Morning Bid: Data deluge rounds up turbulent April
Note: There will be no Morning Bid Europe on Thursday, May 1, due to holidays in various markets. The newsletter will resume on Friday, May 2.
There will be a raft of data for investors to pore over on Wednesday as they wind down a rollercoaster month headlined by a tumultuous trade policy in the United States that bruised markets and dealt a blow on businesses and consumers globally.
First up in Europe, preliminary readings on French and German inflation are due, alongside growth data for the two economies and the wider euro zone bloc. The UK also releases figures for home prices.
It remains to be seen if the releases will support the case for further rate cuts by the European Central Bank (ECB), but for now markets are leaning toward another round of easing in June.
Two ECB policymakers warned earlier this week that a trade war with the United States could extinguish the euro zone's fledgling recovery and the bloc could struggle under tariffs.
U.S. GDP data and the core PCE price index then take the stage, where expectations are for the world's largest economy to have grown a meagre 0.3% in the first quarter.
As it is, data on Tuesday showed the U.S. trade deficit in goods widened to a record high in March as businesses ramped up efforts to bring in merchandise ahead of the sweeping tariffs, suggesting trade was a large drag on growth.
It's a lot for investors to digest at the end of the month, having already been taken on a wild ride following U.S. President Donald Trump's first 100 days in office. But chaos seems to be the new normal these days.
There was little to cheer about in markets on Wednesday, as relief over a potential easing of global trade tensions was offset by a worsening economic outlook and dour signals from corporates swept up by Trump's tariffs.
Despite Trump's move to soften the blow of his auto tariffs and signs of progress in broader trade negotiations, details remain scant, with Commerce Secretary Howard Lutnick saying he had reached one deal with a foreign power.
Delivery giant UPS said on Tuesday it would cut 20,000 jobs to lower costs, while General Motors pulled its outlook and delayed its investor call, joining a list of companies that have ditched forecasts for 2025 or slashed outlooks.
Shares struggled for direction and U.S. futures slid, while the dollar was on track for its worst monthly performance in more than two years.
While a fire sale of U.S. assets that gathered steam earlier this month seems to have abated for now, confidence remains fragile and the recent slew of economic data has given investors little reason for them to return.
U.S. consumer confidence slumped to a nearly five-year low in April and job openings dropped sharply in March, in signs that cracks in the economy are starting to show.
Amid persistent Sino-U.S. trade tensions, the world's second-largest economy is starting to feel the heat too.
China's factory activity contracted at the fastest pace in 16 months in April, a survey showed on Wednesday, as Trump's hefty tariffs snapped two months of recovery.
Still, Beijing is betting on Washington blinking first in a protracted trade war, as officials advance this year's stimulus plans but hold off on fresh measures.
Key developments that could influence markets on Wednesday:
- French, German preliminary inflation (April)
- Euro zone, France, Germany preliminary GDP (Q1)
- UK nationwide house prices (April)
- U.S. advance GDP (Q1)
- U.S. core PCE price index (March)
Trying to keep up with the latest tariff news?
Our new daily news digest offers a rundown of the top market-moving headlines impacting global trade. Sign up for Tariff Watch here. (This story has been refiled to correct the day of the week to Wednesday from Thursday in paragraph 8)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Bloomberg
31 minutes ago
- Bloomberg
ECB Urged to Target Banks Trailing on Climate
The European Central Bank should impose greater so-called haircuts on the debt of banks most exposed to climate risk, in a move that would impact the funding costs of environmental laggards. That's according to the Anthropocene Fixed Income Institute, which has been scrutinizing the ECB's support of polluting bond issuers for years. The central bank has announced it will start applying climate-risk penalties to corporate bonds used as collateral in transactions starting in the second half of next year.
