25/04/2025 Daily Reports
Markets Rally on Strong Earnings Despite Trade War Confusion and Geopolitical Tensions
- Global markets are showing strength as upbeat corporate earnings offset continuing uncertainty from U.S. President Donald Trump’s trade war with China. European stocks are set to open higher, after two weeks of gains, while Asia’s Nikkei jumped over 2%, driven by good performances from Alphabet, Nestle, and Merck.
- In the midst of ongoing tariff uncertainty — with Trump claiming negotiations with China that Beijing is categorically denying — markets now appear to be accepting the volatility as the “new normal.” Bilateral free trade agreement expectations are still high, though none have materialized to date. China is said to be lifting its 125% tariff on some U.S. products, including medical and industrial supplies.
- In contrast, investor concern continues with a list of major players like PepsiCo, Chipotle, and American Airlines cutting forecasts. Geopolitically, Russia-Ukraine war escalated with deadly missile strikes in Kyiv, prompting a direct social media call by Trump to Putin.
- The U.S. dollar strengthened in Asian trading, while U.S. equity futures signal additional gains. Thin economic data and earnings calendars today provide a brief reprieve in an otherwise chaotic context.
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Trump: Trade Deals Could Be Finalized Within Weeks
- In an interview with Time Magazine, President Donald Trump said the U.S. is on track to complete trade deals with several countries seeking lower tariffs.
- Trump stated that he expects deals to be finalized within the next three to four weeks. He added that while some countries may ask for adjustments later, he considers the process nearly complete.
- On China, Trump made conflicting remarks. He claimed the U.S. is “meeting with China” and doing fine in negotiations, yet also said he would not reach out to President Xi Jinping unless Xi called first. Later in the interview, Trump claimed Xi had already called.
- Despite China denying that formal talks are taking place, Trump insisted that progress is being made.
- Earlier this month, Trump announced steep tariff increases on imports from around 60 countries. However, he paused these measures for three months to allow time for negotiations, keeping a baseline 10 percent tariff in place during the period.
- Trump denied reports that Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick persuaded him to delay the tariffs. He said it was his own decision and dismissed concerns over market reactions.
- Trump stated he was not worried about the bond and equity market turmoil that followed his tariff announcements, saying “The bond market was getting the yips, but I wasn’t.”
- What’s Next?
Trump’s approach continues to blur the lines between strategy and spontaneity. These shifting statements might be part of a larger negotiation tactic — or simply improvisation. Either way, investors should prepare for more market turbulence as the global trade picture remains far from settled.
