Tariff wars, possible US recession, latest corporate and political news
Latest stock market news
• Today is the last working day of the 1st quarter - this may add volatility. And the morning begins with a new wave of decline in stock index futures - another minus 1%. Gold is at a new historical maximum of $3139.
Bitcoin is below $82 thousand.
• It’s been a rough start to the week in Asia, with risk appetite sending stocks across the board lower while bonds have held on and gold has risen to a new record. Sentiment was fragile enough ahead of the U.S. tariff announcement on Wednesday, but President Trump made it even more fragile by telling reporters on Air Force One that the tariffs would hit all countries, not just a select few. He has a habit of dropping those comments early in the Asian trading day when liquidity is tight, causing big waves as a result.
The Nikkei led the rout, falling 3.8%, its biggest daily drop in six months, and virtually all of Asia was in the red. Nasdaq futures fell 1.3%, followed by futures on major European shares.
• Trump's new indifference to rising auto prices appears to have convinced analysts that he is serious about going all in. Goldman Sachs now expects retaliatory tariffs to average 15% across all US trading partners. In the same note, he raised the chance of a US recession from 20% to 35%, and the "R" word seems to be on everyone's lips.
• Recession Probability: Investors are betting that this coming slowdown will outweigh the inflationary impact of tariffs and push the Fed to cut rates by 75 basis points this year, although it would likely take a sharp rise in unemployment to justify such action. Markets have priced in about 60 basis points of easing from the ECB this year and 50 basis points for the Bank of England.
The thought of all this easing, coupled with a flight to safety, has been comforting for bond investors. Ten-year Treasury yields have fallen to 4.21% from a peak of 4.40% last Thursday. It remains to be seen whether the gains will continue as actual inflation data begins to show the impact of tariffs on prices.
For now, lower yields have pulled the dollar lower against the yen, and even the euro and pound have risen slightly. But yields aside, the dollar may find it harder to get its usual safe-haven momentum when the source of all this turbulence is the White House itself.
• I don't care if they raise prices. Americans will buy American cars - Donald Trump on automakers' concerns about tariffs April 2.
• French shun McDonald's, Coca-Cola and Tesla in protest against Trump - The Guardian
• Ozempic reduces shopping cravings: Scientists have found that the drug reduces cravings for alcohol, smoking and shopping. Research shows that drugs Wegovy and Ozempic, which mimic the satiety hormone GLP-1, can affect the brain's reward system.
• Investor survey shows they don't expect aggressive tariff increases - Goldman Sachs. The median estimate for the potential level of reciprocal tariffs is 9.3%, with the projected increase in the U.S. effective tariff rate by the end of 2025 at 8.6%.
But the Goldman Sachs team believes the initial proposed rate will be higher, potentially nearly double what market participants expect, Phillips writes.
• “Administration officials have made it clear that tariff rates will be announced soon as a basis for negotiations, which incentivizes the administration to offer higher rates initially,” Phillips wrote, explaining why the team believes tariffs will be higher than the market expects. “This has happened in recent experience with tariffs in Canada and Mexico, where high rates were imposed twice and then largely or completely reversed within days.”
• Elon Musk has sold the X social network to his AI startup xAI. He says the future of the two projects is closely intertwined, and the deal will unlock huge potential by combining the social network's vast reach and xAI's innovations.
X was valued at $33 billion, including $12 billion in debt - $11 billion less than the amount Musk paid for acquiring the platform. xAI, founded a year later, was valued at $80 billion. The deal was a stock swap,
reducing the risk of Musk's Tesla shares being liquidated.
• Fiscal stimulus does not offset the negative impact of tariffs on GDP growth, - Goldman Sachs.
• The U.S. Department of Defense announced plans to cancel a major contract with Leidos Holdings (LDOS) and Oracle (ORCL) to cut costs.
The program was significantly over budget and behind schedule.
• Palantir Technologies (PLTR) has reason to be optimistic as the US Army has decided to hold its Data Platform 2.0 program indefinitely in favor of the Palantir Vantage platform.
The move is expected to provide Palantir with significant revenue over the next four years.
• B2Gold (BTG) suffered a setback, with shares falling 8% after it unveiled a new mine plan for its Goose project in Canada.
The plan confirmed previous timelines and costs but showed a reduced resource estimate.
• The FCC has launched a new investigation into Walt Disney (DIS) and its ABC network, focusing on their DEI practices.
Concerns have been raised about possible equal employment opportunity violations.
• Johnson & Johnson (JNJ) unit ordered to pay $1.64 billion in HIV drug marketing case.
• Trump's tariffs will be in the spotlight this week as "Liberation Day" approaches on Wednesday, April 2.
The president is expected to announce tariffs on that day, with investors watching closely for specific details on how high the duties will be.
• Later this week, the focus will shift to the labor market, with the March employment report due on Friday. Attention is also expected to turn to updated data on private sector payrolls and job openings, as well as activity in the services and manufacturing sectors.
