Russian forces gain control of two settlements in Ukraine, Russian military says
A ministry statement issued on Sunday said Russian troops had seized Piddubne in the Donetsk region, where Moscow's forces have long been advancing slowly westward. The statement said Russian forces also captured Sobolivka, near the town of Kupiansk in the Kharkiv region, another area that for months has been under Russian attack.
A subsequent Russian ministry statement said the "east" group of the Russian forces penetrated defences around Piddubne. The village is located southwest of Pokrovsk, one of the focal points of Russian military action in the drive to secure control over all of the Donetsk region.
Ukraine's General Staff in its own statement made no mention of either village changing hands. But it reported Russian attacks in other villages near Kupiansk, which according to local officials has been all but destroyed after being occupied by Russian forces in the first weeks after the February 2022 invasion and later recaptured by Ukrainian forces.
Sobolivka is located west of the town and the Russia statement, if accurate, would indicate some Russian gains in the area.
Reuters could not independently verify battlefield reports from either side.
Separately, Interfax news agency said Russian forces hit a Ukrainian air base, a facility for the production of components for long-range drones and ammunition warehouses.
And in the northeastern region of Sumy, where Russian forces have carved out a foothold in recent weeks, Russian shelling killed two residents in the village of Bytytsya, just inside the border, the regional governor said.
Russia controls nearly 19% of what is internationally recognised to be Ukraine, including the Luhansk region in the east, more than 70% of the Donetsk, Zaporizhzhia and Kherson regions, and fragments of the Kharkiv and Sumy regions.
Russia has said Ukraine must abandon four regions - Donetsk, Luhansk, Zaporizhzhia and Kherson - as part of any prospective peace settlement.
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It cannot be and should not be.' He added: 'There needs to be greater appreciation of the emergence of various centres of power in the world' and that Brics 'should be seen in positive light rather than in a negative light. 'It cannot be that might should now be right where, in the end, those who are more powerful are the ones who seek to have vengeance against those who are seeking to do good in the world.' Donald Trump has announced 25pc tariffs on South Korea and Japan as he talked up the 'strength' of America's trading relationships with both countries. On his Truth Social platform, he shared letters to the two countries, saying that the new tariffs would begin on August 1. In the correspondence, Mr Trump wrote: 'It is a great honour for me to send you this letter in that it demonstrates the strength and commitment of our trading relationship.' He suggested that the tariff rate could be cut if South Korea or Japan were to lower their barriers. But he said: 'If for any reason you decide to raise your tariffs, then, whatever the number you choose to raise them by will be added onto the 25pc that we charge.' Ireland's prime minister remains 'hopeful' that the EU can reach a deal with the US on tariffs. Micheal Martin said both sides continue to negotiate the 'fine detail' of future arrangements. It comes before a looming Wednesday deadline to make a new deal with the Trump administration, which piling pressure on trading partners by threatening dramatically increased tariffs from the existing 10pc rate. Speaking to the media after a phone call with the European Commission president, Mr Martin said Ursula von der Leyen outlined to him the 'most up to date situation'. Mr Martin said: 'We remain hopeful that the US and the European Union can agree an outline agreement or framework principle agreement this week. 'There's still a number of issues to negotiated, nothing has been rejected, definitively. 'But what it does illustrate, though, that even if a framework agreement is arrived at, there would be a lot of negotiations subsequently. 'So therefore, whilst it would create some degree of clarity in terms of where we are in the short term, there would still be a number of issues outstanding in respect of that trade issue between the European Union and the United States and indeed between other countries.' Asked if he expected a 10pc baseline tariff to remain in place, he said: 'There are certain realities that probably will emerge from this that will have impact - and are having impact - on a number of sectors. 'But at least it gives us some sense of the landscape that we have to deal with.' European Commission president Ursula von der Leyen has said that the EU must show strength in ongoing trade talks with the United States. 'When the Commission sits down with the United States to negotiate on trade and tariffs, Europe must show strength,' she told the European Parliament. Wall Street's so-called fear index is up less than 1pc today, despite a looming announcement from Donald Trump. The Vix index rose 0.9pc, a far cry from the days after Mr Trump first announced his 'liberation day' tariffs in April. The index surged 51pc on April 4 alone. Danni Hewson, of stockbroker AJ Bell, said: 'Earlier this year investors coined the term 'Taco (Trump always chickens out) trade', so it's probably not surprising that markets haven't really reacted to news that Donald Trump's tariff deadline has been shifted once again. 