Global stock markets were steady on Tuesday as investors awaited the next moves from Donald Trump, after the US president announced tariff rates for more than a dozen of the US’s trading partners.
As countries responded to Trump’s renewed threats, the EU said it hoped to sign a temporary deal with the US this week that would keep tariffs at 10 per cent.
But Germany’s finance minister warned that the bloc stands ready to impose retaliatory measures against if the two parties fail to reach a “fair” deal.
Both Japan and South Korea indicated they would try to negotiate, after they were included in letters sent by the US president to 14 trading partners on Monday setting out the tariffs that would come into effect on August 1. The White House has said more letters will be sent this week.
Speaking late on Monday, Trump left the door open for negotiations, saying that the letters were “more or less” final offers, and “not 100 per cent firm”. He also extended the deadline for the tariffs to go into effect by three weeks to just after midnight on August 1.
Japan’s trade negotiator Ryosei Akazawa spoke to US commerce secretary Howard Lutnick for 40 minutes on Tuesday, and the two agreed to further negotiations.
This week’s move comes after a 90-day pause on the so-called reciprocal tariffs announced by Trump on “liberation day” was set to end on July 9.
Investors were “taking the view that nothing is final and that these letters merely mark another iteration on the journey towards trade deals”, analysts at ING noted.
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In Europe, the Stoxx Europe 600 was flat and the FTSE 100 edged up 0.2 per cent in early afternoon trading.
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Futures tracking the S&P 500 rose 0.1 per cent.
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In Asia, Japan’s Topix closed up 0.2 per cent and South Korea’s Kospi rose 1.8 per cent.
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The US dollar index, which tracks the US currency against a basket of peer currencies, was flat.
