Nasdaq 100 Drops as Signs of Tariff War Damage Appear in Trade Data

Also, 30-year T-bond, silver, crude oil and Japanese yen futures

1. Nasdaq 100 E-mini futures (/NQ): -1.89% 
2. 30-year T-bond futures (/ZB): -0.16% 
3. Silver futures (/SI): +0.86% 
4. Crude oil futures (/CL): +0.45% 
5. Japanese yen futures (/6J): -0.31% 

It’s a turnaround Tuesday, but not in a good way. Stocks are lower across the board in the wake of February Canada inflation data and U.S. import/export price figures, which in aggregate suggest both economies are beginning to feel the strain of Trump’s trade war: Costs for consumers on both sides of the border are rising. The data may be holding back bonds from a stronger move, so traders have turned to a reliable friend: precious metals. Gold is at fresh record highs, while silver prices hit fresh 2025 highs earlier in today’s session. 

Upbeat economic data via industrial production wasn’t enough to keep the two-day rally going in equity markets as trade concerns percolated. Traders are focused on the Federal Reserve meeting that kicks off today. Rate traders don’t expect the Fed to change interest rates, but they’ll be glued to Chair Jerome Powell’s commentary during tomorrow’s press conference. Alphabet (GOOGL) fell 4.3% after announcing that it would acquire Wiz in a deal valued at $32 billion. Tesla (TSLA) fell over 5% after RBC Capital Markets cut its price target on the stock, noting that competition in the EV segment was increasing.  

Treasuries fell along the long-end of the curve, with 30-year T-bond futures (/ZBM5) shedding about 0.2% in early trading. Prices continue to trade in a tight range, with support at the 116’18 level over the past four trading sessions. The Federal Reserve decision may impact bond pricing, as traders attempt to decipher a quickly evolving political landscape around trade restrictions; there is only a 1% chance of a rate cut, which means a surprise is likely to come from Powell’s press conference. The Treasury will auction 20-year bonds today.  

A risk-off move in equity markets is helping to support precious metals prices. Silver futures (/SIK5) rose over 1% this morning. The metal briefly touched the highest level traded since October. Meanwhile, gold prices (/GCJ5) hit a new record high. The recent decline in the greenback has helped to propel metal prices, and risk aversion in stocks is boosting the appeal of the assets as long as stagflation fears remain capped.

Crude oil futures (/CLK5) rose over 1% in overnight trading but those gains were trimmed early in the New York session. President Trump promised to continue military strikes on Houthis in the Red Sea if they don’t stop attacking ships. Meanwhile, upbeat Chinese data has helped to underpin prices, as the country steps in to provide more economic support. Geopolitical pressure is increasing in the market after Israeli air strikes killed 200 people in Gaza, which ended a standoff amid ceasefire talks. The American Petroleum Institute (API) will release crude oil inventory data later today.  

Despite the weakness in U.S. equity markets, the combination of higher energy prices and higher global bond yields has left the Japanese yen (/6JM5) in a relatively weak position. The coming day should prove highly volatile for the yen, insofar as there is a Bank of Japan rate decision this evening (Wednesday in Tokyo) and the Federal Open Market Committee (FOMC) rate decision tomorrow afternoon. Overall, the U.S. dollar ($DXY) is holding near its weakest level since mid-October 2024. 

Christopher Vecchio, CFA, tastylive’s head of futures and forex, has been trading for nearly 20 years. He has consulted with multinational firms on FX hedging and lectured at Duke Law School on FX derivatives. Vecchio searches for high-convexity opportunities at the crossroads of macroeconomics and global politics. He hosts Futures Power Hour Monday-Friday and Let Me Explain on Tuesdays, and co-hosts Overtime, Monday-Thursday. @cvecchiofx
Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. #@fxwestwater
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