United States
US equity markets closed higher on Wednesday, just minutes before President Donald Trump announced sweeping new tariffs. The Dow Jones Industrial Average climbed 0.56%, adding over 200 points to close at 42,225. The Nasdaq Composite rose 0.87% to 17,601, and the S&P 500 gained 0.67%, or 38 points, finishing at 5,670. Gains were broad-based, with eight of the eleven S&P 500 sectors advancing. The consumer discretionary sector led the rally.
After the market close, President Trump introduced far-reaching “reciprocal tariffs,” which include a baseline 10% global levy, adjusted by country: 34% on Chinese goods, 20% on EU imports, and 24% on Japanese products. He also confirmed that the previously proposed 25% tariff on auto imports would take effect on Thursday, April 3rd.
In immediate response, futures markets fell sharply. The S&P 500 futures were down 1.25%, while Nasdaq futures dropped 2.40%, reflecting investor concerns about a potential escalation in global trade tensions.
Tesla shares surged 5.31% following reports suggesting Elon Musk would soon step down from the “Department of Government Efficiency,” implying that spending cuts had been implemented and Musk would return to focus on his business ventures alongside President Trump. However, the White House later dismissed the reports as “garbage.” Earlier in the day, Tesla shares had fallen as much as 6.4% after reporting weaker-than-expected vehicle deliveries for the first quarter of 2025. Tesla ended the session at $282.71. One analyst commented, “We knew deliveries would be soft, but these numbers were bad.” Rival EV manufacturer Rivian dropped 6.10% after announcing a 36% year-over-year decline in vehicle deliveries.
Amazon shares rose 2.54% following a New York Times report that the company had submitted a bid for TikTok. The video-sharing platform faces a deadline of Saturday, April 5th, to divest from its Chinese ownership or face another ban in the US.
Elsewhere, CoreWeave—the newly listed AI cloud services provider—jumped another 20% to $62.66. Bank stocks and other tech names saw marginal moves as investors awaited further news after the market close.
On the economic front, private payrolls increased more than expected in March, with 155,000 jobs added compared to forecasts of a 120,000 gain. The job growth was broad-based across sectors. Meanwhile, durable goods orders rose in line with expectations, up 1%. Investors now turn to Friday’s non-farm payrolls report for a clearer picture of the US labour market.
US bond yields dropped after the tariff introduction falling 5 basis points to 4.11% earlier in the day, they had been higher by 5 basis points.
Europe
European investors remained on edge ahead of a key tariff announcement from the United States. The Euro Stoxx 600 index slipped 0.50% to 536.92, while the UK’s FTSE 100 fell 0.30% to 8,608. On the broader European index, nine of the eleven sectors ended lower, led by healthcare (-1.53%) and real estate (-0.89%). Gains in the remaining two sectors were minimal.
The healthcare sector was hit particularly hard, following steep declines in US markets on Tuesday afternoon. Danish pharmaceutical giant Novo Nordisk fell 2.59% after its controlling shareholder, Novo Holdings, reported that sales of its weight-loss drug Ozempic rose by 12% in the fourth quarter. The CEO of Novo Holdings also noted that the company would shift its strategic focus toward Asia this year. Swiss drug maker Roche dropped 1.92% after a study on a higher-dose version of its best-selling multiple sclerosis drug failed to produce positive results.
Defence stocks also came under pressure, with the aerospace and defence sub-sector declining 2.28%. Airbus lost 3.17%, giving up the previous day’s gains, while Germany’s Rheinmetall sank 4.21%.
Meanwhile, political leaders in both the UK and European Union were cautious in their responses to questions about potential retaliatory measures against the US. UK Chancellor Rachel Reeves stated that London would avoid a rushed reaction to prevent escalating a trade war. France’s industry minister echoed the sentiment, saying that any European response would be “proportionate.”
