European stocks saw a modest uptick as investors prepared for a week filled with significant earnings reports and economic data, while keeping a close eye on trade negotiations. The Stoxx Europe 600 index rose by 0.5%, supported by merger and acquisition news in Italy, where Mediobanca made a €6.3 billion ($7.1 billion) bid for Assicurazioni Generali’s wealth management division. However, S&P 500 futures dipped by 0.2% after a four-day rally, the longest winning streak for US equities since January. Meanwhile, Asian stocks gained 0.6%.
Gold prices saw a notable decline, dropping by as much as 1.6%, as traders unwound positions, questioning whether the precious metal’s recent rally had run its course. US Treasury yields rose by two basis points, and the dollar edged higher as markets awaited fresh data.
While the market turbulence triggered by President Donald Trump’s April 2 tariff announcements has somewhat subsided, traders remain focused on this week’s earnings reports to gauge the impact of US trade policies on corporate results. Key economic readings could also provide a boost to hopes that the Federal Reserve might cut interest rates sooner than anticipated.
“US investors are hanging on every word from the administration as they look for clues about the market’s next move,” said Michael Field, a strategist at Morningstar. “This has led to some large daily moves, which in the last week have largely been influenced by Trump’s comments on the Federal Reserve. European markets are largely following the same pattern.”
This week, earnings reports from four of the so-called Magnificent Seven — Microsoft, Apple, Meta Platforms, and Amazon — will be closely watched. Analysts forecast a 15% profit growth for the group in 2025, despite the trade tensions that have been flaring up since early March.
Investors are also closely monitoring any developments in US trade talks. Trump has suggested that further delays to his tariff hikes are unlikely, signaling potential progress. Meanwhile, Asian economies, facing some of the highest tariffs under US policy, have made notable headway in their trade discussions with the US administration.
In an effort to manage these negotiations, the Trump administration has drafted a framework to guide discussions with 18 countries, outlining key areas of concern. US Treasury Secretary Scott Bessent stated that the administration is working on bilateral deals with 17 partners, excluding China. Bessent also reiterated that Beijing will eventually be compelled to the negotiating table due to the unsustainable nature of Trump’s latest tariffs on Chinese goods, which stand at a steep 145%.
Despite recent market calm, some investors remain cautious. “The environment will remain highly uncertain and volatile throughout the year, with ongoing tensions around tariffs and geopolitics,” said Xin-Yao Ng, a fund manager at Aberdeen Investments in Singapore.
Key Market Moves:
Stocks: Stoxx Europe 600 +0.5%, S&P 500 futures -0.1%, MSCI Asia Pacific Index +0.6%, MSCI Emerging Markets Index +0.4%
Currencies: Dollar Index +0.1%, Euro -0.2% to $1.1347, Yen -0.1% to 143.82 per dollar, Offshore Yuan -0.2% to 7.3001 per dollar, British Pound -0.1% to $1.3301
Commodities: Brent crude steady, Gold -1.2% to $3,280.85 per ounce
Bonds: US 10-year yield +3 basis points to 4.26%, Germany 10-year yield +3 basis points to 2.50%, UK 10-year yield +1 basis point to 4.49%
Cryptocurrencies: Bitcoin +0.4% to $94,682.26, Ether +0.2% to $1,806.84
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