US Markets Down Again as Tariff Concerns Persist – Nasdaq Down 4.3%
US markets took another sharp downside correction in trading yesterday as investors continued to evaluate the growing global trade war. All three of the major US indices dropped hard, the Dow off 2.50%, the S&P down 3.46% and the Nasdaq down 4.31%. The dollar crashed against all the major currencies as FX players priced in more pain for the US, the DXY down 1.95% on the day to 100.98. Treasury yields were mixed again after lower inflation data in the US, the 2-year down 4.6 basis points to 3.862%, while the 10-year gained 9.3 basis points to 4.425%. Oil prices dropped back again, Brent down 3.13% to $63.43, WTI down 3.66% to $60.07 a barrel. Gold flew higher again on haven flow, notching another all-time high, gaining 2.49% on the day to close at $3,176.64.
Gold Shines Again in Uncertain Times – Up 2.5%
Gold once again hit a fresh all-time high yesterday as the euphoria of President Trump’s tariff reprieve fell flat after just one day. Traders are now looking at more uncertainty in the market as the US President continues to change his mind on trade issues, and gold has been the recipient of large haven flows. As the dollar continues to drop in the wake of a pending US recession, gold becomes more attractive from a portfolio perspective and investors continue to look for levels to buy. The world’s favourite precious metal is now up nearly 23% since its 2025 low on the very first trading day of the year, and if the global trade war continues, it is set to move even higher. Investors now feel that only a complete turnaround from the US in terms of tariffs will enable a good correction for gold, and while the uncertainty and risks continue to pile up, they will continue to buy haven products, with gold at the top of their list.
More Data on the Calendar Today
There is more data due out today on the economic calendar, but traders are expecting geopolitical concerns to once again outweigh fundamental updates. There is nothing of note due out in the Asian session, but the focus will be firmly on the UK once Europe opens, with several data drops scheduled, the GDP data being the highlight. Expectation is for the data to show a meagre 0.1% month-on-month increase, and anything significantly off that will see more moves in the pound. Once again, we have big data coming out in the US shortly after the New York open, with PPI numbers set to be released. The core number is expected to show a 0.3% increase, while the headline figure is expected to be slightly lower at 0.2%. Later in the day, we also have University of Michigan Consumer Sentiment and Inflation Expectations data, and the week will be closed out with speeches from Fed members Musalem and Williams.
