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For the past month and a half, the answer to this question has been pretty much the same: investors are very attentive to Donald Trump’s statements, which have not exactly been reassuring, at least for the bulls.
The biggest concern centers on trade wars, with new tariffs set for April 2. This uncertainty will likely keep pressure on the S&P 500 and risk assets in general, pending further updates on Trump’s plans.
Geopolitical tensions are also in focus, as the president’s team works to reach a peace deal between Russia and Ukraine, tensions in the Middle East flare up, which could be positive for safe-haven assets such as gold.
Beyond threats directed at Hamas, the White House is pushing for nuclear negotiations with Tehran. If those talks fail, U.S.-Iranian relations could suffer a major setback with direct consequences.
In particular, recently, the media has speculated about a preemptive strike against Iranian nuclear facilities. Should this occur, in addition to XAUUSD, energy markets could experience significant volatility.
Oil and gas prices could also surge if the United States intensifies sanctions against Russia after unsuccessful negotiations. In fact, a bill to tighten sanctions has already been introduced in Congress.
On the macroeconomic front, key data this week will focus on the labor market and US inflation:
- The JOLTS job openings report will be released on Tuesday, followed by jobless claims on Thursday.
- The consumer price index will be published on Wednesday and the PPI on Thursday.
The debt market is under scrutiny in Europe following a historic drop in German bonds – the largest in 35 years – after Germany announced a new €150 billion loan program and a €500 billion infrastructure fund.
With plenty of market-moving events ahead, volatility is likely to stay elevated.
