US stocks closed lower Thursday as President Trump reignited global trade tensions with a sweeping 25% tariff on all foreign-made vehicles. While the president described the move as “very lenient,” threats of additional duties on the EU and Canada shook investor confidence. Auto stocks led the declines on Wall Street, with broader weakness spreading across industrials and consumer discretionary sectors. European markets followed suit, while Asia traded mixed amid optimism. Treasury yields edged higher and gold surged to a record close, reflecting rising demand for safe havens. Though jobless claims offered reassurance about labour market strength, the April 2 tariff deadline still clouds the outlook.

Key Takeaways:

  • Dow Falls for Second Day as Auto Stocks Slide: The Dow Jones Industrial Average fell 155.09 points, or 0.37%, to 42,299.70. Automakers dragged the index lower, led by a 7% drop in General Motors and a 4% decline in Ford. Despite Thursday’s loss, the Dow is still up 0.8% for the week, although sentiment remains fragile.
  • S&P 500 Edges Lower on Industrial Weakness: The S&P 500 slipped 0.33% to 5,693.31, as declines in industrial and consumer-focused names outweighed strength in defensives. Auto-related names weighed on the index as traders evaluated the economic fallout of Trump’s tariff strategy. The index remains up 0.5% this week but is showing hesitation near recent highs.
  • Nasdaq Drops as Growth Momentum Cools: The Nasdaq Composite declined 0.53% to 17,804.03, with high-growth tech stocks under pressure. Despite a modest gain in Tesla, semiconductor and software names lost ground amid concerns about a slowdown in consumer spending. The Nasdaq is up just 0.1% so far this week, pausing after its recent rally.
  • European Markets Slide as Auto Sector Sinks: European equities closed broadly lower on Thursday as Trump’s auto tariff announcement weighed heavily on investor sentiment. The Stoxx 600 fell 0.44%, with the autos subindex down nearly 1%. Germany’s DAX slid 0.74%, with BMW and Mercedes-Benz dropping more than 2.5%. France’s CAC 40 lost 0.54%, while Italy’s FTSE MIB tumbled 0.78%. The FTSE 100 slipped 0.27%, despite a 10.5% gain in Next following strong annual earnings. Rising gilt yields also pressured UK markets, as the 10-year UK bond yield climbed 5 basis points after the government issued a fiscal update.
  • Asian Markets Mixed as Investors React to Trade Uncertainty: Asia-Pacific stocks showed mixed performance as traders weighed the implications of US auto tariffs. Japan’s Nikkei 225 fell 0.6% to 37,799.97, while the broader Topix was flat at 2,815.47. South Korea’s Kospi dropped 1.39%, and the Kosdaq lost 1.25%, with tech and auto exporters under pressure. In China, the CSI 300 rose 0.33% and Hong Kong’s Hang Seng gained 0.41%, lifted by hopes of stimulus support. India’s Nifty 50 rose 0.45% and the Sensex gained 0.49%, while Australia’s ASX 200 declined 0.38% as energy stocks lagged.
  • Jobless Claims Show Stability Despite Broader Risks: Initial claims for unemployment benefits fell by 1,000 to 224,000 for the week ending March 22, in line with expectations. Continuing claims dropped by 25,000 to 1.856 million, suggesting ongoing labour market resilience. The Labor Department revised seasonal adjustment models through 2025, updating historical data. Economists expect the unemployment rate to hold steady at 4.1% in March.
  • 10-Year Treasury Yield Rises on Trade Risk Repricing: The 10-year US Treasury yield edged up to 4.365%, rising just over two basis points as investors reassessed long-term risks related to tariffs and global growth. The 2-year yield slipped to 3.996%, reflecting stable short-term expectations. While yields remain below recent highs, traders are increasingly cautious about inflation and fiscal spillover effects in a tariff-heavy policy environment.
  • Oil Prices Firm as Inventories Fall and Sanctions Bite: Brent crude added 14 cents to settle at $73.93, while WTI rose 15 cents to $69.80. Prices were supported by a 3.3 million-barrel draw in US crude inventories and the Biden administration’s new sanctions on Venezuelan exports. India’s Reliance Industries is reportedly halting purchases, tightening supply further. Analysts remain wary of trade-related demand risks, keeping gains in check.

