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American indices mostly retreated on Friday in response to renewed trade tensions between China and the U.S. Futures suggest continued declines in today’s session (US100: -0.6%, US500: -0.4%, US30: -0.34%).
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China’s Ministry of Commerce accused Donald Trump of violating trade arrangements during negotiations, emphasizing China’s readiness to defend its interests. The statement dims hopes for a Xi-Trump meeting despite earlier declarations from Scott Bessent that such talks should happen soon.
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The U.S. administration plans to tighten restrictions on China’s tech sector by requiring special licenses for transactions with companies linked to already sanctioned firms (e.g., Huawei).
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Trump announced on social media Saturday that tariffs on steel and aluminum will be raised from 25% to 50%, starting Wednesday.
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Negative sentiment is spreading across Asia-Pacific markets. The HSCEI index is down the most (-2.15%), with losses also seen in Japan’s Nikkei 225 (-1.3%), South Korea’s Kospi (-0.2%), India’s Nifty 50 (-0.5%), and Australia’s S&P/ASX 200 (-0.24%).
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The biggest losers in Asia’s session are tech companies, Chinese EV makers, and firms tied to steel and aluminum.
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Australia’s manufacturing PMI fell in May from 51.7 to 51, while Japan’s rose from 49 to 49.4.
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On forex markets: the dollar is weakening against all G10 currencies (USDIDX: -0.1%) amid rising U.S.-China tensions. Antipodean currencies are gaining the most (AUDUSD: +0.36%, NZDUSD: +0.52%). The yen is strengthening (USDJPY: -0.48%) following PM Ishiba’s statement that Japan won’t compromise on tariffs. EURUSD rebounds 0.2% to 1.137. The Polish zloty is weakening after the second round of presidential elections (EURPLN: +0.5%, USDPLN: +0.35%).
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OPEC+ will raise oil production by 411,000 barrels per day in July, continuing its strategy to regain market share and penalize over-producers. Despite falling prices, leaders like Saudi Arabia and Russia push ahead, citing rising demand and strong fundamentals. Brent and WTI crude oil contracts are up 2.3% and 2.8%, respectively.
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Crypto market sentiment remains negative: Bitcoin is down 0.2% to $104,770, while Ethereum drops 1.5% to $2,489.
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Gold rebounds 0.9% to $3,320 per ounce on renewed U.S.-China tensions and dollar weakness. Silver gains 0.4% to $33.12 per ounce.
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FRA40 ticks higher after upbeat France business confidence data
Morning Wrap (23.10.2025)
Daily wrap – US Export Restrictions on China and Weaker Earnings Trigger Wall Street Correction
