Morning bid: Risk assets trampled as Trump touts tariffs for all

Reuters

Sun, Mar 30, 2025, 10:34 PM 2 min read

A look astatine the time up successful European and planetary markets from Wayne Cole

It's been a rocky commencement to the week successful Asia arsenic a unreserved from hazard near stocks down crossed the board, portion bonds extended their rally and golden roseate to different record.

Sentiment was fragile capable up of the announcement of U.S. tariffs connected Wednesday but President Trump made it much truthful by telling reporters connected Air Force One that the levies would screen each countries and not conscionable a prime few. He has a wont of dropping these comments aboriginal successful the Asia trading time erstwhile liquidity is lacking, and sets disconnected large waves arsenic a result.

The Nikkei led the rout with a autumn of 3.8%, the largest regular driblet successful six months, and beauteous overmuch each of Asia was successful the red. Nasdaq futures shed 1.3% and the large European banal futures followed.

Trump's new-found indifference to rising car prices seemed to person analysts helium was superior astir going each in. Goldman Sachs present expects reciprocal tariffs volition mean 15% crossed each U.S. trading partners. In the aforesaid note, it lifted the accidental of a U.S. recession to 35%, from 20%, and the "R" connection seems to beryllium connected everyone's lips.

Investors are counting connected this coming slowdown to outweigh the inflationary interaction of tariffs and prod the Fed into cutting rates by 75 ground points this year, though it would apt instrumentality a crisp emergence successful unemployment to warrant specified action. Markets person astir 60 bps of ECB easing priced successful for this twelvemonth and 50 bps for the Bank of England.

The thought of each this easing, combined with the formation to safety, offered comfortableness to enslaved investors. Ten-year Treasury yields fell to 4.21% from a apical of 4.40% past Thursday. It's an unfastened question whether this rally volition proceed erstwhile the existent ostentation information commencement showing the interaction of tariffs connected prices.

For now, little yields person dragged the dollar down connected the yen, and adjacent the euro and lb person edged higher. Yields aside, though, it whitethorn go harder for the dollar to get its accustomed boost arsenic a harmless harbour erstwhile the root of each this turbulence is the White House itself.

Key developments that could power markets connected Monday:

- Data connected German retail sales, CPI and import prices

- Speakers from the Riksbank and Norges Bank

- Dallas Fed manufacturing survey for March

(By Wayne Cole; Editing by Edmund Klamann)