Market Jitters as Trump's Tariff Talk Reshapes Global Economy

Global markets experienced significant shifts on Monday following U.S. President Donald Trump's decision to delay imposing 50% tariffs on European Union goods. This move, initially surprising investors, created temporary trade policy relief, allowing MSCI's broadest index of world shares to rise by 0.2% and aiding a 0.9% recovery in the pan-European stocks index.

On Sunday, President Trump extended the tariff deadline to July, indicating the need for more negotiations. Analysts warn that investor behavior is pivoting from U.S. markets towards Europe and Asia, anticipating a U.S. recession that could exacerbate global economic slowdowns. Commerzbank highlighted the unpredictability of Trump's administration as a key factor influencing market sentiment.

The euro gained 0.23% against the dollar to reach $1.1380 while thin trading volumes were observed due to public holidays in the U.S. and Britain. Market watchers focus on upcoming inflation reports as ballooning debt levels remain in the spotlight following credit downgrades and weak auctions in major economies.

(With inputs from agencies.)