To The Moon

Tariff Confirmation Triggers Wall Street Decline, While Asian Markets Rise on Optimism Ahead of China's National People's Congress

🇺🇸 S&P 500: -1.75% 📉

🇺🇸 Nasdaq: -2.64% 📉

🇪🇺 Stoxx 600: +1.07% 📈

🇯🇵 Nikkei 225: +1.70% 📈

🇭🇰 Hang Seng: +0.28% 📈

🇨🇳 CSI 300: -0.04% 📉

🇸🇬 Straits Times: +0.34% 📈

The US stock market saw a sharp decline, dragged down by a selloff in tech stocks. The S&P 500 and Nasdaq Composite fell 1.8% and 2.6%, respectively. This followed President Donald Trump's announcement that the US will impose a 25% tariff on imports from Canada and Mexico starting Tuesday, with no negotiations allowed.

In February, US manufacturing activity remained stable, with PMI slipping from 50.9 to 50.3, below market expectations. Meanwhile, factory output prices surged to a nearly three-year high, and longer material delivery times signaled potential disruptions from upcoming tariffs.

Eurozone inflation fell from 2.5% in January to 2.4% in February, nearing the European Central Bank's 2% target. This increased expectations of a rate cut on Thursday, as supporting weak economic growth takes priority over inflation concerns.

Asian markets closed higher. Hong Kong's Hang Seng Index rose 0.3% as China's manufacturing activity expanded at the fastest pace in over a decade, boosting investor confidence ahead of the National People's Congress. Japan's Nikkei 225 jumped 1.7%, benefiting from last week's strong Wall Street performance.

China's Caixin Manufacturing PMI rose from 50.1 in January to 50.8 in February, beating expectations and showing resilience despite new US tariffs. Policymakers are expected to announce increased fiscal stimulus at the upcoming legislative meeting.

Japan's manufacturing activity contracted for the eighth consecutive month, with February's PMI improving slightly from 48.8 to 49.0. Weak demand and rising costs for raw materials, labor, and utilities, along with currency fluctuations, drove prices higher.

Upcoming Events

Tuesday: Bank of Japan Governor Ueda's speech will be closely watched by investors.

Wednesday: Key economic data releases from China and the US, including China's Caixin Services PMI, US ADP Nonfarm Employment Change, and ISM Services PMI.

Thursday: The US will release jobless claims, while the European Central Bank will hold a press conference and issue a monetary policy statement. 

Friday: The US will release unemployment and nonfarm payroll data.

Key Developments Today

1. President Donald Trump announced a 25% tariff on imports from Mexico and Canada starting Tuesday. He also reiterated plans to raise tariffs on all Chinese imports from 10% to 20%, citing China's continued fentanyl exports to the US. The countertariffs will take effect on April 2, with no negotiations allowed.

2. Nvidia $NVIDIA Corp(NVDA)$  and Broadcom $Broadcom(AVGO)$   are testing Intel's $Intel(INTC)$  advanced 18A manufacturing process, signaling potential interest in Intel's foundry business. Intel aims to regain competitiveness in the semiconductor industry after past delays and struggles to attract major clients.

Nvidia and Broadcom in Intel

3. TSMC $Taiwan Semiconductor Manufacturing(TSM)$ announced a $100 billion investment in the US, including five new semiconductor plants, advanced packaging facilities, and an R&D center. This move aims to strengthen domestic chip production and reduce reliance on Asian manufacturing.

100 billions US investment by TSMC

4. BYD $BYD COMPANY(01211)$  is conducting its largest post-listing stock sale, aiming to raise up to $5.2 billion. The stock is priced at an 8.4% discount to the market, with proceeds supporting R&D, global expansion, and financial stability amid rising competition in the EV sector.

BYD

5. NationGate Holdings Bhd's stock plunged 29.7% to RM1.30 after reports emerged that Singapore is investigating potential fraud involving Nvidia chip shipments. However, NationGate's co-founder clarified that the probe targets Nvidia's cloud computing partner and is unrelated to the company itself.

Nationgate limit down

Key Takeaways

The tariff issue is weighing on stock markets and could continue to limit market gains until there is more clarity on US trade policy.

@Daily_Discussion  @TigerStars  @Tiger_comments  @TigerGPT