Stocks edge up as markets steel themselves for tariff decision

In antipodean currencies, aussie/dollar and kiwi/dollar retreated to 0.7800 (-0.29%) and 0.7263 (-0.29%) respectively on the back of potential trade risks as Australia and New Zealand are highly exposed to commodity prices which would get into a bearish run if the United States tariff measures materialize. It had weakened on Wednesday to C$1.3002 CAD=D4 on Wednesday before recovering on the prospect that Trump's tariffs may exempt Canada and Mexico. Technology shares paced gains.

The accompanying production figures were also upbeat as industrial output was shown to have rebounded from -1.3% to 1.3% at the start of year, although fell slightly behind forecasts it would strike as high as 1.5%. WTI crude traded at $61.30/bbl and Brent crude was around $64.30/bbl.

"Investors have to take a deep breath and watch what the reality is".

US President Donald Trump is set to formally declare tariffs on imported steel and aluminium as early as Thursday, according to his main trade adviser Peter Navarro.

Indeed, for all of the well-founded optimism around the euro zone's economic boom since late past year, the European Central Bank is no doubt more anxious than it can possibly let on that forward-looking indicators suggest it may already be slowing.

During the subsequent European Central Bank press conference, Draghi was able to tone down any hawkishness in the statement in his responses to questions from the assembled group of journalists.

"Under normal circumstances the ECB decision would not be a risk event as the central bank is expected to stand pat on policy".

BOJ monetary policy decision and briefing on Friday.

"An escalation of trade wars would lead to greater political uncertainty and a weaker U.S. dollar".

The EUR  USD 1 Minute Versus 1 Month ECB Response

MSCI's gauge of stocks across the globe gained 0.45 percent, and the pan-European FTSEurofirst 300 index rose 1.02 percent. Euro bulls capitulated and by mid afternoon in Europe on Thursday, the single currency was down 0.62% versus the dollar to $1.2334.

The MSCI Emerging Market Index gained 0.4 percent to the highest in more than a week. AB Foods rose 0.7 per cent following an upgrade to "buy" from Goldman Sachs on expectations a weak dollar would underpin its profit recovery.

The Japanese yen dropped 0.2 percent to 106.25 per dollar.

On the currency markets the dovish message won out.

Portugal's 10-year bond yield fell to a six-week low at 1.81 percent PT10YT=RR , while Spanish 10-year bond yields hit a one-month low at 1.41 percent. In the USA, the 10-year Treasury yield hovered around 2.86%.

The inflation forecast for this year was maintained at 1.4 percent, while the outlook for next year was trimmed to 1.4 percent from 1.5 percent.

Brent crude prices dropped almost 1% to $63.90 per barrel as investors continued to bemoan data released by the Energy Information Administration a day earlier which showed a further rise in USA crude inventories.

To contact the reporter on this story: Randall Jensen in NY at

  • Zachary Reyes