Markets Overview
- ASX SPI 200 futures down 0.8% to 8,161.00
- Dow Average down 1.2% to 43,331.56
- Aussie up 0.2% to 0.6223 per US$
- US 10-year yield fell 3.6bps to 4.1721%
- Australia 3-year bond yield rose 2.8 bps to 3.77%
- Australia 10-year bond yield rose 3.4 bps to 4.33%
- Gold spot up 0.8% to $2,881.42
- Brent futures down 2.1% to $71.30/bbl
Economic Events
- 11:30: (AU) 4Q Net Exports of GDP, est. -0.1, prior 0.1
- 11:30: (AU) Jan. Retail Sales MoM, est. 0.3%, prior -0.1%
- 11:30: (AU) 4Q BoP Current Account Balance, est. -A$12b, prior -A$14.1b
- 11:30: (AU) RBA Minutes of Feb. Policy Meeting
More tepid economic news and a pledge by Donald Trump to push through tariffs on top trading partners stressed Wall Street risk tolerances anew, sending bonds up and stocks to their biggest loss of the year.
The S&P 500 lost nearly 2% as the US president said Mexico and Canada would be unable to negotiate a reprieve from tariffs set to take effect Tuesday. The loonie and the peso slipped. The White House later said Trump also signed an order doubling a tariff on China to 20% A plunge in big tech weighed heavily on equities, which were also hit by weak manufacturing data.
Stocks erased their Friday runup to push the S&P 500 almost 5% below a record high from Feb. 19. The gauge has alternated between gains and losses of at least 1.5% for three sessions, a stretch of violent reversals not seen since March 2020.
Monday’s data was the latest in a slew of disappointing economic reports in the last two weeks, showing weaker housing, rising unemployment claims and a drop in personal spending. Crypto, a key proxy for risk in post-election markets, tumbled a day after surging when Trump stepped up calls for a digital-asset stockpile.
“It’s time to be nervous,” said Callie Cox at Ritholtz Wealth Management. “Not bearish, but nervous. While there isn’t enough evidence to think we’re on the cusp of a deep pullback, the economy is changing quickly. The headlines are so unrelenting that people don’t know what to do. So they wait for a better signal.”
The S&P 500 fell 1.8%. The Nasdaq 100 slid 2.2%. The Dow Jones Industrial Average dropped 1.5%. A gauge of the Magnificent Seven shares sank 3.1%. The Russell 2000 lost 2.8%. A UBS basket of US stocks negatively impacted by tariffs slipped 2.9%.
Wall Street’s so-called fear gauge — the VIX — hit the highest since December. All megacaps slipped, with Nvidia Corp. down 8.7%. Taiwan Semiconductor Manufacturing Co. plans to invest an additional $100 billion in US plants that will boost its chip output on American soil and supportTrump’s goal of increasing domestic manufacturing.
Oil sank as OPEC+ will proceed with plans to revive halted oil production, amid pressure from Trump to lower prices. The yield on 10-year Treasuries fell five basis points to 4.16%. The Bloomberg Dollar Spot Index fell 0.4%.
