- Futures on European indices are losing pressured by the weakest session in six months in Asia and a sell-off across the United States equities. EU50 and DAX lose 1.9% and 1.6%, respectivelyÂ
- Investor attention focuses on tariffs and global trade tensions; dollar strengthens; USDCAD and USDMXN lose
- Macro focus will be on preliminary CPI and final manufacturing PMI readings from Europe and January ISM manufacturing from the United States scheduled at 3 PM GMT
U.S. indices opened the week with a downward gap, and it seems that if tariffs are not cancelled by Trump at the last minute, current conditions will allow markets to further correct the sentiment from the end of last year. The Fed estimates that the tariffs proposed at the current level will add about 0.7 percentage points to PCE inflation and reduce US GDP by more than 1.2 percentage points. We see U.S. 2-year yields rising today, against a further stabilization in 10-year Treasury bond yields, showing that the market is primarily concerned about the short-term impact of the tariffs on U.S. inflation. We still do not know whether China and Mexico will impose retaliatory tariffs on the US.
Economic calendar
7 AM GMT - Turkey, CPI inflation: 42.1 vs. 41.1% forecast and 44.3% previously (5% m/m vs. 4.3% forecast)
āđāļĢāļīāđāļĄāđāļāļĢāļāļāļąāļāļāļĩāļ§āļąāļāļāļĩāđ āļŦāļĢāļ·āļ āļĨāļāļāđāļāđāļāļąāļāļāļĩāļāļāļĨāļāļāđāļāļāđāļĢāđāļāļ§āļēāļĄāđāļŠāļĩāđāļĒāļ
āđāļāļīāļāļāļąāļāļāļĩ āļĨāļāļāļāļąāļāļāļĩāđāļāđāļĄāđ āļāļēāļ§āļāđāđāļŦāļĨāļāđāļāļāļĄāļ·āļāļāļ·āļ āļāļēāļ§āļāđāđāļŦāļĨāļāđāļāļāļĄāļ·āļāļāļ·āļ8 AM GMT - Poland, manufacturing PMI, expected 48.7 vs 48.2 previously
8:15 AM GMT - Spain, manufacturing PMI, expected 53.5 vs 53.3 previously
8:30 AM GMT - Switzerland, manufacturing PMI, expected 49.1 vs 48.4 previously
8:30 AM GMT - Hong Kong, GDP, expected 2.3% y/y vs 1.8% previously (0.9% k/k vs -1.1% previously)
8:45 AM GMT - Italy, manufacturing PMI, expected 46.9 vs 46.2 previously
8:50 AM GMT - France, manufacturing PMI, expected 45.3 vs 45.3 previously
8:55 AM GMT - Germany, manufacturing sector PMI, expected 44.1 vs 44.1 previously
9 AM GMT - Eurozone, manufacturing PMI, expected 46.1 vs 46.1 previously
9:30 AM GMT - UK, manufacturing sector PMI, expected 48.2 vs 48.2 previously
10 AM GMT - Eurozone, flash CPI for January, expected 2.4% y/y vs. 2.4% previously (-0.4% m/m vs. 0.4% previously)
- Core CPI flash for January estimated 2.6% vs 2.7% in December
2:45 PM GMT - United States, final manufacturing PMI, expected 50.1 vs 50.1 previously
3 PM GMT - United States, ISM manufacturing for January, expected 49.9 vs 49.3 previously (54.8 price component vs 52.5 previously)
Company quarterly results: Â Palantir, Super Micro Computer, NXP Semiconductors, Tyson