On both sides of the Atlantic investors are in different moods: while in the US there is fear of what operators call “the word with the R, that is, the Recession, which is creeping in through the fog of Trump's trade policy, European stock markets and the single currency have received a boost from the historic shift away from fiscal austerity in Germany and the increase in military defenses in the region. Thus, while US stock market futures are down -0,7% this morning, European ones indicate an opening up with a +0,5%.
The R-word creeps in through the fog created by tariffs
Last night, the US President's interview on Fox News did not go down well with dealers and analysts: Trump refused to predict whether his tariffs on China, Canada and Mexico would cause a recession in the United States. This was interpreted as an affirmative answer, and the "R-word", as analysts now translate their fear of a economic slowdown of the world's largest economy, is creeping in due to the tariff policy of Trump. The R-word has been making the rounds among traders and analysts: a Reuters poll found that the 91% of economists believes that the chances of a recession have increased due to Trump's rapidly changing trade policies.
The event continued on Friday weak economic data series in the United States, with labor market data showing fewer jobs than expected in the first payrolls report since Trump took office, as fears grow over an escalation in the global trade war. Attention now turns to next Wednesday when the payrolls index is released. consumer prices in the United States, which, if still elevated, could force the Fed to maintain a tighter monetary policy. Investors will remember well the higher-than-expected CPI data from last month, which saw inflation rise by 0,5%, the biggest monthly increase since August 2023. Wednesday's data will be among the last key data before the next Fed meeting March 18-19. While the central bank is expected to hold its benchmark rate steady at 4,25%-4,5% at that meeting, Fed Funds futures indicate that about another 70 basis points of easing is expected through December this year, according to LSEG data. The rest on Friday, the same Powell acknowledged increased uncertainty about the U.S. economic outlook.
Wall Street strategists have debated whether the Trump administration would be influenced by its tariff plans as stocks have fallen. The idea is that Trump will abandon the policies if the stock market, which he touts as a report card, collapses and rattles investors. Several firms have even mapped out how much pain Trump could tolerate in the S&P 500 before pulling back. That level of the index has become known as “Trump put”, in reference to a put option.
Meanwhile, traders have flocked to the Short-term Treasuries, sending the two-year yield sharply down from mid-February, amid expectations that the Fed will resume cutting interest rates as early as May to prevent the economy from deteriorating. U.S. Treasury yields slipped, with the 10-year yield falling as much as 6 basis points (bps) to 4,257% and the two-year yield falling 4,5 bps to 3,956%.
The tariff web thickens. US farmers are in revolt
Meanwhile, the tariff war is becoming increasingly dense in the world, with moves and countermoves, creating a web that gags economies. In his latest warning to the Canada, Trump said on Friday that reciprocal tariffs on dairy products and on timber. The US President also said he is seriously considering imposing sanctions on Russian banks e tariffs on Russian products to try to quickly end the war in Ukraine.
Duties of 10-15% on some American agricultural products come into force today in China: this is Beijing's latest retaliation against Washington's decision to double tariffs to 20% on all imports of Chinese-made goods to the United States. The reason for the increase in barriers is not trade but fentanyl, the synthetic drug that is responsible for about 100 deaths a year in America. The People's Republic, which says it is very strict in combating the spread of drugs, has targeted soy, sorghum, pork and beef, fish products, fruit, vegetables and dairy products, all of which are hit at 10%, while poultry, wheat, cotton and corn are in the 15% rate group. The tariffs will also not apply to goods shipped before March 10, as long as they arrive in China by April 12.
According to analysts, Beijing's retaliation aims to hit the Trump's voter base, while remaining so limited as to allow for the development of a possible negotiation and trade agreement. In the United States, the farmers are in revolt against decisions on tariffs: the vast majority of global trade in agri-food products is represented by commodities, that is, agricultural raw materials that are often undifferentiated and whose trade is driven by the price variable. Low-margin production for which the imposition of a tariff can immediately push companies out of the market.
La China also responds to CanadaThe Ministry of Finance said in a statement Saturday that there will be 100% tariffs on canola oil, canola meal and pea products, plus a 25% levy on imports of pork and certain seafood worth more than $2,6 billion. The changes will take effect March 20. Last year, Canada imposed a 100% levy on electric cars and a 25% levy on steel and aluminum from China, prompting the Chinese government to launch an anti-dumping investigation into Canadian canola imports and lodge a complaint with the World Trade Organization.
The gap between the US and Europe is widening
The last week has also widened the gap between the Wall Street performance and that of the European stock exchangesThe person in charge has a precise name: the Magnificent Seven. From January 500st to Friday, Dow Jones, S&P0,6 and Nasdaq have accumulated respectively a gain of 1,90%, a loss of 5,80% and a loss of -9% vs the brilliant +600% recorded by the global Stoxx 11 index. The Dow Jones has so far performed much better than the Wall Street average precisely because of the seven only Apple, Microsoft and Nvidia are present. The index of the Magnificent Seven in the same period has left XNUMX% on the ground, slipping to the lowest levels of the last four months. Tesla, the black sheep, recorded a -35% drop, which is justified by the step back of the American administration on green issues, the growing Chinese competition, the loss of appeal of Elon Musk as a child prodigy.
