A look at the day ahead in European and global markets from Gregor Stuart Hunter
We are now about halfway through the most action-packed part of the week. The eye of the storm, if you will.
In case you have forgotten, today we are catching up on corporate earnings, key economic data releases, several central bank interest rate decisions, and all the latest twists and turns in trade negotiations before new U.S. tariffs kick in on Friday.
Hot off the presses: The yen appreciated 0.6% immediately after the Bank of Japan kept rates on hold as widely expected. Markets are focused on an upwards revision in inflation forecasts, with Governor Ueda due to speak shortly as traders anticipate rate hikes may be back on the agenda this year.
With second-quarter earnings season halfway complete, Nasdaq futures ripped 1.3% higher after blow-out earnings from Microsoft and Meta Platforms. The U.S. dollar held steady after hitting a two-month high, on track to tally its first monthly gain all year. [FRX/]
“It has been a great earnings season so far, and that’s the primary reason why U.S. stocks continue to do well, but the full brunt of the tariffs hasn’t been felt,” said David Chao, global market strategist for Asia-Pacific at Invesco in Singapore.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.7%, though it was still on track for its fourth consecutive monthly increase. Stocks in Hong Kong led declines, down 1.1% after official PMI gauges showed weaker-than-expected activity during July.
Copper futures plunged 19.4% after U.S. President Donald Trump said the U.S. will impose a 50% tariff on copper.
The Korean won appreciated 0.1% after Trump said the U.S. will charge a 15% tariff on imports from South Korea. The Asian country will invest $350 billion in U.S. projects and purchase $100 billion in U.S. energy products.
The announcement is the latest in a series of trade policy deals rushed out before the August 1 deadline that Trump set for trade deals before the U.S. imposes what he called Liberation Day tariffs.
Trump also issued a blitz of tariff announcements ranging from goods from Brazil to small-value shipments from overseas.
In early European trades, pan-region futures were up 0.2%, German DAX futures were up 0.2% and FTSE futures were up 0.1% ahead of another flurry of earnings and inflation data.
Key developments that could influence markets on Thursday:
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(By Gregor Stuart Hunter; Editing by Christopher Cushing)
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