Last week, markets traded on a weaker tone, led by a stronger dollar (+0.86%) while US stocks plummeted around 1-2% as Trump’s new government started its tariffs trade war, threatening global economic growth. Global markets were impacted, with European shares falling, emerging markets weaker and crypto prices lower, amid concerns over inflation, economic growth, and corporate earnings.
The new tariffs officially start tomorrow, with the US government charging 25% of imported goods from Mexico and Canada, and 10% from China. The worry among investors is that US tariffs will force companies to raise prices in response, causing inflation to accelerate, consumers to pull back on spending and economic growth to slow.
In the meantime, last week overall US macro data came mixed, while we had the Federal Reserve holding rates as expected. Jerome Powell cited the resilient economy and the need to see inflation making more progress.
Tech sector reported good results, led by Meta, Apple and Intel. Markets continue to closely monitor the DeepSeek developments and its potential impact on the Artificial Intelligence sector.