Midweek trading on Wednesday, 5 March 2025, will be driven by key economic data, central bank signals, and corporate developments. Investors will closely watch inflation trends, labour market conditions, and global economic indicators for clues on market direction.
KEY INDICATORS
Eurozone retail sales (January)
A key indicator of consumer spending, this data will help gauge economic activity in the Eurozone amid ongoing monetary policy adjustments by the European Central Bank (ECB).
Federal Reserve commentary
Several Fed officials are expected to speak, and their views on inflation, labour market strength, and interest rates could impact market expectations for future policy moves.
US services PMI (February final reading)
The latest reading of the ISM services PMI will provide insights into the strength of the US services sector.
A strong report could reinforce expectations of economic resilience, while a weaker reading may raise slowdown concerns.
MARKET MOVERS
GBP/USD
Possible long preference Long positions above 1.28468 with targets at 1.28618 & 1.28818 in extension. Alternative scenario Below 1.28189 look for further downside with 1.27985 & 1.27687 as targets. The immediate trend remains up and the momentum is strong.
European stocks rebound from sharp selloff; tariffs compromise possible?
European stock markets rose on Wednesday, rebounding after the previous session’s rout amid hopes for a compromise on US trade tariffs on Mexico and Canada, even after President Donald Trump touted the moves during an address to Congress.
At 8:05 AM GMT, the DAX index in Germany climbed 2.2%.
The CAC 40 in France gained 1.4%.
The FTSE 100 in the UK rose 0.4%.
President Trump’s decision to impose fresh US tariffs of 25% on Canada and Mexico, as well as an additional 10% tariff on Chinese goods, has rattled global market sentiment amid concerns that they will reignite inflation and escalate a global trade war.
Japan stocks drop 1.2%, leading declines in Asia as trump tariffs dent sentiment
Japanese stocks led declines in Asia-Pacific markets after US President Donald Trump made it clear that tariffs on Mexico and Canada would go into effect as planned.
The benchmark Nikkei 225 index plunged 1.20% to end the day at 37,331.18, while the broader Topix index lost 0.71% to close at 2,710.18.
Japan’s unemployment rate for January came in at 2.5%, slightly higher than Reuters’ estimate of 2.4%.
South Korea’s Kospi index ended the day 0.15% lower at 2,528.92, while the small-cap Kosdaq retreated 0.81% to 737.90.
USD/JPY
Possible long preference Long positions above 149.541 with targets at 149.722 & 149.981 in extension. Alternative scenario Below 149.073 look for further downside with 148.737 & 148.486 as targets. Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
TODAY’S NEWS HEADLINES
Dollar falls further on trade jitters; euro helped by stimulus talks
The US dollar fell further on Wednesday, dropping to a three-month low amid concerns that a trade war triggered by US President Donald Trump will impact the world’s largest economy, while the euro soared on the prospects of major fiscal stimulus.
At 9:00 AM GMT, the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.6% lower at 105.060, near its weakest level since early December.
GBP/USD rose 0.4% to 1.2848, climbing to a three-month high, boosted by dollar weakness.
Oil drops for third day on OPEC+ output increase, Trump tariffs
Oil prices declined for a third consecutive session on Wednesday, as investors worried about OPEC+ plans to proceed with output increases in April, while US President Donald Trump’s tariffs on Canada, China, and Mexico escalated trade tensions.
Brent futures fell 45 cents (0.63%) to USD 70.59 a barrel at 9:53 AM GMT.
US West Texas Intermediate (WTI) crude declined 74 cents (1.08%) to USD 67.52 a barrel.
Meanwhile, the Organisation of the Petroleum Exporting Countries and its allies, including Russia—a group known as OPEC+—decided on Monday to increase output for the first time since 2022, further pressuring crude prices.
Gold prices tick down on firmer dollar, tariff tensions limit losses
Gold prices edged lower in Asian trading on Wednesday as the US dollar ticked up, though escalating trade tensions following President Donald Trump’s tariff announcements kept losses in check due to sustained safe-haven demand.
Spot gold inched 0.2% lower to USD 2,912.00 per ounce.
Gold futures expiring in April gained 0.1% to USD 2,922.72 an ounce by 4:28 AM GMT.
Platinum futures edged up 0.2% to USD 973.35 an ounce.
