Futures Rise As Global Markets Extend Monday's Torrid Rally

US equity futs are little changed, erasing a modest loss earlier in the session when investors took some profits from yesterday’s torrid rally which pushed the S&P 1.8% higher. As of 8:00am ET, S&P and Nasdaq futures are both up 0.2%, with Mag 7 stocks all higher pre-market, led by TSLA (+1.4%). European stocks gained as the Estoxx 50 rises 1.1% led by energy and financials, although Asian stocks dropped for a third straight day of losses, driven by Chinese tech shares trading in Hong Kong slid 2.6%, weighed down by a drop in Xiaomi after its $5.5 billion share sale. Investors were also rattled by Trump’s new threat of “secondary tariffs” on countries that buy oil from Venezuela. Bond yields are 1-3bp higher. Commodities are mostly higher led by precious metals (silver) and oil. WTI crude oil futures add about 0.5% to Monday’s 1.2% gain. Today, we will receive consumer confidence at 10am ET (est 94.0 survey vs. 98.3 prior). 

In premarket trading, Tesla whipsawed, first sliding as data showed fresh sales declines in Europe, only to rebound 1.4% higher making it the top gainer among the Mag7 stocks (Alphabet +0.3%, Amazon +0.1%, Apple +0.05%, Microsoft +0.1%, Meta +0.5%, Nvidia -0.4% and Tesla +1.4%). Ally Financial declines 2% after BTIG downgraded the auto-lender to sell, projecting that the company won’t meet its net interest margin and return on equity targets in the near term due to macroeconomic headwinds and increased competition. Carvana rises 4% after Morgan Stanley raised the used-car retailer to overweight, saying the pullback in shares creates an attractive entry point for the used-car retailer. Here are some other notable premarket movers:

• Cloudflare (NET) climbs 6% as BofA double-upgrades the software company to buy on improving fundamentals, saying it’s set to be an “AI winner.”
• Faraday Future (FFAI) climbs 13% after the mobility ecosystem company secured $41m in new cash financing commitments.
• KB Home (KBH) falls 9% after the homebuilder cut its fiscal 2025 revenue guidance amid a soft start to the spring selling season.
• McCormick (MKC) slips 3% as the maker of spices posted 1Q profit that missed expectations.
• Mobileye Global (MBLY) gains 9% after Volkswagen Group said it is working with the maker of software and hardware technologies for automobiles to enhance driver assistance in future MQB vehicles.
• Oklo (OKLO) slides 7% after the nuclear fission reactors firm reported disappointing quarterly results.
• Smithfield Foods Inc. (SFD) rises 3% after the world’s largest pork producer said it expects 2025 sales growth in the “low-to-mid-single-digit percent range”.
• Trump Media (DJT) jumps 7% after signing a non-binding agreement to partner with Crypto.com for a series of ETFs through its Truth.Fi brand.
• UniFirst (UNF) drops 10% after Cintas (CTAS) terminated discussions to acquire the workplace uniform rental company.

Markets have been unnerved by a fresh tariff salvo from Trump, who threatened a 25% levy on any nation purchasing crude from Venezuela. Brent crude rose 0.5%, adding to Monday’s gain. Trump also said he will announce tariffs on automobile imports in the coming days — and indicated nations will receive breaks from next week’s “reciprocal” tariffs, further adding to confusion about the plan for sweeping levies to kick in on April 2. 

“Between now and the 2nd of April, it’s just a phase of wait and see,” said Michael Nizard, head of multi-asset at Edmond de Rothschild Asset Management. “If Trump is doing exactly what he’s saying in terms of reciprocal tariffs, it should be negative both for Wall Street and Main Street.”

Investors also remain unclear on how tariffs might impact inflation and economic growth, with most recent data hinting at softer economic momentum alongside still-elevated price pressures. While swaps still price the Federal Reserve to cut rates twice this year, Atlanta Fed chief Raphael Bostic said Tuesday he sees just one 25 basis-point reduction, due to “very bumpy” inflation.

