Mike Dolan
6 min read
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By Mike Dolan
LONDON (Reuters) - What matters in U.S. and global markets today
Despite all the trade and geopolitical tensions, markets have a spring in their step today, due to hopes that U.S. bilateral tariff deals will soon emerge, expectations that interest rates will fall in Europe, and signs of economic resilience and tech demand in the U.S.
I discuss all this and the rest of today's market news below. Plus, check out today's column, where I explain why the euro's potential growth in reserve holdings could generate significant capital flows, even if it doesn't dethrone the dollar as the dominant global currency.
Today's Market Minute
* The U.S. tariff rate on most imported steel and aluminum doubled on Wednesday as President Donald Trump ratchets up a global trade war on the same day he expects trading partners to deliver their "best offer" in bids to avoid punishing import tax rates on other goods from taking effect in early July.
* Billionaire Elon Musk plunged on Tuesday into the congressional debate over Trump's sweeping tax and spending bill, calling it a "disgusting abomination" that will increase the federal deficit.
* Trump is set to use emergency powers and slash legal requirements relating to the Defense Production Act to lift U.S. production of critical minerals and weapons, according to a document seen by Reuters.
* It is widely believed that investors around the world have a disproportionately high exposure to U.S. assets, an imbalance that could roil U.S. markets if corrected. But Reuters columnist Jamie McGeever explains why those fears may be overblown.
* If 'American exceptionalism' truly is coming to an end, the key question for many investors is where capital may flow now. While Europe may be the obvious destination, Manishi Raychaudhuri, CEO of Emmer Capital Partners, argues that relative value metrics may favour emerging Asia.
Global stocks hit record highs
MSCI's all-country equity index hit a record high on Wednesday, a whopping 23% surge from the intraday trough of April 7 hit after the initial U.S. tariff sweep. The world index is now almost 6% higher for the year.
Wall Street continues to lag, but the S&P 500 is positive again for the year and the Nasdaq is within a whisker of breaking even in 2025. Stock index futures are up again ahead of today's bell, with stocks in Europe and Asia also rising smartly.
By contrast, U.S. Treasuries and the dollar both fell back, with the long bond yield now back near 5% and the euro briefly re-capturing $1.14 against the greenback.