'This time it's not so much that the US president has chickened out, more that his administration might have bitten off more than they could chew in one sitting. 'Negotiating bespoke trade agreements with most of the world is more like slowly indulging in an elaborate multi-course tasting menu than scoffing down the burger and fries Mr Trump is reportedly fond of. But for investors eyeing that long summer break, the lingering uncertainty is unhelpful at best. For those negotiating their country's deal, it's downright damaging. 'It's no surprise the EU is hoping to get their deal over the line by the original July 9 deadline.' Peter Navarro, one of Donald Trump's closest advisers, has continued the Trump administration's attacks on Fed chairman Jerome Powell. He said that Mr Powell's refused to cut interest rates is fuelling 'serious economic damage', including inflicting 'acute financialpain' on households. Mr Navarro said urged the Fed board to intervene. If Mr Powell 'will not voluntarily adjust course, the board mustact decisively to prevent further economic harm', he said. Last week, Mr Powell blamed Mr Trump's trade war for high interest rates. He said: 'In effect we went on hold when we saw the size of the tariffs. 'Essentially all inflation forecasts for the United States went up materially as a consequence of the tariffs. We didn't overreact, in fact we didn't react at all. We're simply taking some time.' US stocks are lower this afternoon as Donald Trump steps up pressure on trading partners to make deals before a Wednesday deadline. The S&P 500 and Dow Jones are 0.6pc lower, while the Nasdaq has fallen 0.8pc. Tesla tumbled 7.6pc for the biggest drop among S&P 500 stocks as the feud between chief executive Elon Musk and Mr Trump reignited over the weekend. Wall Street was watching for developments in the Trump administration's bid to reshape global trade by threatening sharply higher tariffs on US trading partners. The near-term outlook will likely hinge on several key factors like the extent to which trading partners are included in Trump letters, the rate of tariffs and the effective date of such tariffs, according to analysts at Nomura. Last week, the Trump administration announced that it reached a deal with Vietnam that would allow US goods to enter the country duty-free, while Vietnamese exports to the US would face a 20pc levy. That was a decline from the 46pc tax on Vietnamese imports the US president proposed in April. 'The type of deal struck with Vietnam may be a blueprint for similar countries in the region with economies heavily reliant on large trade deficits with the US,' said Jason Pride, of wealth manager Glenmede. Mercedes-Benz pointed the finger at 'volatile' tariffs as it revealed that vehicle sales had fallen 9pc during the second quarter of the year. Deliveries fell to 547,100 cars and vans in the April-June period, while sales of battery electric vehicles dropped even more sharply by 18pc, to 41,900 vehicles, the company said. Second-quarter sales of Mercedes cars in North America dropped 14pc, while they slumped 19pc in China. 'Deliveries to dealerships were carefully calibrated to navigate new global tariff policies, impacting sales of Mercedes-Benz cars in the US and China in particular,' it said. Meanwhile, in Germany and Europe, sales were up 7pc and 1pc, respectively, the carmaker added. Worries that a falling dollar will fuel US inflation are overblown, a leading economist has said. The dollar has fallen 10.3pc against its key rivals this year, meaning that it costs more to buy goods prices in other currencies. But Bradley Saunders, of Capital Economics, said that the inflationary effect will be muted because the US is a special case: around 95pc of US imports are invoiced in dollars. He added: 'Imports only account for around 10pc of overall consumer spending, either through direct consumption of final goods or indirectly as inputs in domestically-produced goods. This implies that the Fed can expect, at most, a 0.1pc percentage point boost to consumer prices from a weaker dollar in the coming months.' The architect of Donald Trump's sweeping tariffs insisted he was 'happy with the progress' made despite promising the US would sign 90 trade deals in 90 days after 'liberation day'. Peter Navarro, one of the president's closest advisers, said US trading partners were showing 'how difficult it is for these countries to give up the advantage that they have over us'. He said that 'tariff revenues are coming in and really helping this country'. He also insisted that tariffs had not pushed up costs for US consumers. 'We have seen absolutely no pass-through of tariffs — it's just not in the data,' he told CNBC. US stocks remain down as traders wait for details of the letters sent by Donald Trump's administration to countries around the world. 'Markets like certainty and this tariff situation increases uncertainty,' said Adam Sarhan of 50 Park Investments. The Dow Jones Industrial Average and S&P 500 were down 0.3pc, while the Nasdaq Composite fell 0.6pc. The latter two hit record highs last week. 