Asian Shares, US Futures Rise on EU Tariff Delay
US and European equity-index futures climbed along with Asian stocks on Monday after President Donald Trump extended a deadline on aggressive European tariffs as trade tensions whipsawed markets.
Contracts for the S&P 500, Nasdaq 100 and Euro Stoxx 50 rose about 1% after Trump said he had agreed to delay the date for a 50% tariff on goods from the European Union to July 9 from June 1. The dollar fluctuated after falling to its lowest level since December 2023. The yen and Swiss franc, major beneficiaries of the Friday move, retreated. A gauge of Asian shares rose at the open.
Treasuries won’t be trading Monday due to the Memorial Day holiday in the US.
Trump’s moves reflected the increasing uncertainty in markets, with his broadside against Europe on Friday a harsh reminder of the president’s volatile policy making. The tariff war has returned to the fore as the major driver of markets once again after concerns about Trump’s proposed tax cuts, and their impact on US deficit, churned markets much of last week.
“A clear pattern has emerged when it comes to Trump’s tariff strategy - hefty tariff threats soon followed by tariff pauses during which negotiations ensue,” said Tim Waterer, chief market analyst at KCM Trade in Sydney. “So investors are getting to know the Trump tariff playbook quite well, with his back-and-forth with the EU in this matter being the latest such example.”
Trump’s decision to extend the deadline came after a phone call with European Commission President Ursula von der Leyen.
Von der Leyen, who heads the EU’s executive arm, said earlier Sunday in a post on X that “Europe is ready to advance talks swiftly and decisively,” but “a good deal” will need “time until July 9.” That’s the date that Trump’s 90-day pause of his so-called reciprocal tariffs had originally been set to end.
Trump’s tariff threats on Friday also included a 25% levy on smartphones if companies including Apple Inc. and Samsung Electronics Co. failed to move production to the US. Shares of Samsung dropped 0.6% at the open.
“Overall it’s good news on the day,” said Rodrigo Catril, a strategist at National Australia Bank in Sydney. “But the constant threats don’t make for a good environment for investment and hiring decisions.”
Source: Bloomberg
