- APAC stocks traded mixed and in a rangebound fashion amid trade-related uncertainty, while weekend newsflow was mostly centred around geopolitics.
- US President Trump reportedly plans his tariff 'Liberation Day' with a more targeted push, according to Bloomberg.
- European equity futures indicate a mildly positive cash market open with Euro Stoxx 50 futures up 0.3% after the cash market closed with losses of 0.5% on Friday.
- USD is mixed vs peers, DXY is holding above 104, EUR/USD sits on a 1.08 handle, JPY is the marginal laggard across the majors.
- Turkish court formally arrested Istanbul Mayor Imamoglu after prosecutors asked the court to keep Imamoglu and four aides in jail pending their trial on terrorism and corruption charges.
- Russia-US talks in Saudi Arabia are to begin at 07:00GMT/03:00EDT, according to TASS citing an unnamed source.
- Looking ahead, highlights include EZ, UK & US PMIs, Speakers including BoE’s Bailey, RBA’s Jones, Fed’s Bostic & Barr.
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US TRADE
EQUITIES
- US stocks closed mixed on Friday on what was a choppy session amid quad witching but with outperformance in the Nasdaq as mega-cap stocks caught a bid in the final minutes of trade, while T-notes steepened with bonds fluctuating alongside the volatile risk environment.
- SPX +0.08% at 5,668, NDX +0.39% at 19,754, DJI +0.08% at 41,985, RUT -0.56% at 2,057.
- Click here for a detailed summary.
TARIFFS/TRADE
- US President Trump reportedly plans his tariff 'Liberation Day' with a more targeted push, according to Bloomberg citing officials, while it was noted that Trump will announce widespread reciprocal tariffs on nations or blocs but is set to exclude some and the administration is currently not planning separate, sectoral-specific tariffs to be unveiled at the same event as Trump had once signalled. Furthermore, WSJ also reported that the "White House Narrows April 2 Tariffs" and that tariffs on industrial sectors such as cars and microchips are no longer expected to be announced although major trading partners will still be hit with reciprocal tariffs.
- Canadian PM Carney said they aim to have free internal trade by Canada Day on July 1st and can increase GDP by CAD 150bln by reducing internal trade barriers between provinces, while he added they will allow businesses to defer corporate income tax payments and GST and HST remittance due to new US tariffs. Furthermore, PM Carney called for a general election on April 28th and proposed a middle-class tax cut to reduce the lowest tax bracket by 1%, as well as noted that Trump’s tariffs and threat actions create the most significant crisis of our lifetime and said Trump wants to break them so the US can own them.
- China reportedly explores limiting exports to mollify US President Trump and may offer to curb the quantity of certain goods exported to the US, according to WSJ citing advisers to the Chinese government. Furthermore, it was also reported that Trump directed US federal agencies to assess the economic relationship between the US and China with the review due in early April.
- China’s Foreign Minister Wang said China wants to pursue trade talks with other countries.
- Malaysia is to crack down on NVIDIA (NVDA) chip flows under US pressure, while Malaysia's Trade Minister said Washington suspects high-end semiconductors are making it to China despite trade controls, according to FT.
NOTABLE HEADLINES
- US President Trump signed a memorandum aimed at preventing abuses of the legal system and federal courts and directed the Attorney General to seek sanctions against lawyers and law firms that engage in frivolous unreasonable and vexatious litigation against the US government or departments and agencies of the government.
- US tax revenue could drop by 10% amid turmoil at the IRS from staff cuts and disruptions related to DOGE, according to Washington Post.
- US President Trump’s administration revoked temporary legal status for 530k Cubans, Haitians, Nicaraguans and Venezuelans in the US effective April 24th.
APAC TRADE
EQUITIES
- APAC stocks traded mixed in a rangebound fashion amid tariff and trade-related uncertainty, while weekend newsflow was mostly centred around geopolitics although there were some reports that suggested the potential for a more focused approach by US President Trump regarding April 2nd 'Liberation Day' reciprocal tariffs.
- ASX 200 was little changed as strength in financials and consumer discretionary offset the underperformance in consumer staples and tech, while the latest flash PMI data from Australia accelerated.
- Nikkei 225 swung between gains and losses with price action indecisive amid a weaker currency and a deterioration in Japanese flash PMIs which all printed in contraction territory.
- Hang Seng and Shanghai Comp conformed to the lacklustre mood amid lingering frictions although Chinese Premier Li stated at a business forum it is necessary for countries to open up their markets in an increasingly fragmented world and that China was ready for any unexpected shocks, while the PBoC reiterated its pledge to cut rates and RRR at an appropriate time during its quarterly meeting on Friday.
