Global stock markets were mostly steady or slightly higher on Tuesday as investors reacted calmly to the latest update on U.S. President Donald Trump’s tariff plans.
On Monday, Trump sent letters to 14 countries, including major Asian trade partners like Japan and South Korea, announcing much higher tariffs on imports to the US.
However, the market response has been more cautious this time, unlike the sharp drops seen three months ago on “Liberation Day.” This is because many expect countries to work on trade deals with the US before the new August 1 deadline.
In Europe, the STOXX 600 index stayed mostly unchanged, while the euro rose 0.4%. Reports suggest the EU won’t receive a letter about higher tariffs and could finalize a trade deal by Wednesday.
The EU aims to secure a temporary trade deal with the U.S. this week, which would lock in a 10% tariff rate past the August 1 deadline while working on a long-term agreement. Meanwhile, Bulgaria is set to take the final step to join the Eurozone as its 21st member next year, with EU finance ministers meeting on Tuesday to approve its application.
On the FX front, the euro hit a one-year high against the yen and was last up 0.4% on the day at 171.745.
The euro rallied against the dollar as well, rising 0.4% to 1.1735, partially recouping Monday’s 0.67% loss.
The Australian dollar was the star performer on Tuesday, jumping over 1% after the Reserve Bank of Australia surprised markets by keeping interest rates unchanged. It was last up 0.8% at 0.6545.
The New Zealand dollar rose 0.38% to 0.60245, while the British pound increased 0.3% to 1.3642.
China’s yuan briefly dropped to a two-week low against the dollar due to renewed worries about US tariffs. However, it bounced back after major state-owned banks stepped in to support the currency.
Currency Power Balance