In a hope for a truce in Ukraine, major European stocks have been rising after the recent 25% U.S. tariffs on all steel and aluminum imports. These measures have been a point of concern for global markets, but the prospects of a de-escalation in the conflict in Ukraine brought some relief to investors, helping to stabilize markets after the sell-off.
During recent trading days, the CAC 40, France’s benchmark stock market index, gained 1.5%, reaching almost 8,060 points. Germany’s DAX index advanced by 2%, while Britain’s FTSE 100 index gained approximately 1.5%. In addition, the EuroStoxx 50 index rose approximately by 2%, the FTSEurofirst 300 Financial Index gained 2.1%, and the Stoxx 600 increased by 1.6%.
Gold price is up 8 points to $2990 per ounce, whereas silver is currently down 0.25 priced at $33.6. Oil prices rebounded despite rising U.S. inventories as the Dollar Index dropped to a four-month low, now at 103.5. Similarly, the Dow Jones Index has dropped by 6.44% over the past month, suggesting potential weaknesses in U.S. equity performance.
Meanwhile, data released by the U.S. Energy Information Administration (EIA) shows that U.S. crude oil inventories stood at 435.2 million barrels during the first week of March, an increase of 1.4 million barrels compared to the week before. The agency also reported that distillate inventories—including heating oil—declined by 1.6 million barrels, while gasoline inventories declined by 5.7 million barrels.
The President of the European Central Bank (ECB), Christine Lagarde, whose comments are closely watched amid trade concerns, said that the Eurozone is facing economic uncertainty. The reasons are risks from trade, defense, and climate-related shocks. She also highlighted that the ECD will continue targeting the 2% inflation rate in the mid-term.
The bottom line
U.S. tariffs appear to be a double-edged sword. Trade tension between the U.S. and EU and the UK may result in undesirable outcomes such as growing inflation, manufacturing stagnation, and possible debt crisis. What’s unfortunate, is that it will likely affect the ordinary consumers, with tax-payers likely facing higher costs.