Tech Stocks Hammered on Tariff Update – Nasdaq Down 2.8%
US tech stocks took a hammering in trading yesterday as President Trump announced that tariffs will proceed in March, while Nvidia delivered a weaker-than-expected forecast in its quarterly update. The Nasdaq led the decline, closing 2.78% lower, followed by the S&P, which fell 1.59%, and the Dow, which closed 0.45% down.
The dollar surged on the tariff news, with the DXY gaining 0.67% on the day to reach 107.24. Meanwhile, treasury yields were more muted, with the 2-year yield rising just 0.3 basis points to 4.075% and the 10-year increasing by 2.8 basis points to 4.283%.
Oil prices jumped after President Trump revoked Chevron’s operating licence in Venezuela, with Brent crude rising 2.08% to $74.04 per barrel and WTI climbing 2.54% to $70.35. Gold fell in line with the stronger dollar and profit-taking flows, dropping 1.68% on the day to $2,867.63.
Dollar Leaps Back into Favour
The dollar recorded its strongest increase in two months yesterday as President Trump confirmed that tariffs would go ahead as planned in the coming days. The DXY surged 0.7%, climbing from near 106.50 to above 107.25, pushing several major currencies towards recent lows after having only recently hit annual highs.
Geopolitical developments were the key driver yesterday, but the focus will soon shift to fundamentals, with a crucial US inflation update due early in the New York session. If inflation data exceeds expectations and reinforces concerns about tariff-induced price pressures, the dollar could rise further and more aggressively.
Inflation Data in Focus Today
Traders and central banks will be closely watching inflation data updates today, with key figures set to be released across all three trading sessions.
In the Asian session, attention will be on Japanese markets as the Tokyo Core CPI data is released early in the day, with markets expecting a 2.3% year-on-year increase. The London session will see the release of German preliminary CPI data, with figures arriving throughout the morning as individual states report separately.
However, the main event will come with the opening of New York markets, when the Federal Reserve’s preferred inflation gauge, the PCE Price Index, is released. Markets anticipate a 0.3% increase, and the result is expected to dominate sentiment. Canadian GDP data will be published at the same time, but the US figure is likely to take precedence. Later in the session, the Chicago PMI numbers are also due, but again, the PCE data is expected to be the key market mover—especially if it deviates from expectations.
