World
Markets Steady as China Retaliates with Tariff Hike Amid Global Economic Jitters
U.S. stocks inched higher on Friday despite volatile trading triggered by renewed tensions in the global trade war, as China announced a steep increase in tariffs on American goods. The move came in response to the latest round of U.S. tariffs introduced by former President Donald Trump earlier this month.
The Dow Jones gained 67.71 points to close at 39,647.37, while the S&P 500 and Nasdaq rose 0.28% and 0.44%, respectively, led by gains in tech stocks. Investors remained cautious amid sharp swings in the bond market, with 10-year U.S. Treasury yields rising to 4.535%, their largest weekly jump in over four decades.
China’s retaliation saw tariffs on U.S. imports spike from 84% to 125%, rattling investor confidence and pushing global markets lower. The MSCI global stock index fell 0.20%, while Europe’s STOXX 600 dipped 0.13%.
Adding to the economic uncertainty, U.S. consumer sentiment plunged in April, and monthly producer prices unexpectedly declined in March. Meanwhile, major U.S. banks reported better-than-expected earnings, offering some support to the markets.
Safe haven assets benefited from the turmoil. Gold soared to a new record high above $3,230 per ounce, posting a weekly gain of over 6%. The dollar weakened against major currencies, with notable declines against the euro, yen, and Swiss franc.
Analysts noted increased bond sell-offs during the week, triggered by margin calls and fears of further liquidations, though strong government debt auctions helped stabilize the market somewhat.
Despite the turbulence, investors are closely watching for signs of improved liquidity and clearer direction from central banks as trade tensions and inflation worries continue to weigh on global sentiment.
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