Market Volatility as Trump Imposes Steel and Aluminum Tariffs

President Donald Trump's announcement of tariffs on all steel and aluminum imports has sparked a decline in commodity currencies and Asian equities, as markets remain on edge over trade tensions.

Weakened Currencies and Equities

The Australian, Canadian, and Norwegian kroners have depreciated following Trump's remarks. The benchmark index of Asian equities fell for the first time in a week, dragging down regional currencies as well. India's rupee reached a record low.

Fed Chair Powell's Testimony and Tariff Impact

Trump's announcement of a 25% tariff on steel and aluminum on Monday adds to the tense atmosphere ahead of Federal Reserve Chair Jerome Powell's semiannual congressional testimony. Investors are closely watching for Powell's assessment of the potential economic consequences of the tariffs.

Mixed Market Movements

Despite the negative outlook, futures for the S&P 500 and Nasdaq showed slight gains in Asian trading, while US Treasury yields edged down.

Elon Musk's Government Efficiency Team Findings

Trump also stated that Elon Musk's government efficiency team has identified irregularities at the US Treasury Department.

Singapore and Hong Kong Markets

DBS Group Holdings Ltd. shares surged to a record in Singapore after the Southeast Asian lender announced a dividend plan. In contrast, Hong Kong stocks outperformed the trend, with the Hang Seng Tech Index reaching its highest since October.

China's AI-Driven Optimism

Stocks of Chinese e-commerce platforms rose as Trump delayed a suspension of the de minimis exception, maintaining duty-free status for low-value packages from China. China Telecom Corp. and other telecommunications companies gained on expectations of increased investment in artificial intelligence.

Commodities and Gold

Commodities remained subdued as traders awaited further details on the implementation of Trump's tariffs. Aluminum futures declined slightly, while copper prices held steady. Gold edged upwards as investors sought safe-haven assets.

South Africa's Rand Falls

South Africa's rand weakened after the US suspended aid due to alleged human rights violations and genocide accusations against Israel. The South African foreign ministry expressed concerns about the factual basis of these claims.

Key Market Events

* China's retaliatory tariffs on US goods (Monday)
* ECB President Christine Lagarde's testimony (Monday)
* Fed Chairman Jerome Powell's monetary policy testimony (Tuesday)
* US CPI (Wednesday)
* Eurozone GDP (Friday)

Market Movements

Stocks:
* S&P 500 futures: +0.3%
* Hang Seng: +1.4%

Currencies:
* Bloomberg Dollar Spot Index: +0.2%
* Euro: -0.2% to $1.0310

Cryptocurrencies:
* Bitcoin: +1.6%
* Ether: +2.8%

Bonds:
* 10-year Treasury yield: -1 basis point to 4.48%

Commodities:
* WTI crude: +0.5% to $71.36 a barrel
* Spot gold: +0.5% to $2,875.57 an ounce