Financial markets experienced a mixed start to the week, with U.S. stock futures climbing, but the dollar wavering ahead of a week filled with key economic data, Chinese earnings reports, and the looming threat of steep U.S. tariff hikes.
Stock Futures and Currency Movements
S&P 500 futures rose by approximately 0.6% in early Asia trading, and Nasdaq 100 futures climbed 0.8%. Meanwhile, Japan’s Nikkei and Hong Kong’s Hang Seng both saw modest increases of around 0.2%.
The euro, which experienced a slight decline last week, gained 0.2% to reach $1.0835. In emerging markets, Turkey’s lira faced significant pressure due to the recent jailing of President Tayyip Erdogan’s main political rival, creating uncertainty among investors.
Shares of Australian-listed fibre-cement maker James Hardie fell by 12% after announcing its acquisition of U.S. outdoor building products company AZEK for $8.8 billion in cash and stock.
Key Events and Data for the Week
This week holds a variety of economic events, including global purchasing managers index (PMI) reports, the U.S. Federal Reserve’s preferred inflation measure, inflation data from Australia and Japan, a budget update from the UK, and major earnings reports from China.
However, it is likely that the focus will remain on U.S. President Donald Trump’s upcoming tariff plans, scheduled to be announced on April 2. These global reciprocal tariffs are expected to have a significant impact on the markets. Analysts note that after a volatile period for stocks, bonds, and currencies, there are no clear strategies to follow.
Uncertainty Surrounding U.S. Tariff Plans
“It’s very difficult to really devise a structural playbook,” said Chris Weston, head of research at Pepperstone. “You have to consider the mindset of consumers and households, especially with fears of an economic slowdown in the U.S., which has led to weeks of selling dollars and stocks, as well as a strong rally in Treasuries.”
Weston added that any factors suggesting a higher probability of recession or stagflation, or signaling that inflation pressures are not transitory, could trigger further market concerns.
President Trump has vowed to impose a complex set of tariffs next week, but details remain unclear. The tariffs are expected to account for the impact of foreign tariffs and value-added taxes on imports.
U.S. Stock Market and Global Investment Trends
Despite a modest gain on Friday, the S&P 500 showed little movement, as traders remain cautious about Trump’s tariff approach. After a turbulent first two months in office—marked by tariff impositions on China, Mexico, and Canada—investors are hesitant to bet that Trump is ready to negotiate deals.
U.S. 10-year Treasury yields have fallen nearly 40 basis points from mid-February highs, currently standing at 4.27%. Investors have also moved capital out of U.S. stocks, with sharp rallies in Hong Kong and Europe, while Wall Street struggled.
Hong Kong’s stock market has surged 18% this year, the best performance among major markets. However, a 4.4% drop over the past two sessions suggests a pause in the influx of capital as traders await further moves from both Trump and the markets.
Earnings Reports and Safe Haven Assets
Earnings reports from major companies, including automaker BYD, video platform Kuaishou, Chinese banks, and property developers, will be closely watched. In the U.S., discount retailer Dollar Tree and premium athletic wear brand Lululemon are also on the radar.
Gold remains just shy of its record high, trading at $3,021 per ounce, while Bitcoin is holding steady at $85,860.
“Cash and safe havens remain the counterbalance to any larger shift in strategy,” said Bob Savage, head of macro strategy at BNY. “We expect a series of diplomatic meetings to eventually avert extreme tariffs, but not by April, leaving concerns about Trump’s policy shifts to continue influencing markets amid ongoing economic uncertainty.”
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