Morning Wrap (06.03.2025)

• Wall Street ended yesterday's trading in a positive mood. The Nasdaq index posted almost 1.5% gains, while the S&P500 index added 1.12% and the Russell 2000 1.02%.

• In Asia, the broad market also felt greater buying pressure. The Hang Seng had a very successful day, recording almost 2.7% gains, and the Japanese Nikkei 225 added just over 1%.

• The gains on the Chinese market are primarily a reaction to the introduction of the Manus AI model, which is supposed to outperform OpenAI models in terms of performance, reported Shanghai Securities News.

• Given the good sentiment in the US and Asia, futures contracts also indicate a higher opening in today's session on European markets. The contract based on the German DAX adds 0.13%, and the one dependent on the French CAC40 increases 0.15%.

• Goldman Sachs raised its 2025 eurozone growth forecast by 0.1 percentage points to 0.8%, citing increased military and infrastructure spending, particularly in Germany. The bank expects the ECB to hold its rate cut in July, up from a previous forecast of a 25 basis point move.

• The former BoJ chief economist says the BoJ’s interest rate could rise to 2%. The next hike is likely in July.

• Canada is poised to ease tariff retaliation if Trump rolls back some of its own tariffs. Yesterday, there was news that the Trump administration was considering tariff exemptions for Canada and Mexico. This news supported the general “risk on” market sentiment and halted the gains in NATGAS (given the lower chances of fixed tariffs on energy from Canada to the US). 

• A 25bp rate cut is widely expected at today’s European Central Bank meeting, with much of the focus now on what the guidance will be for the coming months. EUR/USD rose slightly this morning toward 1.0820 before falling back just below 1.0800. 

• Oil is rebounding from recent sharp sell-offs. OIL.WTI is back above $66.50 a barrel after yesterday breaking out to its lowest levels since May 2023.

• Bitcoin and other cryptocurrencies are regaining ground today. BTC is up 2.3%, while Ethereum is up 3.35%.

A heatmap showing volatility in the currency market today. Source: xStation