'There is a little trade uncertainty in the mix today... but it isn't a stretch to think the market is also simply adhering to some consolidation interest after making such a massive run,' said analyst Patrick O'Hare. President Trump's tariff campaign has raised questions about the appeal of US assets. However, this chart shows aims to show there is still a long way to go before markets call time on so-called US exceptionalism. One of Wall Street's big banks thinks Donald Trump will only be manage to announce 'some kind of blanket agreement' with trade partners as the reality of the negotiations hits home. Morgan Stanley said fully-fledged trades deals take on three years to conclude, rather than the three months allowed by the White House under the President's 90-day pause of his 'reciprocal' tariffs. It said it is expecting something akin to the deal with Britain, where 'only a couple sectors were specifically discussed'. Global chief economist Seth B Carpenter said: 'Historically, fully fledged trade deals take, on average, three years to conclude, not three months. 'While history has not been a blueprint for how this year has gone, we still think the lessons are critical, and intense negotiations surround each product category included in trade agreements. 'Our best guess is that any near-term announcements will not be comprehensive and permanent, and will likely be some kind of blanket agreement. For example, the UK-US agreement was not so much a complete trade agreement but rather a mutual détente that identifies where the US and UK are aligned. 'The details of the US-UK negotiation show that only a couple sectors were specifically discussed, with most sectors left 'open for further dialogue.' 'Open questions remain on the final legal status of the arrangement and how future sector-based tariffs from the US will be dealt with.' Wall Street's main stock markets slumped at the opening bell as traders wait to see what kind of tariffs are faced by US trading partners. The Dow Jones Industrial Average fell 0.3pc to 44,692.21 while the benchmark S&P 500 dropped 0.4pc to 6,253.99. The tech-heavy Nasdaq Composite declined 0.6pc to 20,484.54. Downing Street is racing to secure a deal to eliminate American tariffs on UK steel ahead of a deadline this week. Donald Trump plans to start implementing tariffs on the US's trade partners, which could include a 50pc levy on UK steel and aluminium. Initially the deadline for this had been July 9, although the Trump administration said on Sunday that tariffs would not be implemented until August 1. An agreement on eliminating the 25pc rate on steel was not reached alongside the trade deal struck with the Trump administration sparing car and aeroplane manufacturers. Asked if the Government was confident a deal will be reached, a No 10 spokesman said: 'Our work with the US continues to get this deal implemented as soon as possible. 'That will remove the 25pc tariff on UK steel and aluminium, making us the only country in the world to have tariffs removed on these products. 'The US agreed to remove tariffs on these products as part of our agreement on May 8. It reiterated that again at the G7 last month. The discussions continue, and will continue to do so.' Pressed again whether ministers were confident British producers will not be hit by the 50pc tariff, the Downing Street spokesman said: 'As I say, discussions continue. We have very close engagement with the US, and the US has been clear that it wants to keep talking to us to get the best deal for businesses and consumers on both sides.' Donald Trump's tariff war is the result of a 'deeper, more durable superpower rivalry' between the world's two largest economies, an economist has said. Neil Shearing, group chief economist at Capital Economics, said the fracturing of trading relationships under the US president 'isn't the end of globalisation, but its reinvention'. He said: 'Apple's decision to start shifting iPhone production to India, beyond the reach of US tariffs on China, is perhaps the most prominent illustration of how firms are adapting to new geopolitical realities. 'Trade flows are not shrinking – they're shifting. 'Meanwhile, Beijing's restrictions on rare earth exports reinforce how control over critical minerals is part of a country's strategic arsenal. 'Add in the US's 'America First' investment agenda, with its explicit objective of drawing in capital from allies even as investment from China is restricted, and you begin to see the contours of a world increasingly shaped by geopolitics.' The US treasury secretary said he would meet with his Chinese counterpart in the next couple of weeks as the world's two largest economies seek further de-escalate trade tensions. Scott Bessent told CNBC: 'We will discuss whether we are able to move beyond trade into other areas.' Scott Bessent said his 'mailbox was full last night' with a lot of new proposals from US trading partners. The US treasury secretary said a lot of 'people have changed their tunes' after Donald Trump said he would send letters to countries outlining new planned tariff rates. He said the President is concerned about 'the quality of the deals, not the quantity'. Malaysia said it maintains an independent foreign and economic policy after Donald Trump's threat to Brics-aligned nations. Its trade ministry said it is focused on trade facilitation not ideological alignment. Malaysia was accepted as a partner country to the Brics group of developing nations last October. Copper and other industrial metals extended losses after Donald Trump's tariff threats against countries aligned to the Brics nations. Industrial metals broadly fell on the London Metal Exchange, with aluminium down 1pc to $2,564.5 a ton and copper down 0.6pc. The US is expected to finalise its reciprocal tariffs