Market Update: Tariffs Spark Sell-Off, Treasury Yields Rise, and Bitcoin Gains

Image Source : Krish Capital Pty Ltd

Index Update

The Trump administration's 25% tariff on non-US-made cars, set for April 2, sparked concerns about economic impact and inflation, triggering a market sell-off. General Motors fell over 6%, Ford dropped 1.8%, while Tesla gained nearly 1% due to its US-based production. Other major tech stocks had mixed performances, with Apple, Nvidia, Amazon, and Meta declining, while Microsoft and Alphabet remained steady.

Market Movers

On Wednesday, the top gainers were WAVE Life Sciences Ltd (+13.56%), followed by Playtika Holding Corp (+12.5%). On the contrary Humacyte, Inc (-29.39%) and Acrivon Therapeutics, Inc (-18.18%) declined the most the same day.

Commodities Update

WTI crude oil futures fell to around $69 per barrel as traders assessed the impact of US auto tariffs, which could reduce crude demand. However, prices remained supported by US sanctions on key producers like Iran and Venezuela. India’s Reliance Industries plans to halt Venezuelan oil imports due to US tariff threats. Meanwhile, US crude stockpiles saw their sharpest decline since December, dropping by 3.34 million barrels, signaling strong demand.

Macro Update

The US 10-year Treasury yield rose 6 bps to 4.39%, its highest in nearly a month, amid trade war concerns. The Trump administration announced a 25% tariff on non-US-made cars, with Trump warning of larger tariffs on the EU and Canada if they retaliate. Fears of economic harm and inflation grew as consumer confidence hit a four-year low and core capital goods orders fell 0.3%, missing expectations. Investors now await Q4 GDP data, jobless claims, and the upcoming PCE report.

Futures Update

US futures hovered near the flatline Thursday after a weak session where the Nasdaq fell 2% and the S&P 500 dropped 1.1%. Traders reacted to the Trump administration's 25% tariff on all non-US-made cars, effective April 2. President Trump also warned of even higher tariffs on the EU and Canada if they retaliated.

Bitcoin traded at $87,174 on March 27, rising 0.30% from the previous session. Over the past four weeks, it gained 3.34%, and over the last 12 months, it increased by 23.30%. 

On Wednesday, stocks saw a significant decline, reversing recent gains, with the tech-heavy Nasdaq experiencing the most pressure. The Nasdaq fell 372.84 points (2.0%) to close at 17,889.01, while the S&P 500 decreased by 64.45 points (1.12%) to 5,712.21. The S&P 500 is encountering resistance at higher levels, suggesting further potential declines ahead, with key support identified at approximately 5,603 and resistance at 5,787. The 14-period RSI is also beginning to reverse from the midpoint, indicating a likelihood of a pullback.