Morning wrap (14.02.2025)

Wall Street gains were unbothered by yesterday’s higher-than-expected producer inflation data and President Trump’s note regarding new reciprocal tariffs on countries that currently tax imports from the U.S.

The specific details of these tariffs are expected to be presented to Trump at the beginning of April, and he has preset a 180-day deadline for their implementation.

The main U.S. indices closed Thursday’s session in the green (Nasdaq: +1.50%, S&P 500: +1.04%, DJIA: +0.77%, Russell 2000: +1.17%), while futures are trading flat, reflecting uncertainty ahead of today’s session.

Google and Apple have restored TikTok to their app stores after Donald Trump lifted the ban on the platform in the U.S. and announced there would be no penalties for distributing the app.

The U.S. dollar index (USDIDX) is down another 0.18% as investors lower their expectations regarding Trump’s protectionism. Despite week-to-week volatility, the dollar weakened by nearly 2.5% in February against a basket of currencies—the biggest monthly decline since November 2023.

Markets in Asia and the Pacific generally welcomed the delay in Trump’s trade war. The Hang Seng Index is leading gains (+2.05%), driven by commerce and industrial companies. The Shanghai Composite is up 0.1%, South Korea’s Kospi Index has risen 0.25%, while Japan’s Nikkei is down 0.8%.

A significant amount of liquidity will be withdrawn from the Chinese money market as authorities aim to reclaim 2.4 trillion yuan by the end of the month to repay central bank loans used for fiscal policy implementation.

This monetary tightening aligns with Chinese authorities’ efforts to counter further depreciation of the yuan against the USD amid tariff-related uncertainty.

Precious metals continue on the rise. Gold is up an additional 0.17% ($2,933.35 per ounce), silver continues its bullish rebound from yesterday (+1.63%; $32.87 per ounce), while platinum and palladium futures are trading 0.25% and 0.7% higher, respectively.

Energy commodity futures are also climbing (WTI: +0.15%; Brent: +0.06%; NATGAS: +2.09%).

Market volatility today will be shaped by the american retail sales data (expected month-over-month decline), industrial production (forecasted smaller month-over-month growth), and U.S. foreign trade prices. In the eurozone, the revision of the latest GDP reading and CPI data from, Swiss PPI and Spanish HICP will be a key focus.