this week, which are aimed at narrowing trade deficits. Details on sectoral tariffs aimed at boosting US industrial production, including of aluminium, steel and copper, are still under discussion. Oil prices edged higher despite concern about the potential impact of US tariffs. Brent crude was up 0.6pc towards $69 a barrel even as Donald Trump's latest tariff threats raised concerns about demand in the global economy. Priyanka Sachdeva, an analyst at Phillip Nova, said: 'Concerns over Trump's tariffs continue to be the broad theme in the second half of 2025, with dollar weakness the only support for oil for now.' Oil prices dipped in early trading after the Opec+ alliance agreed on Saturday to ramp up production in August by 548,000 barrels per day. UBS analyst Giovanni Staunovo, said: 'For now, the oil market remains tight, suggesting it can absorb additional barrels.' Much has been made of the recovery in US stocks since Donald Trump announced his 'liberation day' tariffs on April 2. If you had invested in the S&P 500 at the low point after the President held up his board of tariff rates at the White House, you would be up 26pc in dollar terms. Investors using the US currency would be up 7pc since the start of the year. However, compared to stocks in the rest of the world, the US market remains flat. The pound fell against the dollar as the US was poised to impose steeper tariffs on trading partners around the world. Sterling slipped 0.3pc to around $1.36 as Donald Trump said a dozen countries would receive letters with their new, higher levies. However, the dollar remained close to its four-year lows against the pound and the euro and earlier hit its weakest since 2015 versus the Swiss franc. So far, only Britain, China and Vietnam have agreed any sort of trade deal with the Trump administration. James Kniveton, an analyst at payments company Convera, said: 'Market volatility appears inevitable when the pause officially ends and new tariff levels are announced.' He added: 'Unlike previous announcements where tariff levels exceeded expectations, current proposals are largely anticipated. Moreover, markets appear to be pricing in continued deadline extensions.' US stock indexes were mixed as investors grappled with uncertainty around US tariff policies. Donald Trump said countries would receive letters today outlining their new tariff rates, which are due to come into effect on August 1. The US president had initially imposed a 90-day suspension to tariff which was due to expire on Wednesday. He has also threatened to impose an extra 10pc tariff on countries aligning themselves with the 'Anti-American policies' of the Brics group of nations. US markets were poised for an uncertain start to the week, days after the Dow Jones Industrial Average closed last week about 0.5pc away from its own record high. Tesla dropped 6.6pc in premarket trading after Elon Musk announced the formation of a new US political party, marking a new escalation in his feud with Trump. The US president said the car maker's billionaire boss had gone 'off the rails'. Ahead of the opening bell, the Dow was flat while the S&P 500 was down 0.3pc. The Nasdaq 100 was lower by 0.4pc. China opposes tariffs being used as a tool to coerce others, its foreign ministry said, after Donald Trump threatened an extra 10pc tariffs on countries aligning themselves with the Brics nations. Spokesman Mao Ning said the use of tariffs serves no one. China and Hong Kong stocks fell as anxiety over US trade policy intensified. China's blue-chip CSI300 closed down 0.4pc at 3,965.17, while the Shanghai Composite Index barely changed at 3,473.13 as Donald Trump said trading partners would receive letters today setting out new tariff rates due to kick in from August 1. In Hong Kong, the benchmark Hang Seng was down 0.1pc to 23,887.83. German industrial production rose more strongly than expected in May, official data showed Monday, boosting hopes that Europe's largest economy has turned a corner despite trade tensions with the United States. Output from manufacturing, mining, and utilities companies rose by 1.2pc compared to April, after dropping 1.6pc in the wake of Donald Trump's 'liberation day' tariffs, the federal statistics agency Destatis said. The rebound was driven by a surge in energy output and a strong performance from the beleaguered automotive sector, where production was up 4.9pc. Overall, industrial production was up 1pc on the same month last year, underlining hopes that the worst might be over for German industry after a series of strong production and orders data releases since the start of the year. ING bank analyst Carsten Brzeski said the data 'increased the likelihood' that the industrial recovery of recent months was driven by more than 'front-loading' as a result of customers putting in orders before US tariffs take effect. 'It's too early to give the all-clear, but signs of at least a cyclical rebound, albeit from low levels, are increasing', he said. South Africa is not anti-American and still wants to negotiate a trade deal with the United States, a trade ministry spokesman said. Donald Trump threatened an extra 10pc tariff on countries aligned with the Brics group, which is holding a summit in Brazil. The US president accused Brics, of which South Africa is a member, of 'anti-American' policies on Sunday. South Africa has been trying to negotiate a trade deal with Trump's administration since May, when Trump hosted President Cyril Ramaphosa for talks in the White House. 