02.04.2025 10:42
Global markets are showing a mixed trend due to ongoing uncertainties regarding the tariffs expected to be announced by U.S. President Donald Trump today.
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Global markets are experiencing a mixed trend due to ongoing uncertainties regarding the tariffs expected to be announced by U.S. President Donald Trump today. The economic and trade policies pursued by U.S. President Donald Trump under his "America First" policy continue to be a source of uncertainty globally.
"ONE OF AMERICA'S MOST IMPORTANT DAYS"
White House spokesperson Karoline Leavitt stated at a press conference that the tariffs would take effect immediately after their announcement, saying, "April 2, 2025, will go down in history as one of the most important days in modern American history." Analysts noted that these developments have complicated pricing, and the flow of news regarding Trump's policies is at the forefront of investors' minds. While statements from Federal Reserve (Fed) officials are also being monitored, Chicago Fed President Austan Goolsbee warned that the comprehensive tariffs to be introduced under the Trump administration could lead to a resurgence in inflation or an economic slowdown. Goolsbee mentioned that imports account for only 11% of the U.S. economy, and therefore the overall impact of tariffs on prices could be limited. However, he emphasized that if tariffs increase production costs or lead to economic uncertainty among consumers and businesses, it could pose a greater risk. Goolsbee stated, "The concern is that this goes beyond that 11% area. If consumers stop spending or businesses refrain from investing due to uncertainty and fear, it could become a somewhat complicated situation."
FED'S JUNE INTEREST RATE CUT IS BEING DISCUSSED
In the pricing of money markets, the Fed is expected to cut interest rates with an 83% probability in June, while concerns that tariffs could negatively impact the economy have strengthened expectations for a total of three interest rate cuts by the bank by the end of the year. On the other hand, Trump signed an executive order to establish a new office aimed at accelerating investments in the country. In this context, it is aimed to facilitate the work of individuals who will invest $1 billion or more in the U.S. and to assist foreign and domestic investors.
U.S. 10-YEAR TREASURIES RISE
On the macroeconomic data front, the Institute for Supply Management (ISM) manufacturing Purchasing Managers' Index (PMI) in the U.S. fell to 49 in March, below market expectations, indicating a contraction in the sector. The number of job openings in the JOLTS report also declined to 7.568 million in February, falling short of forecasts. Due to uncertainties regarding Trump's tariff actions and the Fed's monetary policy roadmap, the yield on U.S. 10-year treasuries, which had fallen to 4.16% over the last three trading days, rose to 4.20% yesterday.
OIL ABOVE $74
Supported by global risks and central bank purchases, the price of gold per ounce tested $3,149 yesterday, while currently finding buyers at $3,126, up 0.4% from the previous close. The dollar index remains flat at 104.2, while the price of Brent crude oil is trading just above the previous close at $74.3. In the New York Stock Exchange yesterday, the S&P 500 index rose by 0.38%, the Nasdaq index by 0.87%, while the Dow Jones index remained flat. In the U.S., index futures contracts started the new day with a negative trend. European stock markets were positive yesterday, while attention turned to the tariffs to be announced by Trump and the statements of European Central Bank (ECB) President Christine Lagarde.
EUROPE SIGNALS RETALIATION TO THE U.S.
European Commission President Ursula von der Leyen stated that they are ready to retaliate strongly against the U.S. tariffs. Reminding that the U.S. administration has announced a 25% tariff on steel, aluminum, automobiles, and auto parts imports, von der Leyen noted that the next sectors to face tariffs would be semiconductors, pharmaceuticals, and timber. Emphasizing that implementing tariffs would worsen business conditions, von der Leyen said, "Tariffs are taxes that will be paid by the public. Tariffs will only fuel inflation." She stated that the first element of the EU's strategy against tariffs is negotiation and that they want to discuss these issues. In macroeconomic data, annual inflation in the Eurozone fell to 2.2% in March, while unemployment decreased to 6.1% in February. Yesterday, the DAX 40 in Germany rose by 1.7%, the CAC 40 index in France by 1.1%, the FTSE 100 index in the UK by 0.61%, and the FTSE MIB 30 index in Italy by 1.33%. In Europe, index futures contracts started the new day with a mixed trend.
CHINA'S CONDITIONAL RESPONSE
While Asian stock markets are showing a mixed trend, the potential effects of Trump's tariffs are impacting regional equity markets. Bank of Japan (BoJ) Governor Kazuo Ueda warned that the tariffs to be implemented by the U.S. administration could have a significant impact on global trade, expressing his desire to discuss the effects of tariffs on the global economy with his counterparts at the G20 finance ministers' meeting to be held in Washington this month. Ueda stated, "The impact of the U.S. tariff policy on the global economy is quite uncertain. However, depending on the scope and scale of the tariffs, it could have a significant impact on the trade activities of each country." Chinese Foreign Minister Wang Yi stated that discussions with the U.S. are contingent upon the removal of tariffs. With these developments, the Nikkei 225 index in Japan rose by 0.4% near the close, while the Shanghai Composite index in China rose by 0.1%, and the Kospi index in South Korea fell by 0.7%, and the Hang Seng index in Hong Kong fell by 0.1%.
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