Wednesday's Markets Update (March 12, 2025)

13 Mar 2025 by rate3

On Wednesday, equities are mixed in response to retaliatory tariffs and an unexpected softening of the inflation rate to 2.8 from 3.0 for the first time in 6 months, driven by a decrease in energy costs (except for natural gas) and a smaller increase in shelter and transportation indexes. The government budget deficit (-$307B) continues to mount due to debt payments.

World's Markets:

EU stocks halted a 3-day downward streak, primarily due to the absence of extreme negativity and supported by an increased likelihood of a potential ceasefire. Retail growth in Spain continued to slow, particularly in non-food products. German bond yields reached a over 10-year high in anticipation of increased state borrowing.
Brazilian inflation continues to climb, reaching a 17-month high of 5.06%, driven by energy prices, which have been somewhat softened by government credits, as well as housing costs. Meanwhile, stocks are rising based on technical factors.
Indian industries grew beyond expectations, particularly in petroleum, minerals, and textiles. Despite this, stock indexes continue to decline as tech stocks fell following downgrades by leading brokers.
Chinese stocks are in decline as tech momentum wanes after the end of the CCP session.
Japan's market stalled due to a 6-7% monthly wage hike deal between major corporations and their workers (30% of the country's labor force), opening the door for more BOJ rate hikes as inflation is expected to rise as a result.
Commodities and Currencies:

The sea freight index continues its rally, reaching a 3-month high as producers worldwide stockpile materials ahead of impending tariffs. Aluminum prices reached a 9-month high following Trump's 25% tariffs, which significantly impact the American market, which imports 80% of its aluminum needs. The euro hit a 4-month high amid renewed hopes for a one-month ceasefire deal.
Crypto:

BTC, ETH, and SOL have slightly softened their declines, reaching their 5-6 month lows.

The State Of Markets: Mixed, American and EU markets are mostly in the green, supported by a technical correction and easing inflation (which is almost certainly temporary), as well as renewed hopes for peace. In contrast, stock indexes in Asia are mostly down or stalled due to rising inflation and slowing economies.