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Markets Update: The dollar strengthens as President Trump announces tariffs on steel and aluminium. Markets may see reduced potential for Federal Reserve rate cuts this year. The Nikkei remains relatively stable, while S&P 500 futures recover from initial declines.
Global Markets Roundup: 10 February 2025
Equity Markets
Global shares fluctuated, with the dollar strengthening on Monday following U.S. President Trump's announcement of impending tariffs on steel and aluminium. This move could increase inflation and potentially limit future rate cuts. The MSCI Asia-Pacific index retreated by 0.09%, while Japan's Nikkei edged up by 0.08%. South Korea's KOSPI gained 0.16% despite initial declines, although steel manufacturers experienced losses. Chinese blue-chip stocks rose by 0.3%, bolstered by data indicating a five-month high in consumer inflation. European indices showed positive futures, with the Euro Stoxx 50, FTSE, and DAX futures all posting slight gains U.S. equity futures recovered from early losses, anticipating a busy earnings week. S&P 500 futures advanced by 0.26%, while Nasdaq futures increased by 0.5%.
Currencies
The DXY index strengthened at the start of the week following President Trump's announcement of forthcoming 25% tariffs on all steel and aluminium imports into the United States, with reciprocal tariffs to be revealed shortly thereafter. This announcement bolstered the dollar against most major currencies, leading to the early under-performance of the Canadian dollar. The EURUSD briefly fell below the 1.0300 level due to the initial dollar strength and ongoing concerns about potential US tariffs on the EU. The GBP/USD traded within a narrow range around the 1.2400 mark, influenced by a lack of significant catalysts and a relatively quiet UK economic calendar at the beginning of the week, though Bank of England Governor Bailey is scheduled to speak on Tuesday with Q4 GDP data expected on Thursday. Meanwhile, the USDJPY continued its rebound from last week's lows, unaffected by rising Japanese yields. The antipodean currencies initially declined amidst tariff concerns but later recovered as the impact of the tariff news subsided.
Commodities
In the commodities market, crude futures experienced a modest increase following President Trump's tariff remarks. Gains were limited due to mixed risk sentiment and his brief comments on a conversation with Russian President Putin regarding the Ukraine conflict. Brent crude rose by $0.44 to $75.10 per barrel, while U.S. crude increased by $0.43 to $71.43 per barrel. Gold prices continued to climb, nearing last week's record highs. Despite the strengthening dollar and higher yields, gold reached $2,886 per ounce, driven partly by speculation that Trump may impose tariffs on the metal. Copper futures remained relatively stable amid mixed market sentiment, with slight gains following Trump's announcement of impending 25% tariffs on steel and aluminium imports into the United States.
In the agricultural commodities markets, CBOT futures for corn, soybeans, and wheat declined for a second consecutive session on Monday following U.S. President Donald Trump's renewed warnings about imminent tariffs, raising concerns of retaliatory measures that could negatively impact U.S. crop exports. The most active soybean contract on the Chicago Board of Trade (CBOT) decreased by 0.17% to $10.48 per bushel. Corn futures dropped 0.72% to $4.84, while wheat futures fell 0.64% to $5.79 per bushel, partly due to weak demand and ample supply from the Black Sea region, despite expectations of tighter global supply.
Looking forward refer to the economic calendar below to see the upcoming events scheduled for today and the rest of the week.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team