- US equity futures (ES +0.7%, NQ +0.8%) gained at the reopening with optimism spurred by the potential of a more targeted push by President Trump regarding April 2nd tariffs and could even exclude some countries.
- European equity futures indicate a mildly positive cash market open with Euro Stoxx 50 futures up 0.3% after the cash market closed with losses of 0.5% on Friday.
FX
- DXY was contained and initially softened after reports over the weekend regarding a potentially more targeted approach regarding April 2nd tariffs, although newsflow from the US was otherwise very quiet with participants looking ahead to this week's slew of releases including the Fed's preferred inflation gauge scheduled for Friday.
- EUR/USD eked mild gains following last Friday's rebound from a brief dip below the 1.0800 handle.
- GBP/USD was rangebound after just about retaining the 1.2900 status ahead of comments from BoE Governor Bailey later and with Chancellor Reeves to deliver the Spring Statement mid-week, while it was also reported that the civil service is to cut 10,000 jobs as the Labour government seeks GBP 2bln in Whitehall cost cuts.
- USD/JPY advanced from the open to hit resistance just shy of the 150.00 handle with the early upside facilitated by the contraction across Japanese PMI data, while currency jawboning by officials was largely ignored.
- Antipodeans were mixed amid the indecisive risk tone and with AUD/USD just about kept afloat following the acceleration in Australia's flash PMI data.
- PBoC set USD/CNY mid-point at 7.1780 vs exp. 7.2496 (Prev. 7.1760).
FIXED INCOME
- 10yr UST futures trickled beneath the 111.00 level after Friday's reversal and with early headwinds after reports that President Trump's April 2nd tariffs could be more targeted than the barrage he previously threatened.
- Bund futures took a breather from last week's gains amid quiet news flow from the bloc ahead of PMIs.
- 10yr JGB futures were lacklustre despite the deterioration across Japan's flash PMI data, while there were several comments from BoJ officials including Governor Ueda who reiterated the familiar rhetoric regarding adjusting the degree of monetary easing if the 2% inflation target is likely to be achieved.
COMMODITIES
- Crude futures were lacklustre amid the subdued risk appetite in Asia and following the deluge of geopolitical-related headlines over the weekend including US-Ukraine talks and Israel strikes against Hamas and Hezbollah.
- US President Trump told oil executives in a meeting during the prior week that he would consider efforts the administration might take to help oil firms fend off legal risks over climate issues, according to WSJ.
- Spot gold lacked firm direction after last week's pullback from record levels and as participants look ahead to a relatively busy calendar for US data this week including the latest Core PCE prices on Friday.
- Copper futures remained afloat after the recent rally in prices but with the upside capped after failing to sustain the psychological USD 10k level and amid the uninspired mood in Asia-Pac.
CRYPTO
- Bitcoin prices were choppy but ultimately gained after oscillating through the USD 86,000 level.
GLOBAL NEWS
- Turkish court formally arrested Istanbul Mayor Imamoglu after prosecutors asked the court to keep Imamoglu and four aides in jail pending their trial on terrorism and corruption charges. It was also reported that Turkey’s Central Bank Governor said in a meeting with bank executives that the central bank will do whatever is necessary within market rules, while the Capital Markets Board announced a ban on short selling on the Istanbul Stock Exchange until April 25th, eased the equity ratio requirement for credit capital markets transactions and removed the maximum limit for the total amount to be used for share buybacks of listed companies.
NOTABLE ASIA-PAC HEADLINES
- Chinese Premier Li said at a business forum it is necessary for countries to open up their markets in an increasingly fragmented world and countries must work to resist risks and challenges from rising instability and uncertainty. Li also stated that China was ready for bigger than expected external shocks and will focus on combining policy intensification with stimulating market forces, as well as deepen reform of the economic system and will strive to open up chokepoints of the economic cycle.
- US GOP Senator Daines met with Chinese Vice Premier He Lifeng on Saturday and noted that they are at a time when they have important issues to discuss between the two countries, while Senator Daines also met with Premier Li Qiang on Sunday in Beijing.
- BoJ Governor Ueda said they cannot sell long-term JGB holdings immediately and have been gradually tapering long-term JGB holdings now. Ueda said the purpose of BoJ policy is to achieve stable prices and will not be disturbed by consideration for state finances, while he reiterated that the BoJ will adjust the degree of monetary easing if the 2% inflation target is likely to be achieved.
