Global markets are expected to be influenced by a mix of factors, including the ongoing trade war and potential government deals. The US-China trade tensions remain a concern, with Chinese policymakers promising more fiscal stimulus if a trade war ensues.
Meanwhile, investors have been subdued due to the raging Trump-led trade war, with some indexes losing 2% this week and oil prices at six-month lows. However, Wall Street is poised to open higher on Wednesday following a sell-off on Tuesday.
Germany’s next government has given reason for optimism, with landmark agreements to create a 500 billion euro infrastructure fund and loosen fiscal rules to boost defense spending. The European Commission has also proposed borrowing up to 150 billion euros to lend to EU governments under a rearmament plan.
The situation in Ukraine remains volatile, but U.S. President Donald Trump’s reconciliatory letter to Ukrainian President Volodymyr Zelenskiy may have brought the conflict closer to resolution. However, Trump has also advocated scrapping a bipartisan law giving $52.7 billion in subsidies for semiconductor manufacturing.
On Wednesday, investors will be watching earnings announcements from Adidas and Bayer, as well as PMIs from the US, UK, Germany, France, and the euro zone. The Euro zone producer prices and US ADP employment report are also scheduled to be released.
Source: https://www.reuters.com/markets/europe/global-markets-view-europe-2025-03-05