Evolution of the international financial markets and evaluation of the main events and economic indicators of the previous day session. Available in English.
US President Trump announced a 90-day pause on the so-called “reciprocal" tariffs for all targeted countries, but still maintained the 10% general tariff rate and raised the tariff rate for China to 125% after both countries’ authorities escalated the tension. US stocks rallied and the S&P had its largest intraday gain in over 17 years (+9.5%).
Tuesday saw another volatile session in the financial markets. Risk appetite rebounded from the Asian session on hopes of Trump's willingness to negotiate tariffs with some partners, which extended into the European session and the start of the US session. Asian and european stocks rose and while eurozone government bond yields rose slightly.
Yesterday marked the third consecutive session with an intense risk-off mode and high volatility in financial markets amid heightened tariff uncertainty and ongoing fears of a global economic slowdown. In this context, sovereign bond yields increased on both sides of the Atlantic, with euro area peripheral risk premia edging higher.
Financial markets continued on a risk-off mode during Friday's session, as investors tried to assess the potential consequences of China retaliating on US tariffs, enacting duties on all US imports and export controls on rare earths. In this context, US sovereign yields fell, as investors expected the Federal Reserve will cut its intervention rate twice by July.
So-called 'Liberation Day' tariffs announced by the Trump's administration on Wednesday evening had a substantial negative impact on financial markets during yesterday’s session. From a minimum 10% tariff on all countries, up to an accumulated tariff over 50% on China, investors began to price in slower growth as global trade starts to adapt to the tariffs shock.
Yesterday all eyes were on Trump's tariffs announcement, which took place after US markets had closed. Trump finally set tariffs close to the worst expectations, with a 34% tariff for China, 20% for the EU and 24% for Japan. Asian equities are down at today's session (Nikkei around -3%), while stock index futures for Europe and the US point to similar losses.
Risk appetite recovered somewhat yesterday. In a volatile session ahead of today's announcement by Trump of reciprocal US tariffs on virtually every other country in the world, investors assessed a series of price and activity data as increasing the chances of rate cuts.
Investors started the week in a cautious mood awaiting Trump's comprehensive tariff announcements due on Wednesday.
Markets ended the week in a risk-off mode as investors focused on Trump's announcement due on Wednesday of a tariff hike that seeks to match tariffs on US products in other countries.
In yesterday’s session, investor concerns over the impact of the trade war intensified after Donald Trump announced that all finished automobile imports will be subject to a 25% tariff from next Thursday. Global equity markets recorded losses, with major automakers experiencing significant share drops.
Generalized risk-off sentiment during yesterday's session following news that President Trump would impose tariffs on the automotive sector by the end of the day, which he finally did (25% on all finished auto imports). Stock markets fell sharply on both sides of the Atlantic, dragged lower by industrial stocks. The dollar strengthened to $1.07 against the euro.
Investors traded cautiously amid heightened tariff uncertainty, fresh rounds of talks between Russia and Ukraine, and mixed macro data. In the US, the Conference Board Consumer Confidence index fell to its lowest level since 2021, while the German Ifo business climate index rose, as companies' expectations about the future improved.