Key events likely to impact markets on Monday:
German retail sales, CPI and import prices
Speakers from the Riksbank and Norges Bank
Dallas Fed manufacturing survey for March
Current Fundamental Reviews
• For the US, the only threat is now China, the only priority is the defense of Taiwan, and everything else is secondary - WP received the Pentagon's secret strategy. The open secret has been revealed.
• Trump: US will 100% get Greenland. “We will get Greenland. Yes, 100%. There is a good chance that we can do it without military force, but I will not rule anything out,” Trump said.
If Iran does not make a deal, there will be bombing, - Trump.
Gegset: “US and Japan unite against Chinese aggression”
Trump said he is not going to fire Waltz and Gegset over the Signal scandal.
• Salvadoran President Nayib Bukele will visit the White House in April for talks with Trump.
• The US Department of Defense has announced plans to lay off between 5 and 8% of its civilian workforce. The department currently employs about 950,000 civilians, so the layoffs could affect up to 76,000 people.
• Musk is working to overhaul NASA's programs and spending to focus its resources on getting humans to Mars - WSJ
• Trump could remain in power until 2037 thanks to a loophole in the 22nd Amendment to the US Constitution - Daily Mail. He will be 90 years old.
Professor Bruce Peabody argues that the 22nd Amendment only prohibits "the re-election of a president who has already been elected twice", but such a head of state would not be prevented from subsequently holding the office again in the event of the resignation or death of another president.
• Trump wants to buy icebreakers from Finland. The future purchase of icebreakers by the United States to strengthen its influence in the Arctic was one of the key topics of discussion during an unofficial visit that Finnish President Alexander Stubb made to US President Donald Trump in Florida.
• The leader of the French far-right National Rally party, Marine Le Pen, risks losing her chance to run in the 2027 French presidential election. A Paris court is set to announce a ruling in the EU funds misuse case soon, and if it is not in her favor, the National Rally leader's political future will be at risk.
• There were unacceptable statements: in Germany, Merz was called upon to “eliminate pro-Russian ties” in his party. This call was made in connection with the statements of Merz’s fellow party member, the Prime Minister of the federal state of Saxony, Michael Kretschmer, regarding the easing of sanctions against the Russian Federation.
• Danish Prime Minister Mette Frederiksen will visit Greenland on April 2-4 for talks with the semi-autonomous territory's new government - Reuters.
• The IDF announced the start of a ground operation in Rafah in the southern Gaza Strip.
• A nationwide campaign has begun in Turkey to oust President Recep Tayyip Erdogan and hold early elections.
Opposition CHP leader Ozgur Ozel has launched a signature drive in Trabzon calling for freedom for opposition presidential candidate Ekrem Imamoglu.
• The first orbital rocket from Europe crashed. It was the first time a private company from continental Europe attempted an orbital launch.
• In Greenland, four of the five parties that won the elections have formed a coalition and are thus working to form a new government. As stated in the coalition agreement, the parties "stand together for a safe, free and developing Greenland."
• The US State Department informed Congress about the closure of USAID. This was stated in a press release from the US State Department. The reorganization of the US Agency for International Development (USAID) will be carried out by July 1. Some of its functions will be assumed by the State Department.
• Pentagon prepares to lay off up to 76,000 employees - Bloomberg. US Defense Secretary Pete Hegseth signed a memorandum on reducing the number of civilian employees in the Defense Department due to the Trump administration's cuts in government spending.
• Poland will have to bring back conscription in the army. In order to obtain a mass reserve for the armed forces - Chief of the Operational Command of the Polish Armed Forces General Maciej Klisz.
• Canada has no intention of cooperating with Russia in the Arctic, says Prime Minister Mark Carney. Canada will impose tariffs after the US announces new economic measures on April 2.
• "America is the central pillar that holds up all of Western civilization. If that pillar fails, it's all over," Musk.
• Europe should cut social spending and increase military spending at their expense, - former British Prime Minister Boris Johnson.
According to him, Americans are "irritated" by the fact that they pay more taxes for Europe's defense than the Europeans themselves. He also said that Europe should help preserve the Western alliance of countries and show that it is not a "freeloader" of the United States.
• Thousands of illegal migrants from Belarus end up in Germany - Bild. According to information received by Bild from security circles, thousands of illegal migrants who previously illegally entered Poland from Belarus (often using violence) across the external border of the EU are arriving in Germany.
• The Trump administration is considering allowing tax rates to rise on the wealthy if the 2017 tax cuts are not extended. That potential increase would return the top income tax rate to 39.6% from the current 37%.
• Hundreds of thousands of protesters have gathered in Istanbul in support of the city's arrested mayor, Ekrem Imamoglu. More than 2.2 million people are taking part in the protest, says Turkish opposition party leader Ozgur Ozel.