Global Markets on Edge as Trump’s Tariff Blitz Shakes Trade and Commodities
Markets are navigating a high-stakes week filled with major corporate earnings, economic data, and central bank decisions, all while preparing for a critical Friday deadline when new U.S. tariffs are set to take effect. The uncertainty is driven largely by former U.S. President Donald Trump’s aggressive trade stance, which includes a wave of new tariffs that threaten to disrupt global supply chains and investor sentiment.
The Bank of Japan held interest rates unchanged, as anticipated, but an upward revision in inflation forecasts sparked speculation that hikes could return later this year. The yen appreciated by 0.6% following the announcement, with markets awaiting remarks from Governor Ueda that could further clarify the central bank’s future stance.
On the corporate front, blowout earnings from Microsoft and Meta sent Nasdaq futures up 1.3%, highlighting investor confidence in big tech’s resilience. Despite concerns about upcoming tariffs, U.S. equities have remained buoyed by strong quarterly results, with strategists attributing the ongoing rally primarily to robust corporate performance rather than macroeconomic factors.
In Asia, markets stumbled. The MSCI Asia-Pacific Index fell 0.7%, dragged down by a 1.1% drop in Hong Kong stocks after disappointing PMI data. Copper futures plunged nearly 20% after Trump announced a steep 50% tariff on copper imports. Additional levies, such as a 15% tariff on South Korean imports, are contributing to regional volatility, even as South Korea commits significant investments in the U.S.
European futures showed mild gains in early trade, with investors preparing for another round of key earnings reports and inflation data. U.S. and European corporations like Apple, Shell, and Unilever are in focus, alongside crucial economic indicators from Germany and France. Meanwhile, Trump’s sweeping tariff announcements—including new levies on Brazilian goods and low-value imports—continue to stoke fears of a global trade escalation just ahead of his August 1 deadline.
Source: Reuters