The Dollar Surges as Trump's Tariff Plan Jolts Markets

Amidst President Donald Trump's announcement of steel and aluminum import tariffs, the US dollar strengthened and gold reached record highs on Monday. US stock futures indicated a rebound from Friday's decline.

Major Currencies and Commodities

The Bloomberg Dollar Spot Index rose to a near-week high, with the yen and Canadian dollar bearing the brunt of the greenback's strength. Gold climbed as investors sought safe haven assets in response to Trump's latest trade threats.

Equity Markets

S&P 500 and Nasdaq 100 futures contracts advanced by over 0.5%. American metals stocks surged, with United States Steel Corp. and Alcoa Corp. experiencing notable gains. McDonald's Corp. reported higher fourth-quarter sales, leading to a rise in its shares. In Europe, BP Plc shares soared on news of an investment stake by activist investor Elliott Investment Management.

Trade Tariffs and Fed Testimony

Trump's planned 25% tariffs on steel and aluminum increased market volatility and added to the tense sentiment ahead of Federal Reserve Chair Jerome Powell's semiannual congressional testimony. Trump stated the tariffs would apply to imports from all countries, but did not specify their effective date.

Key Events and Economic Data

China's retaliatory tariffs on US goods are scheduled to take effect on Monday. Powell's monetary policy testimony on Tuesday will be closely watched by investors. This week will also see the release of US CPI data and other economic indicators that could provide insights into the Fed's rate cut expectations.

Commodities and Other Markets

European natural gas prices reached a two-year high as cold temperatures depleted storage. Aluminum futures remained steady, pending further details on the tariffs. Copper prices showed little change. Bitcoin and Ether cryptocurrency values increased.

Market Movements

* S&P 500 futures: +0.5%
* Nasdaq 100 futures: +0.8%
* Dow Jones Industrial Average futures: +0.5%
* Stoxx Europe 600: +0.5%
* Bloomberg Dollar Spot Index: +0.2%
* Bitcoin: +2.4%
* Gold: +1.5%