In European Equity Markets the pan-European Euro Stoxx 600 index closed 0.35% lower, with most sectors and bourses in negative territory. It comes after U.S. Trade Representative Robert Lighthizer on Monday proposed a list of European Union products on which to slap tariffs as retaliation for European aircraft subsidies, with Airbus down nearly 2%. Other European-listed stocks such as Rolls-Royce, Thales, Dassault Systemes and Leonardo were seen as among the most exposed to Lighthizer’s threat. Shares of each firm traded lower.
In Currency Markets the yen rose on Tuesday as traders favored the safe-haven currency after the United States announced it was considering tariffs on $11 billion (8.4 billion pounds) of European goods and the International Monetary Fund downgraded its outlook on the global economy. The yen was 0.34% higher at 111.125 per dollar and up 0.22% per euro. The Aussie was up 0.08% at $0.7131 after touching a near three-week high, while the loonie was little changed at C$1.332 after hitting C$1.3285, its strongest since March 21.
In Commodities Markets oil fell from a five-month high above $71 a barrel on Tuesday as Russian comments signalling the possible easing of a supply-cutting deal with OPEC countered concern that violence in Libya could further tighten global markets. Brent, the global benchmark, rose to $71.34 a barrel, the highest since November, but later was down 59 cents at $70.51. U.S. crude also hit a November 2018 high of $64.79 but was later down 23 cents at $64.17. On Tuesday, President Vladimir Putin said Russia did not support an uncontrollable rise in oil prices and that the current price suited Moscow.
In US Equity Markets stocks fell on Tuesday after President Donald Trump threatened to impose tariffs on European goods, while the IMF’s downbeat outlook for global growth added to worries about an economic slowdown stemming from trade disputes. The S&P 500 was down 0.43%, at 2,883.37 and the Nasdaq Composite fell 0.19%, at 7,938.91. The Dow Jones transports index fell 0.9%, on track to end a four-day run of gains. Pentair Plc shares fell13.8%, the most on the S&P 500, after the water treatment company forecast full-year profit below expectations.
In Bond Markets U.S. Treasury yields slid on Tuesday, weighed down by concerns about the global economic outlook after the International Monetary Fund reduced growth forecasts for 2019, as well as a round of headlines on Britain’s exit from the European Union. In mid-morning trading, U.S. 10-year note yields fell to 2.495%, down from 2.519% late on Monday. On the short end of the curve, U.S. 2-year yields slipped to 2.339%, compared with Monday’s 2.358%.