Macro Wrap

The DJIA and the S&P500 fell 0.4% and 0.1% respectively, while the Nasdaq Composite Index closed flat. The Eurostoxx 50 rose 0.6%. The Dollar Index was largely unchanged at 97.52 and EUR[1]USD edged up 20 pips to 1.1730. The US 2Y yield closed flat at 3.89% and the 10Y yield gained 2bp to 4.40%. The German 10Y yield rose 4bp to 2.69% and the UK 10Y yield rose 5bp to 4.63%. Brent crude oil prices rose 0.8% to USD70.15 and gold fell 1% to USD3,302

US President Trump plans to impose a 50% tariff on copper imports and suggested more sector-specific duties are on the way. He did not say specifically when that tariff would take effect. Trump also said he would soon announce tariffs “at a very, very high rate, like 200%,” on pharmaceutical imports. Sentimentally negative for Industrial commodities.

COMEX copper futures surged 13% to a record high of USD5.68 per pound, LME copper prices spiked to as high as $9888.50/mt following the tariff news, but later pared its gains to close the day 0.4% d/d lower at $9790.50/mt. Copper is the world’s third most used metal, after iron and aluminium. Sentimentally negative for long term copper demand.

Economic calendar – China Inflation Rate, China PPI, US FOMC Minutes