'We still await formal communication from the US in respect our trade deal but our conversations remain constructive and fruitful,' trade ministry spokesman Kaamil Alli told Reuters. 'As we have communicated previously, we are not anti-American,' Alli said. The US treasury secretary indicated some countries will be given the option of an extension to Wednesday's tariff deadline. Scott Bessent said the Trump administration was 'going to be very busy over the next 72 hours' in the run up to the July 9, when the 90-day pause on the US president's 'reciprocal' tariffs is due to come to an end. Mr Trump has said trading partners will receive letters from the US by 5pm UK time outlining what their tariff rates will be. Commerce secretary Howard Lutnick said those new rates would come into effect from August 1. Mr Bessent acknowledged there had been 'a lot of congestion going into the home stretch', adding that the US president's letters to trade partners was effectively a bid to get the process moving. He told Fox News: 'By telling our trading partners that they could boomerang back to the April 2 date, I think it's really going to move things along the next couple of days and weeks.' He told CNN: 'If you want to speed things up, have at it. If you want to go back to the old rate, that's your choice.' Japan must diversify trade ties beyond the US to mitigate the risks caused by Donald Trump's trade war, one of its opposition parties has said. Hirofumi Yoshimura, co-leader of the opposition Japan Innovation Party, said Tokyo should seek a 'win-win' situation in trade negotiations. He said the tariffs imposed by President Trump show how the US has become a source of uncertainty that could hurt Japan's economy. 'Japan should expand trade ties with countries that focus on free trade,' such as Europe, and leave itself more options to protect its economy, he told Reuters. 'Instead of standing on just one, big pillar like the US, Japan should stand on, say, five to 10 smaller pillars. That's a better approach to avoid its roof from falling off.' The views of small, opposition parties such as the Japan Innovation Party could gain importance after an upper house election on July 20, where Prime Minister Shigeru Ishiba's ruling Liberal Democratic Party (LDP) could lose its majority, according to recent polling. Elon Musk's plan to launch a new political party has reignited his feud with Donald Trump and sparked a backlash among Tesla investors. Shares in the electric car company slumped in pre-market trading on Monday morning after the US president publicly criticised Mr Musk's plans to set up the America Party. Donald Trump wrote on his social media platform Truth Social late on Sunday night: 'I am saddened to watch Elon Musk go completely 'off the rails', essentially becoming a TRAIN WRECK over the past five weeks.' The UK's government borrowing costs edged lower despite rises across Europe ahead of Donald Trump's new tariff rates. The yield on 10-year UK gilts – a benchmark for the cost of servicing the national debt – edged down to 4.54pc. However, eurozone bond yields rose as markets focused on new US tariff rates. Germany's benchmark 10-year bund yields increased two basis points to 10-year Treasuries held steady at 4.34pc. Britain has signed a trade agreement with the US which limits tariffs on the car industry, although a deal has yet to be made on steel. The European Union has prepared a package of retaliation measures if the US presses ahead with its tariff plans against the bloc. President Trump said the United States is close to finalising several trade agreements in the coming days and will notify other countries of higher tariff rates by 5pm UK time. Higher rates are expected to take effect on August 1. Donald Trump said he would put an additional 10pc tariff on any country aligning with the Brics group of nations. The alliance, which includes Brazil, Russia, India, China and South Africa, held a summit over the weekend. In a joint statement, leaders took a swipe at President Trump's trade policy, which they said 'distort trade and are inconsistent with WTO rules'. President Trump said he would impose tougher tariff on any country leaning towards 'the Anti-American policies of Brics'. He wrote on his Truth Social platform: 'There will be no exceptions to this policy.' The original Brics group gathered leaders from Brazil, Russia, India and China at its first summit in 2009. The bloc later added South Africa and last year included Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates as members. Stock markets have struggled in the run-up to Donald Trump's tariff deadline. While the White House has said several deals were in the pipeline, only two with Britain and Vietnam have been finalised ahead of the July 9 cut-off set by the US president. Governments from major trading partners including Japan, India, the European Union and South Korea have fought for the past three months to get agreements. President Trump said he will send his first tariff letters at 5pm UK time, setting out what Washington will charge for doing business with the United States. The FTSE 100 was down 0.1pc in early trading to 8,811.15, while Nikkei 225 in Japan closed down 0.6pc at 39,587.68. The Hang Seng in Hong Kong was down 0.3pc to 23,849.37 while the Cac 40 in Paris was flat at 7,694.28. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more. Sign in to access your portfolio