Meanwhile, Turkish markets continued to stabilize after a rout fuelled by the arrest of a key opposition leader. Stocks rose as much as 5.5% and the lira currency was steady, after a series of emergency measures helped calm markets. Top economic officials are due to speak with foreign investors later on Tuesday.  

Investors will now watch out for US consumer confidence data which is expected to have eased slightly in March from the previous month. 

The oil price rise fueled a rally in the shares of European oil majors including Shell Plc, BP Plc and TotalEnergies SE, lifting the Stoxx 600 index by 0.8%, and ending three straight sessions of losses as investors focus on the potential for a global trade war ahead of a US tariff deadline next week. Energy and insurance sectors lead gains while retail falls. Here are some of the biggest movers on Tuesday:

• Shell shares climb as much as 2.2% in London after the oil giant said it would boost investor returns through the end of this decade and strengthen its global leading position as an LNG trader.
• Morgan Sindall shares jump as much as 10% after the construction firm said that it expects 2025 results to be slightly ahead of market expectations thanks to an acceleration in trading momentum at its Fit Out division.
• Medacta shares gain as much as 6.8% as the Swiss medical-implant firm’s guidance offers scope for performance to exceed expectations, according to Stifel.
• Johnson Matthey shares drop as much as 4.1% after BofA Global Research cut its recommendation on the chemicals firm to neutral, saying its Clean Air business could be disrupted by the impact of tariffs on North American auto and truck production. 
• Baloise shares rise as much as 7.5%, to a new record high, after the Swiss insurer reported FY24 results. Analysts praised the better-than-expected profit and the initiation of a CHF100 million buyback program.
• Warehouse REIT shares rise as much as 5.9% after funds managed by Blackstone made a final proposal to buy the UK industrial landlord.
• Bellway shares rise as much as 4.1% after delivering reassuring interim results and reiterating its full year guidance.
• Gamma’s shares climbed as much as 5.3% after the communication service provider published positive results with a reassuring outlook and announced a buyback program.
• Kuehne+Nagel falls as much as 4.7% after the Swiss freight company presented 2025 targets that underwhelmed investors.
• Hermes shares slip as much as 0.9% as Oddo analysts trim their price target on the luxury goods maker on expectation that growth in the first quarter is set to be modest. Oddo also cuts its target for LVMH.
• Kingfisher shares fall as much as 13% after the British home improvement firm reported a disappointing 2026 outlook, analysts note, with its French and Polish businesses weighing particularly.

Earlier in the session, Asian equities are heading for a third straight day of losses, driven by selloff in Hong Kong as investors remain cautious about forthcoming US tariffs on China. The MSCI Asia Pacific Index declined as much as 0.4%, reversing a gain of 0.5%. Chinese internet stocks Alibaba and Tencent were among the biggest drags. Taiwan’s tech-heavy market tracked gains in US peers, while Japan’s gauges closed higher amid optimism over possible breaks from President Donald Trump’s levies. An index of Chinese shares trading in Hong Kong slid 2.6%, weighed down by a drop in Xiaomi after its $5.5 billion share sale. Investors were also rattled by Trump’s new threat of “secondary tariffs” on countries that buy oil from Venezuela. Investors in Chinese stocks are cautious ahead of the April 2 tariff announcement, said Gary Tan, a fund manager at Allspring Global Investments. “Chinese companies during their post 2024 results conference calls mostly guided cautiously on the growth outlook for this year. Both factors probably drove some near term profit-taking.” Elsewhere, Australian stocks rose ahead of the nation’s annual budget announcement later. Stock benchmarks also advanced in Singapore, New Zealand and Malaysia, while Philippine equities dropped. Indian stocks were little changed after Monday’s rally.

