%), thus already performing as well as the DAX. With Bulgaria, a new Eastern European country will join the eurozone next year. The share prices of Eastern European banks are developing particularly well. The CECE banking index has already risen by 43% this year (previous month: +33%). Some interesting bank stocks from Eastern Europe were presented in an interview with Michael Mross on 19 July 2025 (see the new video at www.eaststock.de ) and were also highlighted as ‘Stocks of the Month’ in the stock market newsletter East Stock Trends. Bitcoin had previously reached a new all-time high of 122,000 BTC/USD. However, Ethereum rose even more sharply in the last month, namely by over 50%.

Inform yourself first, then invest

Find out more about the background and development of the Ukraine/Russia crisis now. But also about the future recovery potential of undervalued stocks from Eastern Europe. There are also new opportunities in the Baltic States, South-Eastern Europe and the CIS republics (Kazakhstan, Georgia), with all the respective stock indices posting gains in 2023. In 2023, 12 stock exchanges from Eastern Europe were among the 30 best-performing stock markets in the world, with five clearly outperforming the DAX. In 2024, nine stock exchanges from Eastern Europe once again outperformed the market with strong gains. And since the beginning of the year, five stock exchanges from Eastern Europe have once again clearly outperformed the DAX. It is therefore still worth looking beyond the horizon to Eastern Europe.
Order a trial subscription now (3 issues by email for only £15) to the monthly stock market newsletter EAST STOCK TRENDS (EST) with another Ukraine/Kazakhstan special and a dividend special, as well as lots of background information and new investment suggestions such as the ‘Stock of the Month’ and lucrative certificates at www.eaststock.de, under ‘Stock Market Letter’. The last EST was published on 31 July 2025 with a special on bank stocks from Eastern Europe.

TV/radio information: On 19 July 2025, Andreas Männicke was interviewed by Michael Mross on Mmnews-Plus about the top stocks in Eastern Europe. On 3 June 2025, Andreas Männicke was also interviewed by Heinrich Leben on Börsenradio Networks about new opportunities in Eastern Europe, particularly in Ukraine, following the end of the war. All radio and TV interviews can be downloaded from the video archive at www.eaststock.de, including the latest video on EastStockTV, episode 254. By the way: have you already subscribed to the new YouTube channel BRICS-TV in addition to the YouTube channel EastStockTV? Here is the link to the second BRICS-TV video: https://www.youtube.com/watch?v=_zN-qTv0xz4

Reading tip: In the 42nd issue of VTAD News from 2024, Andreas Männicke provides a detailed report on the BRICS as a new investment opportunity. Here is the link to the article: https://www.vtad.de/wp-content/uploads/2024/11/vtad-news-42.pdf

Seminar note: If you are interested in new East Stock Exchange seminars ‘Go East’ or a BRICS seminar in Frankfurt/M or other cities, please contact the EST editorial team (www.eaststock.de). If you are interested in East European stock market webinars and BRICS webinars, please also get in touch.

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