📉 Market Report.
📊 Last Friday, Euro zone consumer confidence fell by 0.9 points in March compared to February, according to data released by the European Commission. The flash estimate showed euro zone consumer morale worsened to -14.5 this month from -13.6 in February. The decline in consumer confidence across the euro zone and EU suggests a worsening of consumer sentiment and economic outlook in the region.
🏭 Also, British factories have reported a downturn this month, with April’s increases in tax and wages weighing on the mood. Conditions in the UK’s manufacturing sector remain subdued, with many firms reporting weak order books. The CBI’s headline industrial orders index slipped to -29 from -28 in February, well below its long-run average of -13.
💴 Japan: growing signs of sticky food inflation and prospects of sustained wage increases are likely to keep the BOJ on course to raise rates at a steady pace. BOJ Governor Kazuo Ueda warned of heightened uncertainty over how higher U.S. tariffs could affect the global economy, but signaled a rate hike at the next meeting on April 30-May 1 cannot be completely ruled out. The May 1 meeting could be a “live” one for the BOJ, as the central bank may feel the need to act on the persistent food inflation that is affecting household sentiment.
🌍 The global community is preparing for what Trump has referred to as “Liberation Day” on April 2, when he plans to implement tariffs in what seems to be a response to trade barriers imposed by other nations.
🇪🇺 The European Union has delayed its first counter-measures against the United States over President Donald Trump’s metals tariffs until mid-April, allowing it to re-think which U.S. goods to target and offering extra time for negotiations. The first set of counter-measures includes applying a 50% tariff on U.S. bourbon, which prompted a threat from Trump to slap a 200% tariff on all wines and other alcoholic products coming from the EU. The delay in the EU’s counter-measures could allow for some adjustment to the targeted U.S. goods, as France and Italy, major wine exporters, have cautioned against escalating the trade dispute.
🇺🇸 U.S. President Donald Trump has tasked his economics team with devising plans for reciprocal tariffs on every country that taxes U.S. imports, raising the risk of a global trade war. Trump signed a memo ordering his team to start calculating duties to match those other countries charge and to counteract non-tariff barriers like vehicle safety rules and value-added taxes. Potential targets include China, Japan, South Korea and the European Union. Trump said prices could go up in the short term as a result of the moves. The administration will study countries with the biggest trade surpluses and highest tariff rates first, aiming to counteract burdensome regulations, subsidies and exchange rate policies. The White House said Trump would gladly lower tariffs if other countries lowered theirs.
💰 Some European central banking and supervisory officials are questioning whether they can still rely on the U.S. Federal Reserve to provide dollar funding in times of market stress, casting doubt over what has been a bedrock of financial stability. In these discussions, officials have explored scenarios under which the U.S. government might pressure the Fed to suspend the dollar backstops, and whether they can find alternatives to the U.S. central bank. The takeaway is that there is no good substitute to the Fed, according to the sources, who include senior ECB and EU banking supervisory staff. European banks’ significant short-term borrowings in dollars make continued access to the Fed’s credit lines vital, and officials are concerned about this vulnerability.
🇬🇧 British DOGE: The UK government is aiming to reduce the size of the civil service by 10,000 roles and find £2 billion in efficiency savings. Chancellor of the Exchequer Rachel Reeves, plans to slash the number of civil servants by 10,000, as the large increases during COVID-19 are not meant to be permanent. The Labour government will stick with its plan to increase real-terms spending in every year of this parliament, but will prioritize where the money is allocated and expect departments to make efficiency savings through better use of technology like artificial intelligence. The UK’s tax collecting office already using AI to reduce fraud.
🚔 An international insider trading conspiracy: The US Department of Justice alleges that day trader Eamma Safi, Zhi Ge, and Ronald Cordas were part of a global insider trading ring that made over $17 million in illegal profits. The group used tactics like disposable burner phones, derivatives, and kickback payments to carry out insider trades on over 15 deal targets, including Principia Biopharma and Suez SA. Safi and Ge were arrested in Zurich and Singapore respectively, while Cordas has pleaded guilty and is cooperating with authorities. The investigation links the alleged insider trading to a former Merrill Lynch colleague of Khouadja’s, named François-Régis Robert, who has not been publicly charged. The group became increasingly paranoid about their activities, deleting chat histories and warning each other about the dangers of trusting Americans. The alleged insider trading ring’s largest profit was $3.8 million from trades on German biotech MorphoSys AG ahead of Novartis’ acquisition announcement.
