The major assets started the week on shaky footing as Trump’s 100% tariff on foreign films reignited trade tension, snapping the S&P 500’s nine-day winning streak and sending the dollar lower despite solid U.S. services data.
Oil slumped on news of increased OPEC+ output, while gold surged as traders hunted safety in the face of renewed geopolitical uncertainty.
Here are headlines you may have missed in the last trading sessions:
Headlines:
- On Sunday, Trump announced plans to impose a 100% tariff on movies produced outside the U.S
- OPEC+ agreed to increase oil production by 411,000 barrels per day in June
- India has proposed zero tariffs on steel, auto components, and pharmaceuticals on a reciprocal basis up to a certain quantity in its trade negotiations with the US – Bloomberg
- Taiwan dollar posts sharpest surge since 1988 amid trade deal speculation with US
- AUD hit a five-month high after PM Albanese’s Labor Party won the weekend’s national election
- Australia S&P Global services PMI final for April: 51.0 (51.4 forecast; 51.6 previous)
- Australia ANZ-Indeed job ads for April: 0.5% m/m (0.3% m/m forecast; 0.4% m/m previous)
- Australia TD-MI inflation gauge for April: 0.6% m/m (0.4% m/m forecast; 0.7% m/m previous)
- Swiss inflation rate for April: 0.0% y/y (0.3% y/y forecast; 0.3% y/y previous); 0.0% m/m (0.1% m/m forecast; 0.0% m/m previous)
- Eurozone Sentix investor confidence for May: -8.1 (-14.9 forecast, -19.5 previous)
- Canada S&P Global services PMI for April: 41.5 (41.0 forecast; 41.2 previous)
- U.S. S&P Global services PMI final for April: 50.8 (51.4 forecast; 54.4 previous)
- U.S. ISM services PMI for April: 51.6 (50.3 forecast; 50.8 previous)
Broad Market Price Action:
Dollar Index, Gold, S&P 500, Oil, U.S. 10-yr Yield, Bitcoin Overlay Chart by TradingView
Global markets had a mixed day in a relatively quiet session, with several Asian exchanges closed for holidays. Asian and European indexes mostly posted gains, but U.S. stocks pulled back.
The S&P 500 snapped its nine-day winning streak after President Trump announced a 100% tariff on foreign films, reigniting trade concerns. Netflix slipped 1.9% and ended its own 11-day rally, while Berkshire Hathaway dropped around 5% after Warren Buffett said he’s stepping down as CEO.
Oil prices sank to four-year lows near $55.50 after OPEC+ agreed to raise output by 411,000 barrels per day in June, repeating May’s unexpected hike and fueling oversupply concerns as demand remains uncertain. On the other hand, gold surged nearly 3% to $3,330 as investors looked for safety. Bitcoin stayed mostly flat, closing about 1.7% lower at 94,276.
Meanwhile, the 10-year Treasury yields rose for a third straight session, adding 2.1 basis points to 4.34% as stronger US ISM services data and trade deal hopes lifted sentiment.
FX Market Behavior: U.S. Dollar vs. Majors:
Overlay of USD vs. Major Currencies Chart by TradingView
The dollar came under broad pressure Monday, with traders juggling fresh trade concerns and flickers of optimism. The selloff gained momentum during Asian and early European trading after Japan’s Finance Minister Kato denied reports that Tokyo might use U.S. Treasury holdings as leverage in trade talks, easing one major geopolitical risk.
Around the same time, rumors of renewed U.S.-China discussions sparked a wave of risk-on sentiment, even as President Trump’s 100% tariff on foreign films stirred up fresh trade anxiety.
One of the most eye-catching moves came from the Taiwan dollar, which surged roughly 3% on the day and 8% over two sessions. Mitsubishi UFJ Financial Group labeled the move a “19-standard deviation event,” fueling speculation that coordinated Asian currency revaluations could be part of a broader strategy in ongoing trade negotiations.
Economic data gave the dollar brief moments of support. U.S. ISM services beat expectations at 51.6 versus 50.2, and Swiss inflation surprised to the downside at 0.0% vs 0.2% forecast. Still, these positive blips weren’t enough to offset the market’s broader view that trade uncertainty could eventually push the Fed toward easing.
By the end of the session, the dollar had posted significant losses across the board, except against CAD. Treasury Secretary Bessent’s comment that “we are very close to some trade deals” helped strike a slightly more hopeful tone, but it wasn’t enough to keep the Greenback afloat.
Upcoming Potential Catalysts on the Economic Calendar:
- Swiss unemployment rate for April at 5:45 am GMT
- France industrial production for March at 6:45 am GMT
- France HCOB services PMI final for April at 7:50 am GMT
- Germany HCOB services PMI final for April at 7:55 am GMT
- Euro area HCOB services PMI final for April at 8:00 am GMT
- U.K. S&P Global services PMI final for April at 8:30 am GMT
- Euro area producer prices index for March at 9:00 am GMT
- Canada balance of trade for March at 12:30 pm GMT
- U.S. balance of trade for March at 12:30 pm GMT
- Canada Ivey PMI for April at 2:00 pm GMT
- U.S. RCM/TIPP economic optimism index for May at 2:10 pm GMT
- U.S. API crude oil stock change for the week ending May 2 at 8:30 pm GMT
Final services PMIs across Europe and Switzerland’s unemployment rate could move EUR and CHF during early European trading. In the U.S., trade data from both Uncle Sam and Canada may shed light on the impact of recent tariffs, while API crude oil stocks could stir energy markets.
Keep an eye on headlines, too! For instance, Canadian PM Carney’s visit to the White House might shape risk sentiment if it hints at progress on trade talks.
As always, stay nimble and don’t forget to check out our Forex Correlation Calculator when taking any trades!