At the end of Thursday, the Dow Jones Index (US30) fell by 1.30%. The S&P 500 Index (US500) was down 1.39%. The Nasdaq Technology Index (US100) lost 1.89%. Signs of escalating trade tensions triggered risk-off, sending stock prices tumbling. President Trump has threatened to impose 200% tariffs on European wine, champagne, and other spirits if the EU doesn’t slap a tax on US whiskey. Stocks’ losses accelerated Thursday after President Trump said he would not slap tariffs on steel and aluminum that took effect this week and would not back off plans to impose sweeping retaliatory tariffs that would begin on April 2.

Weekly US initial jobless claims unexpectedly fell by 2,000 to 220,000, indicating a strengthening labor market versus expectations of a rise to 225,000. The February PPI report excluding food and energy came in at negative 0.1% m/m and positive 3.4% y/y, weaker than expectations of positive 0.3% m/m and 3.5% y/y. The latest PPI and CPI data from the US suggest that price pressures eased in February, giving the Fed more room to cut rates.

Equity markets in Europe traded flat yesterday. Germany’s DAX (DE40) fell by 0.15%, France’s CAC 40 (FR40) closed down 0.64%, Spain’s IBEX 35 (ES35) gained 0.14%, and the UK’s FTSE 100 (UK100) closed up by 0.02%. President Trump threatened 200% tariffs on European spirits after the EU imposed a 50% tariff on US whiskey in response to previous US duties. Geopolitical concerns also weighed on sentiment amid continued uncertainty over a potential ceasefire. The Russian president did not support the temporary ceasefire.

Silver (XAG/USD) rose to $33.50 an ounce, the highest level since late October, as investors sought safe-haven assets amid heightened tariff tensions and rising bets on a Federal Reserve rate cut following weaker-than-expected US inflation data. Meanwhile, US Commerce Secretary Howard Lutnick said the recession will be “worth it” to implement Trump’s economic policies.

The US natural gas prices (XNG/USD) rose to $4.15/MMBtu on Thursday after falling 8.3% in the previous session as investors watched supply and demand dynamics. The US utilities withdrew 62 Bcf in the week ended March 7, above the expected 50-55 Bcf. As a result, storage levels are now 27% lower than the same period last year and 11.9% below the five-year average.

Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) was down 0.08%, China’s FTSE China A50 (CHA50) was down 0.10%, Hong Kong’s Hang Seng (HK50) lost 0.58% and Australia’s ASX 200 (AU200) was positive 0.32%.

Australia’s consumer inflation expectations for the next 12 months fell to 3.6% in March from 4.6% in February, indicating that price pressures in the economy are easing. The Australian dollar came under pressure earlier this week after the US imposed 25% tariffs on steel and aluminum imports, affecting about $1 billion worth of Australian exports. Despite trade concerns, Australia’s Prime Minister has not imposed retaliatory tariffs against the US. Instead, the government will continue to seek an exemption, warning that retaliatory measures could increase consumer spending and lead to higher inflation.

The New Zealand dollar received support from strong manufacturing PMI data. New Zealand’s Manufacturing Business Activity Index rose in February to its highest level since August 2022, thanks to an increase in production and new orders. Meanwhile, the country’s annual food inflation rose to 2.4% in February from 2.3% in the previous month.