Markets Overview

  • ASX SPI 200 futures up 0.6% to 8,021.00
  • Dow Average up 0.7% to 42,280.98
  • Aussie up 0.3% to 0.6297 per US$
  • US 10-year yield rose 1.8bps to 4.1859%
  • Australia 3-year bond yield rose 2.1 bps to 3.72%
  • Australia 10-year bond yield rose 0.6 bps to 4.42%
  • Gold spot up 0.4% to $3,125.47
  • Brent futures up 0.8% to $75.07/bbl

Economic Events

  • 09:00: (AU) March S&P Global Australia PMI Servi, prior 51.2
  • 09:00: (AU) March S&P Global Australia PMI Compo, prior 51.3
  • 10:30: (AU) Australia to Sell A$1 Billion 126-Day Bills
  • 10:30: (AU) Australia to Sell A$2 Billion 84-Day Bills
  • 11:30: (AU) Feb. International Trade Balance, est. A$5.4b, prior A$5.62b
  • 11:30: (AU) Feb. Job Vacancies QoQ, prior 4.2%
  • 11:30: (AU) Feb. Imports MoM, prior -0.3%
  • 11:30: (AU) Feb. Exports MoM, prior 1.3%
  • 11:30: (AU) RBA-Financial Stability Review

A tariff offensive Donald Trump billed as key to America’s long-term prosperity went down badly in markets late Wednesday, setting off a rout in equity benchmarks that had rallied for three days on hopes the program would be less draconian.

A $577 billion exchange-traded fund tracking the S&P 500 (SPY) fell about 3% after the close of regular trading – wiping out an initial rally. Bonds climbed. Trump said he will apply a minimum 10% tariff on all exporters to the US and slap additional duties on around 60 nations with the largest trade imbalances with the US. That includes substantially higher rates on some of the country’s biggest trading partners, such as China — which now faces a 54% total tariff — the European Union and Vietnam.

The late-session swoon halted three days of gains in the S&P 500 as hopes were dashed the tariff program would be lighter touch. Traders across asset classes now must brace for what promises to be a grueling stretch of trade negotiations, against an economic backdrop that has shown signs of softening as companies and consumers adjust to Trump’s offensive.

“Eye-watering tariffs on a country-by-country basis scream ‘negotiation tactic,’ which will keep markets on edge for the foreseeable future,” said Adam Hetts at Janus Henderson Investors.

The White House said steel and aluminum imports won’t be subject to reciprocal tariffs in a move that will provide at least some relief to domestic buyers already incurring 25% duties on all imports of the key metals used in everything from automobiles to dishwashers.

Shares of companies linked to sectors that will be hardest hit by the new round of levies were sharply lower in late New York trading. Nike Inc., Gap Inc. and Lululemon Athletica Inc. all fell at least 7%. They rely on goods and factories from Vietnam. Apple Inc., whose supply chain is heavily dependent on China, fell as much as 6.9%. Chipmakers such as Nvidia Corp. and Advanced Micro Devices Inc. were down, as were multinationals Caterpillar Inc. and Boeing Co.

Treasury Secretary Scott Bessent urged US trading partners against taking retaliatory steps against Trump’s new set of tariffs.

“I wouldn’t try to retaliate,” Bessent said in an interview Wednesday with Bloomberg Television. “As long as you don’t retaliate this is the high end of the number.”

The S&P 500 rose 0.7% on Wednesday. The Nasdaq 100 added 0.7%. the Dow Jones Industrial Average gained 0.6%. The US 10-year yield retreated four basis points to 4.13%. The Mexican peso and Canada’s dollar climbed on the news that both countries aren’t subject to reciprocal tariffs for now.