At the same time, the announcement of a gigantic European investment plan, which could be supported by the change in German fiscal rules, and the prospect of a peace in Ukraine, have reversed the mood towards the Old Continent, while the incalculable developments of theArtificial Intelligence Made in China (Alibaba and Deep Seek) have turned the tables on Asian high tech.
China Stocks Down, Tokyo, Seoul, Mumbai Stocks Up
The week begins in Asia Pacific with mixed stocks. The stock market Tokyo is up, Nikkei up 0,5% with the yen roughly level against the dollar on Friday at 147,6. Japanese workers' wages rose at the fastest pace in 32 years. Basic pay rose 3,1% in January from a year earlier, the biggest advance since October 1992, the Labor Ministry said overnight.
The bags of China fall. The Hang Seng Index in Hong Kong loses 1,5%. The CSI 300 Index of the Shanghai and Shenzhen stock exchanges -0,6%. Taipei's Taiex -0,3%. Theinflation has dropped much more than expected in China, below zero for the first time in 13 months, the data is distorted by seasonal distortions but is still a sign of deflationary pressures that persist in the economy. The consumer price index fell 0,7% from a year earlier, the National Bureau of Statistics said yesterday, compared with +0,5% in the previous month. Analysts surveyed by Bloomberg They had expected a 0,4% decline.
Elsewhere in Asia, the stock market is slightly up Alone, Kospi index +0,2%: North Korea fired several ballistic missiles tonight, in response to joint military exercises between the United States and South Korea. The benchmark stock index is trading at parity of Australia. BSE Sensex of Mumbai, + 0,3%.
Euro Strengthens, Bitcoin Loses Ground Again
On the currency markets, the euro strengthened again, gaining 0,3% to $1,0866, while the pound rose 0,2% to $1,2946. In contrast, the U.S. dollar index, which measures the currency against six major currencies, fell 0,1% to 103,59.
The cryptocurrency Bitcoin has fallen as much as 7,2% since Friday, hitting its lowest this month at $80.085,42. Optimism about looser regulation and the creation of a cryptocurrency reserve under Trump drove the token to an all-time high of $109.071,86 in January, but it has struggled since. The long-awaited executive order to create the reserve came on Friday, but disappointed many investors by saying there would be no further bitcoin purchases.
Il Brent down 0,4% at $70,11 a barrel on Monday and U.S. West Texas Intermediate crude down a similar margin at $66,76 a barrel. Their gained 0,15% to $2.915 an ounce.
European stocks seen positively: JPMorgan raises forecasts
JPMorgan joins Goldman Sachs in upping its 2025 eurozone growth forecast on the back of Germany's reforms. Analysts at America's largest bank expect growth to rise 0,1 percentage points to 0,8%. For 2026, JP Morgan forecasts growth of 1,2%, up 0,3 percentage points.
Germany. German industrial production rose 2,0 percent in January from the previous month, according to data published by the Federal Statistical Office. Analysts polled by Reuters They had forecast a 1,5% increase.
Banca Popolare di Sondrio tries to reject BPER's offer also through a new industrial plan on a stand-alone basis, which will be presented on March 12, writes IlSole24Ore.
B for Bank Deutsche Bank raises the target price to 8,40 euros.
Banco BPM There is much uncertainty over the exercise of the Golden Power rule, which could technically delay UniCredit's offer.
Unicredit. On Thursday, March 27, the shareholders of the credit institution will be called to approve the capital increase to service the takeover bid on Banco Bpm. The meeting was brought forward by a couple of weeks because the bank's board of directors is convinced that most of the authorizations are about to arrive, in particular that of the Supervisory Authority. Yet there is an exam on which it is complicated to make certain time forecasts, Milano Finanza emphasizes.
TIM The government is considering the FiberCop-Open Fiber merger without going through the separation of the black areas, writes Milan Finance. The operation, which requires the green light from the EU, would bring additional revenue to TIM.
Unicredit The German press says that the new German government will put even more restrictions on the takeover of Commerzbank.
Bank Ifis has received the green light from the Antitrust Authority for the takeover bid on illimity Bank.
Media for Europe has signed a deal with DAZN (which has exclusive rights to the event) to broadcast one match per day of the 2025 FIFA Club World Cup (hosted in the United States from June 14, 2025 to July 13, 2025). This is the first edition of this event that brings together the 32 best clubs from around the world.
sapphire has renewed its historic partnership with Special Olympics until 2027
Juventus lost 4-0 against Atalanta.