In bond markets, German 10-year yields rose 4 basis points to 2.72%, while UK yields remained steady at 4.63%. On the currency front, the euro strengthened by over 0.55% to trade at 1.0852 against the US dollar, while the British pound rose by a similar margin to 1.2983.
Australia
In overnight futures trading on Thursday morning the ASX200 futures moved higher by 42 points gaining 0.52%. The session closed before the announcement on tariffs were made by the US administration. As at 7.10 the AUDUSD was at 0.6294 up 0.20%
Investors took a cautious stance on Wednesday as they awaited further tariff announcements from the US administration. The ASX200 opened strongly, up 0.65%, but gradually drifted lower throughout the session, ultimately closing with a modest 9-point gain (+0.12%) at 7,934.50.
Six of the 11 sectors finished in positive territory, with real estate once again in demand. Materials and energy stocks weighed on the market, falling as concerns over global growth overshadowed the rise in commodity prices.
The real estate sector was buoyed primarily by Goodman Group, which surged 3.19% to $30.12, adding 93 cents. The recent two-day rally has been notably strong, as investors view the stock’s recent two-month selloff as overdone. Most other stocks in the sector posted modest gains of around 0.5%. Another standout was Charter Hall Group, which built on Tuesday’s 3.71% gain by rising a further 3.22% to close at $17.32.
Meanwhile, materials and energy stocks gave back gains from the previous session. BHP dropped 1.47% to $38.23, while Rio Tinto fell 1.73% to $115.80. Rio is scheduled to hold a vote on Thursday evening regarding its dual listing in London and Sydney, considering a potential move to a single primary listing—mirroring BHP’s approach. Activist investor Palliser Capital is behind the push, calling for an independent review of Rio’s corporate structure with the aim of establishing a primary listing on the ASX. However, Rio conducted an internal review last year and opted to maintain the status quo.
Profit-taking and portfolio rebalancing led to weakness in gold stocks. Evolution Mining fell 1.66%, while De Grey Mining declined 2.35% to $2.08.
The financials sector saw strength, particularly among the major banks. Westpac and CBA led the pack, gaining 1.05% and 1.04% respectively. Technology stocks also mirrored gains in global markets, with NextDC climbing 2.97% to $11.80 and Wisetech Global continuing its recovery, adding 1.11% to close at $83.90.
Bond markets remained quiet, with yields edging slightly higher. The 2-year yield rose by 3 basis points to 3.69%, while the 10-year yield was unchanged at 4.41%.
Commodities
Commodity traders remained cautious ahead of the anticipated US tariff announcements.
Copper saw only marginal movement, with prices on the London Metal Exchange rising US$8 to US$9,700 per tonne. COMEX copper in New York was similarly subdued, ticking up just 0.09%.
Iron ore slipped slightly, down 50 cents to US$102.50 per tonne—a 0.48% decline.
Gold traded quietly but managed to edge higher by 0.36%, closing at US$3,124.55, as safe-haven demand continued to underpin the market. Post the tariff announcement Gold extended its gains to be up 0.61% to US$3,132.
Oil prices also moved modestly higher. West Texas Intermediate (WTI) crude rose 0.90% or 64 cents to US$71.84, while Brent crude gained 0.75% to settle at US$75.05 at NY time 4pm before the tariff announcement. Despite a surprise increase in US crude inventories reported by the EIA on Wednesday—which would typically trigger selling—investors remained relatively calm. Market focus also shifted to supply concerns after Russia’s second-largest oil exporter announced export restrictions on a key Black Sea route. Post the announcement oil fell back with Brent unchanged at US$74.44 and WTI at US$71.38 up 0.25% from Tuesday.
Economic Calendar
AU:
- Balance of Trade (Feb) – 11:30am
China:
- Caixin Services PMI (Mar) – 12:45pm
US:
- Trade Balance (Feb) – 11:30pm
- Initial Jobless Claims -weekly – 11:30pm
- ISM Services PMI (Mar) – 1.00am
This article was written by Paul Darwell, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
