Trump's New Tariff Threats Shake Global Markets as EU and Mexico Brace for Impact
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Japan's Nikkei lost 0.3% as profit-taking weighed. Chinese blue chips added 0.3% after data showed exports rose a more-than-expected 5.8% in June, even if in dollar terms the U.S. shipments showed a near 10% fall. MSCI's broadest index of Asia-Pacific shares outside Japan barely budged.
Data on China's GDP, retail sales, and industrial output that are expected on Tuesday will probably provide additional cues.
Europe and Wall Street Futures Drop
European markets reacted more strongly. Futures on the EUROSTOXX 50 dropped 0.6%, Germany's DAX futures shed 0.7%, and FTSE futures slipped 0.1%. The EU said it would temporarily hold off on countermeasures until early August, while Germany's finance minister warned of firm action if talks failed.
Futures on the S&P 500 and Nasdaq fell 0.4% each. Earnings season begins this week with major banks reporting Tuesday. Analysts expect second-quarter earnings to rise 5.8%, although estimates have been revised down from 10.2% in April.
Analysts at Bank of America anticipated that earnings would beat expectations by about 2%, less than the average of 3% and the 6% they reached last quarter.
Pressure Builds on Powell as Tariff Clock Ticks
Bond markets were steady. The U.S. 10-year yield steadied at 4.41%, and the Fed funds futures implied a little more easing over the next year. President Trump is turning up the heat on Jerome Powell, who is the chairman of the Fed, to cut rates more deeply.
White House adviser Kevin Hassett even suggested Powell could be ousted over remodeling overruns at the Fed's headquarters. Trump would later say Powell stepping down would be "a great thing."
The euro, meanwhile, was down 0.1% at $1.1685, and the dollar fell 0.2% versus the yen. The Mexican peso declined by 0.2% as the markets digested Trump's threat, but President Sheinbaum expressed confidence that a deal would be made.
Gold was up 0.1% at $3,359 an ounce, while the oil price rose on speculation that the U.S. may impose sanctions on Russian oil. Brent crude was up 0.2 percent at $70.47, and U.S. crude was 0.1 percent higher at $68.55 a barrel.
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3 hours ago
- CNA
France eyes holiday cuts to slash debt burden
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