Global Markets Outlook: Gold Near $3,000, Stocks Steady Amid Trump Tariffs
Gold edged closer to $3,000 per ounce overnight, briefly touching $2,942, as investors sought refuge from the volatility surrounding U.S. President Donald Trump's trade policies. Central banks and safety-minded investors have been accumulating gold for months, exacerbating concerns about tariffs on the precious metal. This has triggered a rush to move gold out of London vaults and across the Atlantic.
Equity markets largely stabilized on Tuesday after Trump indicated that Australia may be exempted from steel tariffs following a call with the Australian Prime Minister. This reinforced investor sentiment that Trump's stance is negotiable. Trump cited the U.S. trade surplus with Australia, attributing it to Australia's significant aircraft purchases. Meanwhile, markets await Jerome Powell's testimony before Congress, where he is expected to discuss inflation and tariffs. Powell will testify over two days, with his second appearance following the release of January's consumer price data. Markets have lowered their expectations for interest rate cuts this year to 38 basis points.
Electric Vehicle Market Heats Up
Intense competition is unfolding in the electric vehicle (EV) sector. China's BYD has introduced advanced autonomous driving capabilities on its models, including vehicles priced as low as $9,555, significantly undercutting rivals like Tesla. Additionally, Leapmotor, Stellantis' Chinese partner, launched an EV with smart driving technology priced below 150,000 yuan ($20,535). Tesla shares declined 3% overnight, reaching a two-month low, while Xpeng and Geely Auto shares fell in Hong Kong. Conversely, BYD's Hong Kong shares surged over 4% to a record high.
Market Events to Watch for Tuesday:
* Earnings reports: BP, Banco BPM
* Speeches: BoE's Mann and Bailey
* Jerome Powell testifies before the Senate Banking, Housing and Urban Affairs Committee