In FX, the Bloomberg Dollar Spot Index dropped 0.2% as investors also seek more clarity on “secondary tariffs” US President Donald Trump has threatened to impose on countries that buy oil from Venezuela. CHF and NZD are the weakest performers in G-10 FX, SEK and AUD outperform. The Australian dollar rises 0.2% versus the greenback after the government unveiled an unexpected tax cut and an extension of energy rebates. “Markets have not priced enough bad news for the world economy from the upcoming tariff announcements,” Kristina Clifton of Commonwealth Bank wrote in a note. “Bad news for the US and global economies can ultimately support USD because of its safe haven status”

In rates, treasuries are lower for the third straight day, extending Monday’s aggressive selloff as US stock futures trade steady and European equities advance. Treasury yields are 1bp-3bp cheaper across maturities with the curve steeper; 10-year at around 4.36% outperforms Germany’s, cheaper by an additional 3bps. Fed rate-cut pricing continues to fade, with around 58bp of easing priced in by December vs 60bp at Friday’s close. Auction cycle begins with $69 billion 2-year note sale, and corporate new-issue slate has begun to build following Monday’s nearly $25b haul. The 2-year note auction at 1pm New York time has WI yield near 4.03%, about 14bp richer than February’s, which stopped through by 1.1bp, a strong result. The IG dollar new-issue slate includes a four-part offering from LG Energy; 16 companies priced a combined $24.2 billion across 30 tranches Monday. 

In commodities, WTI futures reversed an earlier drop and rose 0.7% higher to trade near $69.60. Most base metals trade in the green. Spot gold rises roughly $12 to near $3,023/oz. Bitcoin trims loss. 

Looking at today's calendar, US data slate includes March Philadelphia Fed non-manufacturing activity (8:30am), January FHFA house price index and S&P CoreLogic home prices (9am), February new home sales, March consumer confidence and Richmond Fed manufacturing index (10am). Fed speaker slate includes Kugler (8:40am) and Williams (9:05am)

Market Snapshot

• S&P 500 futures down 0.2% to 5,804.00
• STOXX Europe 600 up 0.3% to 550.77
• MXAP down 0.3% to 188.08
• MXAPJ down 0.6% to 587.85
• Nikkei up 0.5% to 37,780.54
• Topix up 0.2% to 2,797.52
• Hang Seng Index down 2.3% to 23,344.25
• Shanghai Composite little changed at 3,369.98
• Sensex up 0.2% to 78,123.61
• Australia S&P/ASX 200 little changed at 7,942.46
• Kospi down 0.6% to 2,615.81
• German 10Y yield little changed at 2.80%
• Euro down 0.1% to $1.0788
• Brent Futures up 0.4% to $73.26/bbl
• Gold spot up 0.3% to $3,019.04
• US Dollar Index up 0.11% to 104.38

Top Overnight News

• A Trump administration proposal to impose stiff levies on Chinese-made ships entering US ports is sowing panic in the country’s agriculture industry, with farmers saying the added cost threatens to upend exports of wheat, corn, and soybeans. The US Trade Representative has recommended imposing fees of up to $1.5mm per prot call on ships built in China or operated by companies with Chinese-built vessels, and hearings on the matter are scheduled for this week. FT
• Treasury Secretary Bessent said interest rates are going to keep declining as energy costs decline and noted that laid-off workers can go into the private sector.
• Ukraine unconditionally supports the idea of a full ceasefire with Russia, Kyiv’s Ambassador to the US Oksana Markarova said. BBG
• Tech chiefs and senior foreign officials are urging the Trump administration to reconsider its AI diffusion rule that limits AI chip exports before the deadline for compliance arrives in less than two months. BBG
• Ifo’s German business optimism gauge rose more than expected, to the highest level since June 2024, as the government readied hundreds of billions of euros of spending. BBG
• Chinese technology stocks fell from a three-year high to the brink of a correction in just five sessions, fueled by a lack of positive surprise in earnings & cooling sentiment. The Hang Seng Tech Index dropped 3.8% on Tuesday, extending its slide from a March 18 high to nearly 10%. BBG
• China could broaden its consumer services stimulus plan to include services (such as travel and tourism) in addition to goods if the economy stays sluggish. FT
• India is open to cutting tariffs on more than half of U.S. imports worth $23 billion in the first phase of a trade deal the two nations are negotiating, two government sources said, the biggest cut in years, aimed at fending off reciprocal tariffs. RTRS
• Alibaba’s Joe Tsai warned of a potential bubble in datacenter construction, arguing that the buildout pace may outstrip initial demand for AI services. Tsai singled out US spending in particular. BBG
• Tesla shares reversed premarket losses even as its European car sales plummeted 40% in February, marking the 10th drop in the past year. The figures contrast with a 31% rise in industrywide EV registrations. BBG

