International stock sell-off pauses as traders catch | Australian Markets
Tumbling stock markets and rallying Treasuries have steadied considerably in Europe as a modicum of calm returned to markets after the day before today’s dramatic strikes when the Nasdaq had its greatest one-day fall in more than two years.
Europe’s broad Stoxx 600 index was flat in early trading on Tuesday, Asia Pacific-ex Japan shares, which had been down 1.75 per cent earlier within the day, had been final simply 0.5 per cent decrease, and US share futures had been up 0.3 per cent.
This was in stark distinction with Monday, when traders’ issues about a potential financial slowdown had been exacerbated after President Donald Trump in a Fox Information interview talked about a “period of transition” and declined to rule out a recession.
The S&P 500 fell 2.7 per cent on Monday, its greatest one-day drop in 2025, whereas the Nasdaq slid 4.0 per cent, its greatest single-day share drop since September 2022.
Prashant Newnaha, a senior Asia-Pacific charges strategist at TD Securities, stated most merchants had beforehand believed Trump would blink if shares tanked.
“Markets have now gotten the memo that the administration is intent on ripping the band-aid off. Tariffs and recession may be the medicine to create disinflation and getting that 10-year yield lower. For now it’s a controlled demolition.”
In the meantime, a rush to US Treasuries noticed the yield on benchmark US 10-year notes fall 10 foundation factors on Monday its largest every day transfer in virtually a month. It was one other 2 foundation factors decrease on Tuesday at 4.12 per cent.
The 2-year word yield, which usually strikes consistent with rate of interest expectations for the Federal Reserve, fell to a five-month low and was final down 1.5 bps at 3.88 per cent.
Merchants at the moment are pricing in 85 bps of easing from the Fed in 2025, in contrast with 75 bps on Monday, LSEG information confirmed, betting weak US growth will compel the Federal Reserve to start out easing again.
Wednesday’s US client price index might scuttle these expectations if it confirms that inflation continues to be a drawback.
Buyers are mindful of February’s hotter-than-expected information that noticed inflation rise 0.5 per cent in January, its greatest month-to-month gain since August 2023.
February’s CPI is predicted to have climbed 0.3 per cent, based on a Reuters ballot.
In currency markets, protected havens remained in demand, however strikes had been much less dramatic than the day earlier than.
The Japanese yen reached its strongest in 5 months in opposition to the greenback earlier than giving up good points to trade flat at 147.2.
Nonetheless, the yen is up seven per cent in opposition to the greenback in 2025.
The euro additionally strengthened 0.6 per cent to $US1.10898.
In commodities, oil costs had been regular as traders grappled with worries that US tariffs would sluggish economies across the world and harm vitality demand whereas OPEC+ ramps up its provide.
Gold costs rose to $US2,908 per ounce, within touching distance of the file high hit final month.
Gold is up 10 per cent to this point in 2025 after climbing 27 per cent in 2024.
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