Stocks Drop, Dollar Gains on Tariff Worries
Key Points:
* Stocks decline amid concerns over global economic growth and inflation due to impending US tariffs.
* S&P 500 falls by 1.5%, with carmakers and semiconductor companies particularly impacted.
* Dollar strengthens against major currencies, led by a 1.3% decline in the Mexican peso and a 0.9% drop in the Canadian dollar.
* Treasury yields experience a flattening curve, with short-term rates climbing and long-term rates falling, pointing to potential stagflation.
Market Movements:
Stocks:
* S&P 500: -1.5%
* Nasdaq 100: -1.8%
* Dow Jones Industrial Average: -1.1%
* Stoxx Europe 600: -1.3%
* MSCI World Index: -1.8%
Currencies:
* Bloomberg Dollar Spot Index: +0.7%
* Euro: -1% to $1.0256
* British pound: -0.3% to $1.2352
* Japanese yen: +0.4% to 154.53 per dollar
* Mexican peso: -1.3% to 20.9557
* Canadian dollar: -0.9% to 1.4670
Cryptocurrencies:
* Bitcoin: -1.8% to $95,282.76
* Ether: -11% to $2,590.45
Bonds:
* 10-year Treasury yield: -3 basis points to 4.51%
* 10-year German yield: -8 basis points to 2.38%
* 10-year British yield: -6 basis points to 4.48%
Commodities:
* West Texas Intermediate crude: +1.3% to $73.45 a barrel
* Spot gold: +0.6% to $2,814.60 an ounce
Key Events:
* Tuesday: US factory orders, US durable goods, Alphabet earnings, speeches by Fed officials
* Wednesday: China Caixin services PMI, Eurozone HCOB Services PMI, PPI, US trade
* Thursday: Eurozone retail sales, UK rate decision, US initial jobless claims, Amazon earnings
* Friday: US nonfarm payrolls, unemployment, University of Michigan consumer sentiment, Fed speeches