Tariffs/Trade

• US President Trump signed an order imposing sanctions on countries importing Venezuelan oil and said tariffs for doing business with Venezuela will be on top of existing tariffs but added that not all tariffs will be included on April 2nd.
• India proposed to remove the 6% tariff imposed on online advertisement services offered by companies such as Google (GOOG) and Meta (META), widely known as the Google tax from April 1st, which is a day before Trump's reciprocal tariffs take effect.
• Subsequently, India is reportedly open to cutting tariffs on over half of US imports, worth USD 23bln, via Reuters citing sources; open to cutting tariffs to as low as 0 from a 5-30% range on 55% of US imports. Estimates a hit to USD 66bln worth of exports to the US from reciprocal tariffs. In return for tariff cuts, seeking relief from reciprocal tariffs.
• South Korea's Acting President Han said their mission is to secure national interest in a trade war and will do everything to weather the tariff storm triggered by the US, while it was also reported that South Korea is to launch a special probe on 'made in Korea' violations ahead of US tariffs.
• German Agriculture Ministry said Britain removed import restrictions on German animals and animal products imposed after the foot-and-mouth disease case.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks trade mixed after the early momentum from the tariff-related optimism on Wall St wore thin. ASX 200 advanced at the open but then gave back most of its gains after stalling near the 8,000 level and as participants await Treasurer Chalmers's pre-election budget which is expected to return to a deficit. Nikkei 225 rallied at the start of trade and briefly climbed above the 38,000 level but has since pulled back from intraday highs with recent currency moves influencing price action. Hang Seng and Shanghai Comp were pressured with notable underperformance in Hong Kong as tech and auto names lost traction amid recent earnings releases and tariff risk, while there was a lack of details so far regarding the PBoC's MLF operation after the central bank recently unveiled a new method for how MLF operations will be conducted whereby banks will be able to bid for different prices on its one-year loans.

Top Asian News

• China is considering including services in the multi-billion dollar subsidy program to stimulate consumption, according to FT.
• BoJ January Meeting Minutes stated most members expressed the recognition that the likelihood of realising the outlook had been rising and some members shared the recognition that real interest rates were expected to remain significantly negative even after the rate hike. The minutes stated that a member expressed the view that if underlying inflation increased, the BoJ would need to raise the policy interest rate accordingly in a gradual manner and a member continued that it would be necessary for the BoJ to adjust the degree of monetary accommodation from the viewpoint of avoiding the yen’s depreciation and the overheating of financial activities. Furthermore, a member said the BoJ should be extremely careful about suggesting the pace of policy interest rate hikes and the terminal policy rate and a member said it would be desirable for the BoJ to bear in mind that the policy interest rate should be at around 1% in the second half of fiscal 2025.
• BoJ Governor Ueda said they still need some time to consider what to do with the BoJ's ETF holdings and must think about valuation and market rout risks when offloading its ETF holdings. Ueda added that the BoJ's JGB holdings would continue to have a stock effect since the reduction pace is extremely slow and the massive JGB holdings have a stock effect that would slightly lower long-term yields.