- Japanese Finance Minister Kato said it is important for currencies to move in a stable manner reflecting fundamentals and they will take appropriate action against excessive moves.
- South Korea's Constitutional Court overturned the impeachment of Prime Minister Han, while Han stated he will address urgent issues of trade as a priority after being reinstated as the acting President.
DATA RECAP
- Japanese JibunBK Manufacturing PMI Flash SA (Mar) 48.3 (Prev. 49.0)
- Japanese JibunBK Services PMI Flash SA (Mar) 49.5 (Prev. 53.7)
- Japanese JibunBK Composite PMI Flash SA (Mar) 48.5 (Prev. 52.0)
- Australian Manufacturing PMI (Mar P) 52.6 (Prev. 50.4)
- Australian Services PMI (Mar P) 51.2 (Prev. 50.8)
- Australian Composite PMI (Mar P) 51.3 (Prev. 50.6)
GEOPOLITICAL
MIDDLE EAST
- Israeli PM Netanyahu spoke with US Secretary of State Rubio and discussed regional developments including the release of hostages and resumption of fighting in Gaza.
- Israel’s military said a projectile was launched from Yemen towards Israel which was intercepted and it conducted strikes on Rafah and Khan Younis, while Israel’s military also said the division that operated in Lebanon is preparing for Gaza activity.
- Israel conducted an air strike which killed Hamas political leader Salah Al-Bardaweel in the southern Gaza Strip and targeted the surgery department at Gaza’s Nasser Hospital which killed Hamas political bureau member Ismail Baarhoum.
- US peacekeepers said an escalation of the volatile situation at the Lebanon-Israel border could have serious consequences for the region, while it was reported that Israeli PM Netanyahu ordered strikes against dozens of targets in Lebanon in response to rocket fire although Hezbollah denied any link to rocket launches from southern Lebanon on Saturday.
- White House National Security Adviser Waltz said the US took out key Houthi leadership during strikes in Yemen, as well as weapons factories and some drone facilities, while he added that the US is seeking full dismantlement of the Iranian nuclear program in a way the entire world can see.
- US envoy Witkoff said Hamas is the aggressor here and had every opportunity to demilitarise and accept the bridging proposal but they elected not to. Witkoff also stated that their signal to Iran is let’s sit down and see if we can get to the right place through diplomacy, while he added that Iran cannot have a nuclear bomb which cannot and will not happen.
- Iran’s Foreign Minister Araqchi said talks with the US are impossible unless Washington changes its pressure policy.
RUSSIA-UKRAINE
- Ukraine and US delegations began talks in Saudi Arabia, while Ukrainian President Zelensky said the Ukrainian delegation is working in a completely constructive way and the conversation is quite useful. There were also comments from the Ukrainian Defence Minister that the agenda for talks included proposals to protect energy facilities and critical infrastructure.
- Russia-US talks in Saudi Arabia are to begin at 07:00GMT/03:00EDT, according to TASS citing an unnamed source.
- White House National Security Adviser Waltz said the US is talking through a number of confidence-building measures to end the Russia-Ukraine war including the future of Ukrainian children taken into Russia.
- US envoy Witkoff said the US expects a lot more progress on the Russia-Ukraine conflict and that Russian President Putin does not want to take all of Europe with the situation much more different than WW2.
- White House is aiming for a Russia-Ukraine truce agreement by April 20th, according to Bloomberg.
- Russia’s Kremlin said the Putin-Trump call was a step towards a face-to-face meeting and talks in Saudi Arabia will be as well. It was also reported that the Russian Defence Ministry said Russian forces took control of Sribne in eastern Ukraine, according to IFAX.
OTHER
- South Korea’s Foreign Minister said sanctions against North Korea must be carried out faithfully and that North Korea should not be rewarded for its wrongdoing in the course of the war in Ukraine.
- Venezuela’s government said it will resume repatriation flights of migrants from the US beginning on March 23rd.
EU/UK
NOTABLE HEADLINES
- UK Chancellor Reeves ordered GBP 2bln of Whitehall cuts to help fix the nation’s finances, according to FT. It was separately reported that Reeves said the UK will cut 10,000 civil service jobs, according to Bloomberg. Furthermore, Reeves will stick to fiscal rules despite global turmoil which raises the prospect of belt-tightening measures in the budget update this week, according to Reuters.
- UK Chancellor Reeves confirmed that the government is exploring potential adjustments to its digital services tax (DST) to avert further tariffs from the US, according to CityAM.
- Czech Republic is to rescue Radio Free Europe after US President Trump’s funding cuts, according to FT.
