Stock markets were set for their best month since late 2023 on Friday, while the dollar was gearing up for its first monthly rise of the year as traders awaited key inflation data and assessed the impact of the legal dispute on tariffs.
Markets have been volatile this week as investors assessed the decision by the U.S. court to block most of President Donald Trump’s tariffs, and a decision of a federal appeals court to temporarily reinstate them.
Dollar set for first positive month this year
MSCI’s main world index gained over 5 percent this month, while the dollar, which was up 0.3 percent on Friday, is heading close to its first positive month this year. This rise was supported by benchmark 10-year U.S. Treasury yields rising 0.5 basis points in European trade.
Investor sentiment had been impacted by Trump’s budget bill that would allow the government to impose taxes of up to 20 percent on foreign investment.
In the Japanese stock market, the Nikkei saw profit taking overnight after its near 2 percent rally the previous day, with investors also concerned about Japanese debt levels and the impact of tariffs.
The yen appreciated 2 percent from its low on Thursday and was exchanging at around 144 per dollar in London. Meanwhile, the euro and pound were down 0.3 percent and 0.1 percent at $1.13 and $1.34, respectively.
Read: Oil falls 0.48 percent, prices set for weekly drop with tariffs and OPEC+ in focus
Korean stocks post best month since November 2023
In the Asian stock market, Hong Kong’s Hang Seng dropped 1.2 percent, with Apple suppliers impacted by the U.S. tariff reversal. Mainland Chinese blue chips also fell 0.5 percent, although both marked solid monthly gains. Meanwhile, Korean stocks performed better, recording their best month since November 2023 in line with the main world index.
The MSCI International Emerging Markets index has also gained about 2 percent for the month. That was also its best since November 2023.
Despite tariff concerns, the Trump administration said negotiations with top trading partners were in progress. Treasury Secretary Scott Bessent said during a recent interview that he was scheduled to have talks with a high-level Japanese delegation on Friday in Washington, although he said talks with China were “a bit stalled”.
