Investors cheered news that the US will limit the range of tariffs it imposes next week, with electric vehicle carmaker Tesla leading the tech-heavy Nasdaq Composite higher.
US President Donald Trump’s reciprocal tariff regime against the world set to take effect on April 2 won’t be as wide-ranging as previously feared, with industry-specific import levies pushed out and the White House set to target the 15% of nations running persistent trade surpluses against the world’s biggest economy.
Tesla led the Nasdaq higher, climbing 10% in late trading, having unwound most of its gains since Trump’s election in November through Wall Street’s recent slump.
The Nasdaq was up 2% in afternoon trading, while the S&P 500 increased 1.5%.
“Market reaction to these reports has been positive for risk appetite, with stronger US equity futures and higher US Treasury yields during the Asian trading session, with gains extended overnight,” Bank of New Zealand senior markets strategist Jason Wong said in a note.
And while the White House pulled back from a wide reciprocal tariff regime, Trump announced a 25% tariff on any country that buys oil or gas from Venezuela, effective from April 2. Brent crude oil futures edged up 0.1% to US$72.21 a barrel.
Testing times
Meanwhile, DNA-testing startup 23andMe more than halved in value after filing for bankruptcy on Sunday in the US after struggling to find a profitable business model in that customers only ever needed to take a test once.
And data and analytics firm Dun & Bradstreet agreed to a US$7.7 billion deal with private equity suitor Clearlake Capital, ending its second stint as a public company.
Stock markets were subdued in Europe as investors continued to fret over the Trump regime’s tariff programme, while German software firm SAP overtook Denmark’s Novo Nordisk as the continent’s most valuable company.
German agriculture and pharmaceutical firm Bayer fell 6.9% after a Georgia jury ordered it to pay US$2.1 billion in its latest legal defeat relating to the Roundup weedkiller.
Separately, Germany’s agriculture ministry said on Monday that Britain has ended a ban on imports of livestock and animal products that’s been in place since a case of foot-and-mouth disease was discovered in Germany in January.
The revival in risk appetite is expected to flow to the antipodes, with Australian futures pointing to a 0.4% increase for the S&P/ASX 200 index. The kiwi dollar traded at 57.17 US cents at 7am in Auckland from 57.20 cents.
There’s no major data on the radar locally, while across the Tasman the federal government is due to release its budget on Tuesday.
Reporting by Paul McBeth. Image from Bram Van Oost on Unsplash.
