Latest News

Dollar gains on the back of easing tariff concerns; Asian stocks surge

Dollar gains on the back of easing tariff concerns; Asian stocks surge

The dollar remained near its three-week-highs, as positive economic data gave some comfort. Asian stocks followed Wall Street's lead, with the expectation of a softer U.S. trade policy than initially anticipated.

As trade war fears grip the markets, investors have focused on the impending reciprocal Tariffs promised by U.S. president Donald Trump and their impact on the global economic situation.

Trump announced on Monday that automobile tariffs will be implemented soon, even though he said not all his levies threatened would be imposed by April 2, and some countries might get a break.

Investors were able to push U.S. stock prices higher. The S&P 500 reached its highest level in more than two weeks. Nasdaq rose over 2% on a rally of tech stocks.

The Nikkei 225 and Taiwan's stocks both rose over 1% on Tuesday. European futures were also higher during the early Asian hours.

Kyle Rodda is a senior financial market analyst at Capital.com. He said: "It appears we are getting a clearer picture of what these trade measures may be. If nothing else, that brings a little bit more certainty to markets."

Chinese stocks were much more subdued. Hong Kong's Hang Seng fell 1% while the blue chip CSI300 index remained unchanged.

Analysts remain cautious and skeptical that the rally will last long.

Gary Dugan is the chief executive officer of Global CIO Office. The headwinds in the market remain very real.

Kristina Clifon, economist at Commonwealth Bank of Australia said that the markets had not priced in enough bad news from the upcoming announcements of tariffs for the global economy.

The USD's safe-haven status can help it to survive bad news about the U.S. economy and global economy.

The dollar hit a three-week high against the yen at 150.95, after jumping 0.9% in the previous session, while hovering at its strongest since March 6 at $1.0781 per euro after stronger-than-expected U.S. economic data.

The S&P Global flash U.S. Composite Output PMI Index, which tracks manufacturing and service sectors, rose to 53.5 in March from 51.6 last month. A reading of more than 50 indicates growth in the private sector.

The PMI suggests that the economy is regaining momentum after hitting a lull in the middle of the first quarter. Retail sales and employment data have shown cracks in the economic foundation.

Investors will be watching the announcement of reciprocal tariffs next week, as well as the countries that the Trump administration will target.

The oil prices were unchanged in Tuesday's Asian hours, after having risen 1% the previous day as investors assessed the impact of Trump's announcement on social media that tariffs would be imposed on countries purchasing oil and gas from Venezuela.

Brent crude futures rose 3 cents to $73.03. U.S. West Texas Intermediate crude oil rose by 1 cent to $69.12.

Gold held steady at $3.013.75 an ounce as worries about U.S. Tariffs eased and a Federal Reserve official indicated a cautious approach to interest rate reductions this year.

(source: Reuters)