The first day of April finds U.S. equities resuming their downward course ahead of tomorrow’s “Liberation Day,” when the U.S. is planning to launch reciprocal tariffs against virtually everyone, with additional measures possible against some countries. This follows a mixed finish to March, which saw the Dow Industrials gain 1.0% while the NASDAQ fell 0.2%. U.S. index futures are all down this morning, falling between 0.4% and 0.6%.
European equities are stronger so far today, with the Dax up 1.1% and the FTSE up 0.6%. Eurozone core CPI came in better than expected (2.4% vs street 2.5%). European Manufacturing PMI reports were generally below 50 in contraction territory. The UK was better than expected, Germany was in line and the rest of the continent was worse than expected. The Euro and Pound are down 0.2%-0.3% on this news.
In addition to potentially more leaks or trial balloons on US tariff plans there are a number of economic reports due later this morning, including Canada Manufacturing PMI (previous 47.8) at 9:30 am EDT, followed by US ISM Manufacturing PMI (street 49.5) and US Construction Spending (street 0.3%) both due at 10:00 am EDT. Tomorrow brings the official tariff announcements and US ADP payrolls. Amid all the current chaos, capital still appears to be making its way to traditional havens. Gold is up 0.3% at another new all-time high near $3,160/oz, and the Japanese Yen is up 0.5%. Interestingly, the Loonie is very quiet today. Commodity action is mixed with Crude Oil down 0.1% and Copper up 0.3%.