📆 Monday, March 3
► European markets saw mixed moves as defense stocks soared following a push by European leaders to ramp up military spending amid rising geopolitical tensions. BAE Systems (+14%), Rheinmetall (+12%), and Saab (+11%), gained on expectations of higher defense budgets. The Stoxx 600 is up 0.5% even as S&P has put France’s credit outlook on negative watch. European bond yields rose, with 10-year German bund yields climbing (+4 bps) as investors priced a larger-than-forecast government bond issue. The Spanish manufacturing purchasing managers' index fell to 49.7, slipping into recession for the first time in a year.
► US stock futures traded cautiously as investors prepared for Trump’s March 4 tariff deadline, with the S&P 500 (+0.25%) and Nasdaq 100 (+0.3%) stabilizing for now after Friday’s late 1.6% rally. The Trump-Zelensky meeting on Friday ended in a heated exchange, with Trump abruptly ending discussions after accusing Zelensky of “gambling with World War III”. The planned US-Ukraine minerals deal was canceled, raising concerns over Ukraine’s ability to secure military aid from Washington. Meanwhile, Trump confirmed that a 25% tariff on Mexico and Canada will take effect Tuesday, along with an additional 10% levy on Chinese imports (then 20%), escalating trade war fears. US Treasury yields rose, with the 10-year yield climbing to 4.24%, as markets priced in inflationary risks from tariffs.
► Asian markets had a mixed session, as China’s PMI data surprised to the upside, but investors remained cautious ahead of Trump’s tariffs. Japan’s Nikkei 225 (+1.81%) rebounded, supported by a weaker JPY, while China’s Shanghai Composite (-0.06%) stayed flat, despite factory activity expanding at the fastest pace in three months. Hong Kong’s Hang Seng (+0.28%) recovered slightly from a two-day losing streak. Investors are watching China’s National People’s Congress meeting on Wednesday, where Beijing may announce stimulus measures and potential countermeasures to US tariffs.
Subscribe to see more
