Global equities fall as trade war looms

Consumer confidence slid to its lowest level since January 2021, and the public’s expectations for the economy’s future also disappointed, falling to a 12-year low. This came after manufacturing PMI readings for March had already underperformed consensus estimates.

On Wednesday, Trump announced 25% tariffs on car imports, making an incipient trade war more likely. There was also a selloff in AI stocks during the week after Microsoft announced it was abandoning certain AI data centre projects.

On Friday, PCE inflation data came in hotter than anticipated, with prices growing 2.8% YoY in February vs 2.7% expected. Overall, US equities finished the week down -1.7% in euro terms. 10-year treasury yields were volatile as investors digested the various economic indicators and ultimately finished the week flat. 

In the Eurozone, PMI output data showed that business activity rose for a third consecutive month in March. Meanwhile, German business sentiment improved in March, with the ifo Business Climate Index rising to 86.7 from 85.3 in February, the highest it's been in seven months.

Despite the strong indicators, European equities fell following Trump’s announcement of auto tariffs, ending the week down nearly -1.8%. 

In the UK, a CPI release showed that inflation cooled in February to 2.8% YoY from 3% in January, beating expectations of 2.9%. Chancellor Rachel Reeves delivered her spring statement on Wednesday, and listeners were keen to catch any updates on the government’s outlook on an economy that has struggled so far in 2025. She announced a slew of spending cuts but also outlined additional military funding.

Equities

Global stocks finished down -1.5% in euro terms and -1.4% in local terms last week. Year-to-date global markets are down by -5.9% in euro terms and down by-1.6 % in local terms. The US market, the largest in the world, finished at -1.7% in euro terms and -1.6% local terms.

Fixed Income & FX

The US 10-year yield finished at 4.2% last week. The German equivalent finished at 2.7%. The Irish 10-year bond yield finished at 3.0%. The Euro/US Dollar exchange rate finished at 1.08, whilst Euro/GBP finished at 0.84.

Commodities

Oil finished the week at $69 per barrel and is down -7.5% year-to date in euro terms. Gold finished the week at $3,085 per troy ounce and is up 17.6% year-to-date in euro terms. Copper finished the week at $9,750 per tonne and is up 7.7% year-to-date in euro terms.

The week ahead

Monday 31^st March

China PMI data for March is released.

Tuesday 1^st April

Eurozone CPI inflation data for March is reported.

Friday 4^th April

US non-farm payrolls for March go to print.