Business Insider
an hour ago
- Business Insider
Parts of Europe are suspending postal shipments to the US — and your order may not arrive
Postal services operated by Norway, Sweden, Denmark, and Belgium — Posten Bring, PostNord, and bpost — said they will suspend parcel shipments to the US ahead of the end of a customs exemption that allows low-value packages to enter the country duty-free. The conundrum facing postal operators comes as the Trump administration prepares to suspend the " de minimis" exemption starting on August 29. The exemption used to allow international shipments under $800 to cross the border with minimal paperwork and no duties. Now, these shipments will face tariffs, and not every operator can handle the customs declaration paperwork, have a payment mechanism in place, or be responsible for returns should a receiver refuse to pay tariffs. It's unclear when the temporary freeze on shipments will resume. "Due to the short timeframe to adapt to the new specific requirements, PostNord will temporarily halt shipments to the United States and Puerto Rico until a compliant solution has been developed and implemented," wrote the operator owned by the Swedish and Danish governments in a statement on Wednesday. Separately, Posten Bring, Norway's primary postal provider operated by the government, said in a statement that postal services have not been given clear instructions and solutions on how the duties will be paid or who would be responsible for returns. Therefore, Posten Bring sees suspension as the "only option." All three European postal services will suspend shipments starting August 23, which applies to all packages other than letters. This means that if you have a pending purchase that is not shipped by the deadline, your seller may need to cancel your order or arrange alternatives. But even if you're not purchasing from these specific European countries, your shopping options might still dwindle and become more costly. Etsy, the US e-commerce giant and a hub for independent crafters, posted a notice Wednesday that shipping label purchases for Australia Post, Canada Post, Evri, and Royal Mail for US-bound packages will be temporarily suspended starting August 25. Etsy wrote in a statement that these operators are unable to support prepaid duties at the moment, which may result in a large number of rejected packages due to unpaid duties and surprise costs for buyers not listed at checkout. Across social media platforms, many independent sellers based in the UK are also announcing that they can no longer support orders to the US, citing the introduction of an $80 flat fee plus handling charges for using Royal Mail to ship parcels to the US. "We hope to resume shipping as soon as we can, but we really don't want our customers to be hit with an $80+ fee," wrote the Citrine Circle, a UK-based crystal shop, on Instagram. "It feels like the world is getting smaller and smaller."
New York Times
an hour ago
- New York Times
How Trump Is Forcing Foes to Pay Up
Seven months into the second Trump administration, the president has picked fights with colleges, law firms, trading partners and private businesses, threatening them with investigations, tariffs or other consequences as he seeks to enact his agenda. And he has also offered them a simple way out of their Trump-instigated troubles, one that would hardly seem out of place in the clubby, mob-connected Manhattan he came up in: Pay up. And so they are. One by one, the president's foes — and even some of his purported allies — are agreeing to spend big on his terms, either so they can go about their business or avoid something worse. Some of the president's critics see it as nothing less than extortion. New reporting from my colleagues shows that Trump personally interceded as his aides negotiated with Columbia University, insisting they secure a $200 million payment on top of the policy changes it had already committed to make. And it's not just Columbia. Other colleges: Brown University agreed to pay $50 million to state work force development programs to keep its government funding in place, and an emerging agreement between Harvard and the government could see the university spending $500 million in a bid to maintain its federal funding and make a litany of federal investigations go away. Trading partners: The president has urged trading partners to show him the money in the form of investments as a way to avoid steeper tariffs, something my colleague Alan Rappeport described as directly injecting his 1987 autobiography, 'The Art of the Deal,' into trade policy. ('The dollar always talks in the end,' Trump and his co-author Tony Schwartz wrote in that book, which helped propel Trump to new heights of fame and cement his business-savvy image.) Private companies: The Trump administration said it would issue licenses to two companies wishing to sell A.I. chips in China, Nvidia and Advanced Micro Devices, only after those businesses took the unusual step of agreeing to give the federal government a 15 percent cut of those sales. It was a highly unusual agreement, my colleague Tripp Mickle wrote, but one the companies felt they had no choice but to make. The administration is also discussing taking a 10 percent stake in Intel, the struggling chip-maker, Tripp and Lauren Hirsch reported this week. Law firms: Elite law firms ponied up nearly $1 billion in pro bono legal services after they were targeted with punitive executive orders or other threats. Trump has hinted that he'll draw on it as a kind of personal legal war chest, and my colleagues reported today that two of the firms are said to be doing free work for the Commerce Department. It is not unusual for the federal government to reach settlements with entities it has investigated as they seek to avoid trials or other drawn-out proceedings. But it is unusual for a president to personally — and sometimes publicly — push for such payments himself with the full force of the federal government behind him. The approach, however, is consistent with the highly personalized and transactional approach Trump honed over his decades in New York. To him, leverage was everything, money is power — and he always looked for a way to come out on top. Want all of The Times? Subscribe.
