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Slow start to the week for markets

US equity markets moved little to start the week while Asian markets were mixed on Tuesday with little macroeconomic or geopolitical news to sway sentiment decisively. Treasury yields kept equity gains in check while industrial metals were up on hopes of a global manufacturing rebound. Wednesday, US inflation data could provide an impulse for markets by showing how quickly the Federal Reserve (Fed) is moving towards its 2% inflation target and, consequently, how quickly markets can expect interest rate cuts.

Shane Strowmatt, LGT
Tempo di lettura
5 minuto
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In New York, stock indices struggled to find direction with higher yields preventing gains in equities. The yield on 10-year Treasuries traded over 4.46% and yields on 2-year US government debt traded near 4.79% on Monday. The Dow Jones Industrial, S&P 500 and Nasdaq-100 all finished Monday’s session with marginal losses as there was a lack of macroeconomic releases or company news to move markets significantly.

In the Asia-Pacific region, stock markets were trading mixed on Tuesday. In Tokyo, the Nikkei 225 was leading gains, up 0.8%. South Korea’s Kospi was the biggest loser, down 0.2%. Australia’s S&P/ASX 200 gained 0.6%. Hong Kong’s Hang Seng Index was trading up 0.6%, while the Shanghai Composite was down 0.2%.

In commodities, copper futures were up around 1% early Tuesday, trading near a two-year high. Other industrial metals were also up as traders looked ahead to a possible rebound in global manufacturing this year. Silver was trading near USD 28 on Tuesday, rising from around USD 22 per ounce in early February.

In Europe, the Sentix economic index for the euro area continued to increase for the sixth month in a row in April, reaching the highest level since the outbreak of the war in Ukraine. The level of -5.9 points signals a slow stabilising of the euro-area economy. The Euro Stoxx 50 gained 0.4%, Germany’s DAX was up 0.8% and France’s CAC 40 finished Monday’s session up 0.7%.

The unemployment rate in Switzerland remained unchanged in March at 2.4%, according to the State Secretariat for Economic Affairs (SECO). The number of unemployed people increased by 15,838 when compared with the previous month but remained at historically low levels. In 2023, the average monthly unemployment rate was 2%, the lowest level in more than 20 years. Switzerland’s SMI stock index was up 0.5% on Monday.

The ongoing trade war between the world’s two largest economies heated up on Monday with US Treasury Secretary Janet Yellen refusing to rule out tariffs on subsidised clean energy products out of China. The subsidised green products damage local producers in the US, according to Yellen, and could be the administration’s next possible target for restrictive trade measures. The US government has been ramping up tariffs and restrictions on Chinese goods since the administration of former US president Donald Trump. Trade disputes between the US and China in 2023 centred around restrictions on microchip exports to China, particularly those used in artificial intelligence. Tariffs and other restrictions on imports of green energy products out of China could benefit Western producers.

Corporate news in focus: There is no major corporate news scheduled today.

Economic data in focus: Dutch Consumer Price Index, French trade balance, euro area bank lending survey.


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Editor: Alessandro Fezzi
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