Markets Overview

  • ASX SPI 200 futures down 0.4% to 8,350.00
  • Dow Average down 0.6% to 41,603.07
  • Aussie up 1.2% to 0.6489 per US$
  • US 10-year yield fell 1.7bps to 4.5110%
  • Australia 3-year bond yield fell 1.9 bps to 3.46%
  • Australia 10-year bond yield fell 3.5 bps to 4.42%
  • Gold spot up 1.9% to $3,357.51
  • Brent futures up 0.5% to $64.78/bbl

Economic Events

US equity-index futures climbed in early Asian trading on Monday after President Donald Trump extended a deadline on aggressive European tariffs.

Contracts for the S&P 500 rose around 0.9% while those for the Nasdaq 100 climbed around 1% after Trump said he had agreed to push out the deadline for a 50% tariff on goods from the European Union from June 1 to July 9. The gains for the contracts partly reversed declines on Friday when Trump announced the deadline.

Asian equity-futures trading recorded prior to Trump’s deadline extension fell in line with Friday moves on Wall Street as contracts for Japanese, Australian and Hong Kong stocks were all lower.

The dollar also strengthened on Trump’s latest statement after an index of the greenback fell to the lowest level since December 2023 on Friday. The yen and Swiss franc, major beneficiaries of the Friday move, retreated early Monday in Asia.

The moves reflected the increasing uncertainty in markets, with Trump’s broadside against Europe on Friday a harsh reminder of the president’s volatile policymaking. Trump’s tariff threats on Friday also included a 25% levy on smart phones if companies including Apple Inc. and Samsung Electronics Co. failed to move production to the US.

Treasuries ended Friday little changed after yields soared earlier in the week in a sign traders were growing anxious about the fiscal effects of Trump’s signature legislative package, which features new tax breaks. Treasuries were closed on Monday for a holiday.

Investors are also gearing up for the Federal Reserve’s preferred inflation measure, the US personal consumption expenditures price index excluding food and energy, which will be released Friday. The April reading is forecast to rise 0.1% based on consensus expectations.

To Capital Economics, Trump’s threat of a 50% tariff on the EU from June may well turn out to be a “negotiating tactic” and seems “very unlikely” to be where tariffs settle over the long run.

“At this stage, we are not inclined to change our working assumption that tariffs on the EU will ultimately settle around 10%, but this underlines that there are risks and that the road to an agreement could be rocky,” the firm said.

In commodities, oil and gold were steady early Monday after gains on Friday. The precious metal was fractionally lower after it rallied 1.9% Friday on haven demand to trade around $3,357 per ounce.

Economic data set for release in Asia includes industrial production for Singapore, trade for Hong Kong, while retail sales data for South Korea may be released any time through Saturday.

Elsewhere, signs of port congestion in northern Europe and other hubs suggests trade wars could lead to maritime disruptions around the world, increasing shipping rates.

Separately, Trump on Friday announced a partnership between United States Steel Corp. and Japan’s Nippon Steel Corp., shocking markets with an agreement he said would keep the once-iconic American firm in the US but otherwise providing no specifics. Shares in US Steel rose 21.2%.