Stocks and bond yields slid on Tuesday as investors reacted to new U.S. tariffs on Canada, Mexico, and China, raising concerns over escalating trade tensions.
\ud83d\udcc9 European stocks fell 1%, retreating from record highs.
\ud83d\udcc9 Automakers lost 3%, as they are particularly vulnerable to trade duties.
\ud83d\udcc8 Aerospace & defense stocks hit record highs, benefiting from geopolitical uncertainty.
\ud83d\udcc9 MSCI World Equity Index declined 0.2%, reflecting a broad risk-off sentiment.
\ud83d\udcc9 Bitcoin dropped below $84,000, erasing its earlier rally.
\ud83d\udcc9 Australian dollar weakened, as investors reduced exposure to riskier assets.
\ud83d\udd3b U.S. 10-year Treasury yields fell to 4.115%, their lowest level since October.
\ud83d\udd3b German 10-year bond yields also declined, signaling risk aversion in Eurozone markets.
As uncertainty mounts, investors are shifting into safe-haven assets like government bonds.
\ud83d\udcc9 The S&P 500 is down ~5% from its February 19 all-time closing high.
\ud83d\udcc8 U.S. futures gained 0.3%, hinting that the sell-off may stabilize.
The tariffs worsen global growth concerns, with market watchers wary of further retaliatory measures from China, Canada, and Mexico.
Aside from tariffs, investors are on edge due to:
\u26a0\ufe0f U.S. President Donald Trump pausing military aid to Ukraine after clashing with President Volodymyr Zelenskiy.
\u26a0\ufe0f Deepening tensions between the U.S. and its allies, adding further uncertainty.
According to Samy Chaar, Chief Economist at Lombard Odier:
"Everyone is caught by the onslaught. You have the news on tariffs, the news on Ukraine. It means you create uncertainty, and when you have that on markets, investors get back to base."
\ud83d\udca1 Will the sell-off continue, or will markets stabilize?
\ud83d\udca1 Will other nations retaliate with tariffs of their own?
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With heightened volatility, staying informed is critical for investors navigating the evolving landscape!