FX Today:

  • EUR/USD Rebounds from 200-Day SMA as Losses Ease: EUR/USD gained 0.40% to settle at 1.0796, bouncing back after testing its 200-day SMA at 1.0729. Thursday’s recovery followed a four-day decline that pulled the pair away from March’s high near 1.0940. The intraday low of 1.0732 held firm, suggesting buyers are stepping in at long-term support. The broader technical structure remains constructive, with the 50-day and 100-day SMAs positioned well below current price levels. A close above 1.0850 would confirm bullish continuation, while a drop below 1.0720 would shift the focus to 1.0650. 
  • GBP/USD Pushes Toward 1.3000 as Bulls Regain Control: The British pound rose 0.49% to close at 1.2951, posting its second consecutive gain and moving within striking distance of the key 1.3000 resistance level. The pair has been consolidating just below this threshold following a strong March rally that lifted it from 1.2600. Price remains supported above all major moving averages, with the 50-day SMA trending higher at 1.2663, and both the 100-day and 200-day SMAs flattening out. A sustained break above 1.3000 could trigger a fresh bullish leg toward 1.3100 and beyond. On the downside, initial support lies at 1.2880, followed by more substantial demand around 1.2800.
  • USD/JPY Extends Rally as Momentum Targets 152.00: USD/JPY advanced 0.32% to close at 151.04, marking its fifth straight daily gain as bullish momentum continued to build. The pair rebounded from a low of 150.06, pushing back toward resistance at 152.00—a level that capped price action in January and February. USD/JPY is now testing the 200-day SMA at 151.66, having already cleared the 50-day SMA at 151.44 earlier this week. Traders are watching for a decisive break above 152.00, which could shift the medium-term outlook back to bullish and set the stage for a move toward 153.00. Failure to clear resistance may lead to renewed downside pressure, with initial support seen around 150.00 and 148.50 below that.
  • USD/CAD Holds Steady as Range Remains Intact: USD/CAD climbed 0.32% to 1.4311, recovering from a session low of 1.4259 but remaining stuck in the wide horizontal range that has defined price action since February. The pair remains supported by the 100-day and 200-day SMAs, which continue to provide a solid base around 1.3967. However, upward momentum has been capped repeatedly near the 50-day SMA at 1.4333. A break above that level would open the door to a retest of the 1.4450–1.4500 resistance band, while downside risks re-emerge on a drop below 1.4250. 
  • Gold Hits Record Close as Trade Risks Drive Safe-Haven Demand: Gold surged 1.27% to end at $3,057.55, marking its highest daily close since mid-March and reinforcing its strong uptrend. The metal rebounded sharply from a weekly low of $3,012.41, registering an intraday high of $3,059.77 as geopolitical and trade tensions drove investors toward safety. Technical indicators remain firmly bullish, with gold holding well above its 50-day, 100-day, and 200-day SMAs—all of which are rising. The $3,020–$3,000 zone has provided strong support, while upside targets now extend toward the $3,080–$3,100 area. Traders are watching closely to see if a clean breakout above $3,060 can spark another leg higher in the rally.

Market Movers:

  • Auto Stocks Tumble on Tariff Shock: General Motors sank 7%, Ford fell 4%, and Stellantis dropped 1% after Trump’s announcement of a 25% tariff on all foreign-made cars. Tesla gained 0.4%, seen by analysts as a relative beneficiary due to its US-based production footprint.
  • GameStop Plunges on Convertible Note Sale: Shares of the video game retailer tumbled 22%, reversing a 12% rally from the previous day. The company announced plans to raise $1.3 billion via the sale of convertible notes to purchase bitcoin, alarming investors and reviving concerns about speculative strategy risks.
  • Alibaba Advances on AI Model Release: US-listed shares of Alibaba rose nearly 3% following the launch of its new open-source AI model “Qwen2.5-Omni-7B.” The model supports multimodal input and can run on edge devices such as smartphones, expanding Alibaba’s competitive reach in artificial intelligence applications.
  • Petco Surges on Strong Forecast: Petco shares soared 32% after the company projected full-year adjusted EBITDA between $375 million and $390 million, topping consensus estimates of $371 million. The upbeat outlook comes amid renewed investor focus on the pet care sector.
  • Soleno Therapeutics Soars on FDA Approval: Shares of the biotech firm surged 38% after the FDA approved its drug VYKAT XR for treating hyperphagia in patients with Prader-Willi Syndrome, a rare genetic disorder. The decision marks a significant milestone for the company.
  • Concentrix Spikes on Strong Quarterly Results: Concentrix shares jumped 42% after the company reported Q1 earnings of $2.79 per share on $2.37 billion in revenue, beating expectations. Analysts had forecast earnings of $2.58 and $2.36 billion, respectively.
  • TD Synnex Falls on Weak Outlook: The IT solutions firm dropped 14% after missing Q1 estimates and guiding below analyst expectations for Q2 earnings and revenue, citing softer enterprise demand and customer delays.

Thursday’s declines revealed how sensitive markets remain to trade headlines and policy surprises. While economic data like jobless claims and oil inventories showed resilience, they were overshadowed by fears of retaliatory measures and global economic fragmentation. Investors rotated into safe-haven assets, lifting gold to a record close and nudging bond yields higher as longer-term risks were repriced. As the April 2 tariff implementation date approaches, markets may face further volatility unless clearer trade guidance emerges. With inflation still elevated and earnings season approaching, the path ahead remains uncertain and likely bumpy.