Market Rundown: Tariffs Impact Stocks and Bonds, China's Financial Moves

Global Tariffs and Trade Negotiations

• 🌍 Punitive duties on goods from around the world have taken effect, impacting international trade.
• 🇨🇳 China's central bank has instructed state-owned banks to reduce dollar purchases and increase yuan buying to stabilize financial markets.
• 🇯🇵 Japan and South Korea are among the first countries planning talks with the Trump administration to address tariffs.
• 🇺🇸 US demands may extend beyond tariffs, potentially including allowing the yen to rise against the dollar and addressing digital services taxes aimed at US tech giants.

Bond Market Sell-off

• 📈 The US 10-year Treasury peaked at 4.49% overnight, marking a significant sell-off of US debt.
• ⚠️ This spike in borrowing costs suggests investors are moving out of even the safest assets into cash.
• 📉 US 30-year bonds have experienced their heaviest sell-off since 1981.

TSMC and US Export Controls

• 🏭 TSMC, a Taiwanese semiconductor manufacturer, faces a potential billion-dollar fine in a US export control investigation.
• 📱 The investigation concerns how one of its chip designs ended up in a Huawei AI processor.
• 🇹🇼 Taiwan has been hit with a 32% duty, highlighting the reach of US crackdowns beyond direct tariffs, even on allies.