European bourses defied the lead from futures and began the session on a firmer footing, Stoxx 600 +0.4%; no significant/fresh driver for the move with it seemingly an extension of Monday's US action. Sectors mostly in the green, Energy leads given benchmarks and with Shell (+2.0%) assisting. Retail lags, weighed on by Kingfisher (-11%) after weak results.

Top European News

• UK Chancellor Reeves is to publish the forecast from the OBR which is to roughly halve the UK’s expected growth in 2025 from 2% to about 1%, while her GBP 9.9bln of headroom against her fiscal rule has been wiped out, leaving her about GBP 4bln in the red. Furthermore, Reeves's statement is expected to have more than GBP 5bln of extra cuts to UK public spending and she will claim that Britain is “uniquely positioned” to pursue favourable trading relations with the US and EU, according to FT.
• ECB's Muller says rates are not restricting the economy or investments; tariffs are likely to mean faster inflation in the short term; any further cuts will be tariff dependent.
• ECB's Kazimir says "services inflation is key", open to discuss rate cut or pause in April; already in the zone of the neutral rate.

FX

• Relatively steady trade for the first part of the European morning but as we approach the US session slightly more pressured has emerged in the USD with the Index at a 104.15 trough. Overall, a session of slightly choppy FX action with moves turning around and extending in recent trade with no clear/overt fresh fundamental driving.
• EUR benefitting from the above move, no specific/fresh driver behind it. Prior to this, the index got back towards the 1.08 mark on the latest Ifo metrics which improved from the prior. Most recently, the USD action has lifted the single currency to a fresh 1.0816 session high.
• USD/JPY initially extended on the prior session's advances, but failed to breach the 151.00 mark and has been easing back since. Currently finds itself at a 150.32 low.
• Again, GBP was steady for the first part of the session but Cable picked up further from the 1.29 handle and is at a 1.2944 high, benefitting from USD moves. Specifics focussed entirely on Wednesday's Spring Statement.
• AUD saw little follow through from the pre-election budget announcement. Benefitting from the above moves and is just above the 0.63 mark in recent trade. Kiwi in the green, but not faring quite as well so far.
• PBoC set USD/CNY mid-point at 7.1788 vs exp. 7.2630 (Prev. 7.1780).

Fixed Income

• Benchmarks lower across the board. Bunds weighed on by the latest Ifo metrics with expectations and conditions printing above consensus while climate was in-line. A move which added to the bearish bias in fixed income and sent Bunds below the 128.00 mark around 10-minutes after the print. Currently just off a 127.84 base.
• USTs in-fitting, in a continuation of the sizable moves from Monday, which sent USTs to a 110-15+ base, a low that has since been taken out to a 110-11+ WTD trough.
• Gilts weighed on by the above and also as we count down to the Spring Statement. Fresh reporting ahead of this that the OBR’s growth forecast will be essentially cut in half from the 2% level outlined in the autumn. At a 91.05 base, lowest since March 6th when 90.71 printed.

Crude

• Crude complex remains supported after Monday’s buying, which saw WTI and Brent settle around USD 0.80/bbl higher after numerous catalysts aided the benchmarks. The latter, settling at the highest since late February.
• US remarks around Venezuela and tariffs in focus while we await an update on the geopolitical front.
• On this, Dutch TTF is modestly lower, owing to the “constructive” talks in Riyadh, which US and Ukrainian teams are set to be extending.
• Spot Gold has recouped some losses from overnight and is at a fresh session high of USD 3023/oz, seemingly benefiting from the initially tepid USD and US risk tone.

Geopolitics: Ukraine

• Ukraine delegation in Saudi Arabia will meet with the US team on Tuesday, according to a Ukrainian broadcaster Suspilne citing an unnamed source in the Ukrainian delegation.
• White House source says talks facilitated by the Trump administration's technical teams in Riyadh are going extremely well, and we expect to have a positive announcement in the near future.
• Russia and US talks in Saudi Arabia were not simple but were useful, while their talks will continue with participation of international community including the UN, according to TASS.
• Ukraine and US teams are said to be holding further Russia-Ukraine talks in Riyadh, according to Bloomberg.
• Russia's Kremlin says there are no plans for a Russian President Putin-US President Trump call yet but it can be organised; the content of the talks will not be disclosed in public.

