Daily summary: Semiconductors sell off, incoming tariffs rattle forex, gold retreats (27.02.2025)

American indices are experiencing a mixed session today. The S&P 500 is trading flat after a weak start, the Dow Jones is up 0.7%, while the Nasdaq 100 is down 0.5%.

Trump announced new tariffs on Canada and Mexico. On his Truth Social platform, he declared a 25% tariff on products from Canada and Mexico starting March 4, citing insufficient progress in combating drug smuggling into the U.S.

Nvidia's (NVDA.US) earnings results were mostly above expectations, but investors reacted cautiously. Despite beating forecasts, the company's gross margin of 73.5% met consensus estimates, and its Q1 2025 outlook was slightly below prior expectations. As a result, Nvidia's stock is currently down around 2.5%, recovering slightly from a peak session decline of 4%.

Weak sentiment around Nvidia is spilling over into the tech sector. Following lower projections for upcoming quarters, Salesforce is also down 1.7%, TSMC is losing 3.5%, and among the "Magnificent Seven," only Apple and Tesla are seeing slight gains.

U.S. economic data took a backseat to Trump's tariff announcement. U.S. GDP grew 2.3% as expected, though consumer spending contributions were slightly below forecasts. This was offset by higher government spending and a better-than-expected trade balance.

Durable goods orders in the U.S. rose by 3.1% in January (versus a forecasted 2% increase and a -1.8% decline in the previous month).

New jobless claims rose to 242,000, exceeding the expected 221,000, marking the highest reading this year. The four-week average also reached its highest level since October.

Bond yields saw minor movements. U.S. 10-year yields rose slightly (+0.04 percentage points) but remained below 4.3%. Meanwhile, German 10-year bonds continued to decline, dropping to 2.41%.

European markets closed in the red. Germany's DAX suffered the biggest loss, falling over 1%. Swiss (SMI: -0.65%) and French (CAC 40: -0.5%) indices also declined, with the broad STOXX Europe 600 down 0.5%. Weak sentiment in Europe was fueled by Trump's comments on potential tariffs on EU products.

ECB minutes confirmed a cautious approach to rate cuts. The last rate reduction was aimed at supporting consumption, but the ECB noted increased risk appetite, which has boosted European stock prices since the start of the year.

The U.S. dollar dominated the forex market today. The USD index (USDIDX) rose 0.7%, supported by Trump's tariff declaration. EURUSD recorded its biggest drop of the year, falling to around 1.041 (from 1.051 at yesterday's open). Among G10 currencies, the biggest losers against the dollar were the New Zealand dollar (NZDUSD: -0.86%) and the Australian dollar (AUDUSD: -0.83%).

Gold extends its correction, dropping 1.06% to $2,885 per ounce. Silver (-1.15%), palladium (-1.6%), and platinum (-1%) are also declining.

The EIA gas storage report showed a slower-than-expected drawdown. U.S. gas stocks fell by 261 billion cubic feet (vs. a forecasted -265 billion), leading to no significant price reaction. However, earlier gains were erased, and contracts are now down 0.3%.

Oil futures are rising. Brent and WTI futures are up 2.25% and 2.5%, respectively.

Crypto sentiment remains mixed. Ethereum continues to decline after last Friday's ByBit incident (-0.85%), while Bitcoin has slightly slowed its recent losing streak (+0.13%, $84,500). Chainlink is down 0.7%, while Ripple (+0.8%), Solana (+2.5%), and Dogecoin (+2.3%) are gaining.