US Stocks Push Higher as Investors Digest Tariffs – S&P up 0.8%
The three major US stock indices all pushed higher in trading yesterday as investors continued to digest all recent tariff updates. The Dow gained 0.78%, the S&P 0.79%, and the Nasdaq pushed up 0.64%. Treasury yields remained volatile, pulling back from recent strong gains—the 2-year losing 11.5 basis points to move back to 3.845%, and the benchmark 10-year dropping 11.6 basis points to 4.374%. The dollar remained under pressure, the DXY losing another 0.3% to close the session at 99.72. Oil prices had a quieter day than they’ve experienced over the last week or so—Brent up 0.26% to $64.93 and WTI up 0.15% to $61.59—whilst gold pulled back from Friday’s all-time high, dropping 0.82% on the day to finish at $3,209.59 an ounce.
Uncertainty the Only Certainty
The last couple of weeks have been some of the most volatile since the Covid pandemic hit markets five years ago, and investors and traders alike are now trying to piece the various (moving) parts of the puzzle together to make informed decisions. Correlations are breaking down across the board, with large percentage corrections still occurring on a daily basis, and some of the traditional haven trades have suffered—particularly US-focused (i.e., the dollar and treasuries)—whilst others, e.g., gold, JPY, and CHF, have flourished. Sadly, at the moment, uncertainty very much rules the roost, and until we get some sort of consistency on what will actually be implemented in terms of tariffs and any counter-tariffs, we will continue to see volatile markets. It appears that non-US havens will continue to appeal.
Event Calendar Kicks into Action Today
The macroeconomic event calendar kicks into action today with some key data and central bank updates due out across the trading sessions, which will add some fundamentals to the geopolitical updates that have been rocking markets. The Asian session will see a focus on Australian markets, with the Reserve Bank of Australia’s Monetary Policy Meeting Minutes due out early in the session. We have some key data due out of the UK early in the European session today—employment data is due out, with the Claimant Count expected to show an increase of 30k fresh claims, with the unemployment rate remaining steady at 4.4%. We also have key data due out shortly after the New York open, with the focus on Canadian markets and the latest CPI print. The headline month-on-month number is expected to show a 0.7% increase, with the median year-on-year data coming in at +2.9%. We also have the Empire State Manufacturing Index due out in the US at the same time to kick off US data for the week.
