Stock Market - Top Things To Watch This Week

Trade Tensions Intensify as Tariffs Loom

Financial markets took a sharp downturn last week, with U.S. stocks sliding further as China hit back against President Donald Trump’s planned 10% tariffs on imports. The deepening dispute has heightened fears of a drawn-out trade war.

The S&P 500 plunged over 10%, marking its steepest weekly decline since 2020. International markets mirrored this negative sentiment, also experiencing significant losses.

The upcoming expansion of U.S. tariffs—slated for 9 April—is widely anticipated to curtail global trade activity. Some economic analysts are now raising concerns about an increased risk of a global recession. In response, the European Union is currently assessing its next steps.

EU officials described their latest talks with Washington as “frank,” and reiterated the bloc's readiness to “defend our interests” should tensions escalate further. Investors will be closely monitoring developments for any signs of either resolution or further escalation.

2. Trump’s Online Rhetoric Fuels Market Volatility

Over the weekend, President Trump continued to publicly defend his aggressive tariff approach, using Truth Social to dismiss market concerns and reaffirm his stance.

He claimed foreign investors are still confident in the U.S. market, asserting that his trade policy would remain consistent. Although he hinted on Thursday that certain nations were eager to secure deals before the tariff deadline, his tone hardened on Friday, as he criticised China’s retaliatory actions.

Trump accused Chinese authorities of “panicking” and reiterated his commitment to halting fentanyl exports from China. Traders are expected to keep a close watch on his social media posts, especially as the EU weighs its strategic response.

3. Earnings Season Begins with Major U.S. Banks

Earnings season gets underway this Friday, with several prominent financial institutions set to report, including BlackRock, JPMorgan Chase, Morgan Stanley, and Wells Fargo.

Despite potential strong earnings figures, market sentiment may remain subdued as attention stays focused on escalating trade tensions. Analysts caution that prolonged uncertainty around U.S.–China relations could overshadow otherwise positive financial results, dampening investor optimism.

4. Inflation Report in Spotlight Amid Tariff Concerns

Thursday’s Consumer Price Index (CPI) release is expected to provide key insight into inflation trends, especially as the latest round of tariffs begins to impact supply chains.

Barclays economists predict the March CPI figure will be “moderate and not significantly influenced by tariffs.” However, they caution that inflation may accelerate in the months ahead, particularly following the 2 April implementation of the so-called “Liberation Day” tariffs.

“If our projections are accurate, this could be among the least severe inflation readings of the year,” Barclays noted. The report could influence the Federal Reserve’s interest rate decisions in May, although persistent inflation driven by protectionist policies may complicate future monetary policy.

5. TikTok Sale Deadline Extended Amid Ongoing Trade Talks

President Trump has extended the deadline for ByteDance to divest its U.S. TikTok operations by an additional 75 days, pushing the new deadline into mid-June. He cited the need for more time to finalise regulatory approvals, while reaffirming ongoing national security concerns.

ByteDance has confirmed that negotiations with U.S. officials are continuing. Several companies—including Amazon, Oracle, and Applovin—have expressed interest in acquiring TikTok’s American assets.

Trump also linked the TikTok decision to broader trade discussions with China, stating he hoped to continue negotiations “in Good Faith.” Any significant developments in this matter could introduce further volatility to markets already on edge due to mounting geopolitical risks.

(Sources: investing.com, reuters.com)