🌎 Geopolitics:
🇬🇱 Trump still has his eye on Greenland: Second Lady Usha Vance, the wife of Vice President JD Vance, will travel to Greenland this week with a US delegation. This trip follows a recent visit by Donald Trump Jr. in January, which he described as a personal visit without any scheduled meetings with officials. The White House stated that Vance and the delegation are excited to witness the dog-sled race and celebrate Greenlandic culture and unity. Trump first considered acquiring Greenland during his first term, but was rejected by Denmark’s government at the time. Greenland has been a Danish territory since 1953. About 85% of people in Greenland oppose the idea of becoming part of the US, according to a recent poll quoted by Bloomberg, though about half viewed Trump’s interest as an opportunity.
🕊️ A U.S. delegation will meet with Russian officials today to seek progress towards a ceasefire in the Black Sea and a broader cessation of violence in the war in Ukraine. The U.S. side is being led by senior officials from the White House National Security Council and the State Department, and they met with Ukrainian diplomats on Sunday. The talks aim to reach a maritime ceasefire in the Black Sea to allow the free flow of shipping, as well as discuss issues like the line of control between Ukraine and Russia, verification measures and peacekeeping.
⚠️ According to Aleksey Arestovich, a former aide to President Zelensky, the US sees Ukraine’s leadership as “apes with a grenade” and wants to take control of Ukraine’s nuclear power facilities to offset the risks. Arestovich claims that Ukraine’s military intelligence chief Kirill Budanov proposed blowing up nuclear power plants to deny them to Russia if Ukraine started losing the conflict. Arestovich says the US knows about these plans and wants to prevent a potential nuclear catastrophe, rather than just seizing the facilities for its own benefit. He suggests the US perceives the current Ukrainian leadership as unstable and dangerous, and wants to take “dangerous toys under their control.” While President Trump claimed he discussed taking over all of Ukraine’s nuclear plants, President Zelensky said the conversation was only about the Zaporizhzhia Nuclear Power Plant.
⚖️ A Turkish court has jailed Istanbul Mayor Ekrem Imamoglu, President Tayyip Erdogan’s main political rival, pending trial on corruption charges. The decision to jail Imamoglu has inflamed the country’s biggest protests in more than a decade, with the opposition criticizing the move as politically motivated and undemocratic.
📈 Market View:
📊 Markets seem to be trying to start the week on a positive note. The Mini S&P 500 futures are up above 5,700 points, currently standing at 5,767 points. Meanwhile, the Mini Nasdaq 100 futures are also starting the week on the rise, trading above 20,000 points and currently reaching 20,165.
💵 The dollar index DXY, however, continues trapped in the narrow range of 103.25 to 104, now trading at 103.98. As for the EUR/USD pair, it is experiencing slight advances although without exceeding the level of 1.09, standing at 1.0845 at the moment.
📉 In the US bond market, there are slight upturns in pre-market yields. The 2-year bond stands at 3.98%.
📈 In Europe, stock markets open the day with gains. DAX 40 futures reach 23,260 points, very close to their all-time highs.
🛢️ On the other hand, gold futures are showing a slight moderation, reflecting the conciliatory tone in the tariff dispute and the possible ceasefire negotiations in Ukraine. Currently, the precious metal is trading at $3,028 an ounce.
⚡ The price of a barrel of Brent crude oil remains stable at over $72, standing at $72.20, while the markets await news about the breakdown of the truce between Israel and Hezbollah in the Middle East.
₿ Finally, Bitcoin showed strength again over the weekend, climbing towards $87,000, although this level seems to act as a resistance, moving slightly towards 86,825 in the last few hours.