Geopolitics: Middle East

• Israeli military says it struck targets at Syrian military bases.
• Houthi military spokesman says they targeted US naval vessels in the Red Sea and Israel's Ben Gurion Airport, according to Al Jazeera and Sky News Arabia.

US Event Calendar

• 08:30: March Philadelphia Fed Non-Manufactu, prior -13.1
• 09:00: Jan. S&P Case-Shiller 20 City MoM SA, est. 0.40%, prior 0.52%
  • Jan. S&P Case-Shiller Composite-20 YoY, est. 4.80%, prior 4.48%
• 09:00: Jan. FHFA House Price Index MoM, est. 0.3%, prior 0.4%
• 10:00: March Conf. Board Consumer Confidenc, est. 94.0, prior 98.3
  • March Conf. Board Expectations, prior 72.9
  • March Conf. Board Present Situation, prior 136.5
• 10:00: March Richmond Fed Index, est. 1, prior 6
• 10:00: Feb. New Home Sales, est. 680,000, prior 657,000
  • Feb. New Home Sales MoM, est. 3.5%, prior -10.5%

DB's Jim Reid concludes the overnight wrap

Good morning from New York, where Friday's headlines that next week’s reciprocal tariffs are set to be more targeted than previously expected, have continued to help the recent US outperformance. My theory is that US stocks now underperform most when the tariff threat is the highest, because if you believe returns to capital have been greatest under global free trade, then the larger the threat to that, the larger the impact on the ultimate beneficiary of capitalism in recent years, namely US stocks. See my CoTD from two weeks ago here for more on this theory.

Friday's news meant US futures were already pointing towards a solid start yesterday, but markets then got a fresh burst of support after the March flash PMIs were much stronger than expected, which collectively led to a pushback against the weaker US growth/recession narrative that’s developed over recent weeks. In turn, that meant US assets did very well, with the Magnificent 7 (+3.46%) posting its biggest gain in over two months, which in turn saw the S&P 500 (+1.76%) move further away from correction territory, having now risen +4.46% since its low on March 13. Moreover, the gains were broad-based, with the small-cap Russell 2000 (+2.55%) seeing its best day of 2025 so far. US equities continued to close the gap with their European counterparts, with the S&P 500 outpacing the STOXX 600 (-0.13%) for a fourth consecutive session, even if it’s still lagging well behind for the year as a whole.

Trump did say yesterday that he planned to proceed with auto tariffs “fairly soon, over the next few days” as well as those on pharmaceuticals at “some point in the not too distant future”, but any negative read across from this was offset by him saying that “I may give a lot of countries breaks” on reciprocal tariffs. We also heard from Stephen Miran, the new chair of the Council of Economic Advisers, who didn’t think there would be “material short-term pain from the tariffs”, while downplaying near-term prospects for a so called ‘Mar-a-Lago Accord’, saying that tariffs are “the sole focus right now”. In a note yesterday (link here), Peter Sidorov on my team discusses why we view such a new currency accord as unlikely and also considers the market implications were it to be pursued. The dollar index (+0.17%) moved higher for a fourth consecutive session yesterday, rising to its highest level since March 5, the day after tariffs against Canada and Mexico came into force.
But with most of the tariff stories having already come over the weekend, yesterday’s incremental news was really those flash PMIs for March, which offered an initial indication about how the global economy rounded out Q1. The numbers from the US were notably better than expected, with the composite PMI up to 53.5 (vs. 50.9 expected), which ended the monthly declines seen in January and February. Obviously the PMIs are based on a survey rather than hard data, but they are better than most surveys at capturing actual activity rather than sentiment, so the unexpected rise added to the sense that recent data simply wasn’t consistent with a recession. Indeed, all the hard data has generally been in a good place, with payrolls, retail sales and industrial production all growing in February. So that helped support a further easing in market stress, with the VIX index of volatility down -1.80pts to a one-month low of 17.48pts, whilst HY spreads (-15bps) reached their tightest in over two weeks, at 302bps.

