This report is from today’s TNC’s Daily Open, our international markets update. TNC Daily Open keeps investors informed on everything they need to know, no matter where they are.
“Flexibility” implies being adaptable. On Friday, U.S. President Donald Trump hinted at the potential of easing tariffs, which might have contributed to a slight stock increase and a weekly gain in the three main U.S. benchmarks.
However, “flexibility,” which implies adjusting to changing conditions, also conveys uncertainty, which the market finds unacceptable. It’s also important to consider the context of Trump’s remarks. “There’ll be flexibility, but basically it’s reciprocal,” he clarified, seemingly rejecting the notion of making special provisions for some nations.
In other words, Trump’s flexibility doesn’t look like a one-sided act of kindness but rather a tactic to subdue the will of others.
Trump stated that the reciprocal tariffs will start on April 2, so unless he is equally flexible with the start date, we won’t likely know how they will work out until then.
What To Note Today
Trump’s “flexibility” with tariffs
Trump hinted that he would take action in response to any changes made by trading partners when he told reporters on Friday that “there’ll be flexibility” regarding his tariff plans, “but basically it’s reciprocal.” But Trump claimed that “once you do that for one, you have to do that for all,” downplaying the idea of making additional exceptions. According to the White House, reciprocal tariffs will take effect on April 2.
China will expand its market: Vice Premier
According to a Ministry of Commerce readout of a meeting with top executives from Apple, Mastercard, and other international corporations on Sunday, China’s Vice Premier He Lifeng assured foreign business leaders that Beijing will continue to open its market and welcome more investment. He also spoke about strengthening trade and economic ties between the United States and China at the event.
US stocks end their losing run
After four weeks of declines, major U.S. indices rose on Friday. The Dow Jones Industrial Average increased 1.2%, the S&P 500 increased 0.5%, and the Nasdaq Composite increased 0.2% throughout the week. However, FedEx, a gauge of the economy, fell 6.5% after lowering its forecast for earnings. The majority of Asia-Pacific markets declined on Monday. However, the country’s consumer price index for February grew at its weakest rate in four years, 0.9% year over year, while Singapore’s Straits Times Index increased by 0.18%.
The Average Seven
Six Magnificent Seven stocks that spearheaded the stock market’s 2024 bull run are already on course for substantial year-to-date losses, with a 40% decline in Tesla shares leading the way. The sole exception, Meta Platform, is clinging to a small profit. Earlier this month, the tech-heavy Nasdaq Composite had its worst day since 2022, with the megacaps losing over $750 billion in total value.
South Korean acting president is reinstalled
Prime Minister Han Duck-soo was reinstated as acting president on Monday after the Constitutional Court of South Korea overturned his impeachment, according to local media. He will replace Choi Sang-mok in the position. In December, the opposition Democratic Party impeached Han for allegedly refusing to name three judges to the Constitutional Court investigating President Yoon Suk Yeol’s impeachment.
U.S. economic data in focus
The Federal Reserve’s favoured indicator of inflation, the U.S. Personal Consumption Expenditures Price Index for February, is released on Friday and should be watched by investors. PMI readings for March, which are released on Monday, and the final U.S. gross domestic product numbers for the fourth quarter, which are released on Thursday, are further economic statistics to keep an eye on. Nevertheless, it is unlikely that markets will move decisively unless Trump takes action.
Other News
An affiliate of Alibaba Ant lowers the cost of AI development by combining Chinese and American chips. According to a source familiar with the situation, Ant Group, an Alibaba affiliate founded by Jack Ma, is utilizing semiconductors made in China and the United States to create more effective artificial intelligence models.
The source noted the industry trend of tapping multiple networks, known as the “mixture of experts,” which enables models to be trained with much less computing. The combination of chips cuts down on the time and cost of training AI models and limits reliance on a single supplier like Nvidia.
In a study published earlier this month, the company claimed to have successfully trained its own MoE models using less expensive hardware, resulting in a 20% reduction in computing expenses.
