Markets Gain On Euro Data, Eyes on Trump’s Speech

While European markets are experiencing a technical rise, attention turns to Washington. Supported by encouraging economic indicators, the main stock indices of the Old Continent closed in the green this Tuesday. However, this improvement remains fragile. Investors are holding their breath ahead of potentially decisive announcements from Donald Trump, who could reignite the U.S. trade offensive. The prospect of new tariff barriers rekindles tensions and threatens to reshuffle the cards of the global economic balance.

A rebound of indices driven by economic figures

The European stock exchanges ended significantly up this Tuesday, driven by economic data deemed encouraging in the eurozone.

The CAC 40 climbed by 1.15 % to 7880.1 points, the German DAX gained 1.67 %, and the British FTSE rose 0.61 %. This increase is primarily explained by a deceleration of inflation in the eurozone in March, which fuels hopes for a more accommodative monetary policy from the ECB.

Inflation is slowing down, paving the way for a more flexible ECB, while the EuroStoxx 50 index also recorded a gain of 1.49 %. This context has rekindled appetite for risky assets, which has influenced bond markets.

Among the key elements that supported the markets this Tuesday, there are:

• The decline in bond yields, particularly in the United States, where the 10-year rate fell to 4.1613 % (-8.4 bp), reflecting increased demand for safe haven assets ;
• A technical support related to price relaxation in Europe, in contrast to the American trend ;
• The strong performance of several stocks in Europe : Solutions30 jumped by +10.7 % after confirming its targets for 2026, Schneider Electric gained +2.4 % following a rating upgrade from HSBC, while L’Oréal was added to Goldman Sachs’ “conviction” list, progressing by +3 % ;
• Watchful movements in the currency market, as the euro slightly fell to 1.0807 dollars, in a context of caution ahead of U.S. announcements.

The day’s rise is therefore not a reflection of genuine enthusiasm, but rather a tactical positioning in the face of a European central bank likely to ease its policy, as the U.S. economy shows signs of critical slowing.

A Trump announcement that could shake the foundation

The relative optimism observed in the markets hides a deeper concern related to American trade policy. President Donald Trump is set to speak this Wednesday. He is expected to impose a 20 % increase in tariffs on nearly all American imports.

This measure would mark a significant escalation in his nationalist economic agenda. “Trump is implementing his program strongly, without worrying about disruptions in financial markets,” summarizes Alexandre Hezez, a strategist at Banque Richelieu. He adds that “his back-and-forths reduce the confidence of economic players and force central banks to adjust their strategy.”

The American economic situation exacerbates these tensions. The ISM manufacturing index, published on Tuesday, fell into contraction territory, illustrating a deterioration of industrial activity.

At the same time, companies are reporting a surge in input prices, which have reached a peak since June 2022, a situation that could be amplified by a more aggressive tariff policy.

Trump, facing a slim majority in the House of Representatives, seeks to “massively cut spending” and to “demonstrate the positive effects of his policy for American households,” even at the risk of “creating a significant short-term deterioration,” according to Alexandre Hezez.

This stated positioning could place the Fed in a delicate situation and affect global economic stability in the long run.

If the announced measures are realized, the repercussions could be multiple. In terms of trade, they risk provoking retaliation, exacerbating tensions with China or the European Union, and fueling imported inflation. On the market level, they could further erode confidence and push investors towards safe-haven assets like gold, sovereign bonds… or cryptos.