Nevertheless, even as the output figures were decent, there were also some fresh warning signs on the inflation side. For instance, in the composite PMI, the input prices index was up to 60.9, the highest since April 2023. So that pointed to the tariffs filtering through into prices, which will be a concern for the Fed given inflation is still lingering above target. Indeed, the combination of the growth and inflation numbers meant investors dialled back their expectations for Fed easing this year, with the amount of rate cuts futures are pricing in by the December meeting down -8.6bps on the day to 62bps, although still more than the 55bps priced in just before the FOMC decision last Wednesday. This repricing was also helped by hawkish-leaning comments by Atlanta Fed President Bostic, who said he now only saw one rate cut, rather than two, likely this year as tariffs impeded disinflation. In turn, Treasury yields saw a fresh rise across the curve, with the 10yr yield (+8.9bps) up to a one-month high of 4.33%. Overnight, that move has only been pared back slightly, with the 10yr yield down -1.0bps to 4.32%.

Whilst US assets were recovering, the other tariff news we got was President Trump saying he’d place a 25% tariff on any country that purchased oil or gas from Venezuela. In response, the prospect of tighter supplies meant oil prices moved up to their highs of the day, with Brent crude (+1.16%) rising to $73.00/bbl, its highest closing level so far this month.

Over in Europe, there was quite a different tone yesterday. That came as the flash PMIs were generally a bit weaker than expected, even though they did improve for the most part. That took out some of the momentum from European risk assets, with the STOXX 600 (-0.13%) losing ground for a third consecutive session. And that was echoed across the continent, with the DAX (-0.17%), the CAC 40 (-0.26%) and the FTSE 100 (-0.10%) all seeing modest declines.
In terms of the PMI numbers themselves, the aggregate Euro Area composite PMI came in at 50.4 (vs. 50.7 expected). On the bright side, that was actually a 7-month high, but it was still barely above the 50-mark that separates expansion from contraction, so it was hard for investors to get too excited by that. At the country level, Germany’s composite PMI moved up to a 10-month high of 50.9 (vs. 51.1 expected), but France’s remained in contractionary territory at 47.0 (vs. 46.1 expected). Interestingly, the UK saw a decent outperformance ahead of this week’s Spring Statement, with the composite PMI up to a 6-month high of 52.0 (vs. 50.5 expected). And with the PMIs in hand, sovereign bond yields were broadly steady across the continent, with yields on 10yr bunds (+0.6bps), OATs (-0.3bps) and BTPs (-0.6bps) seeing little change.

Overnight in Asia, equities haven’t kept up their momentum from the US session. The Hang Seng (-2.18%) has been the worst performer of the major indices, and the Hang Seng Tech index (-3.67%) has seen even bigger losses, which is the reverse of what happened in the US where the Mag 7 helped lift the broader market. Otherwise, several other indices have lost ground, including the CSI 300 (-0.20%) and the Shanghai Comp (-0.11%), whilst the KOSPI is down -0.64%. However, the losses haven’t been universal, and there have been advances for Japan’s Nikkei (+0.41%) and Australia’s S&P/ASX 200 (+0.07%) this morning. Looking forward however, US and European equity futures are pointing lower, with those on the S&P 500 (-0.15%) and the DAX (-0.23%) both down this morning.

To the day ahead now, and data releases include the German Ifo business climate indicator for March, and in the US there’s the Conference Board’s consumer confidence indicator for March, and new home sales for February. From central banks, we’ll hear from the Fed’s Kugler and Williams, along with the ECB’s Kazimir, Muller, Holzmann, Vujcic and Nagel.