Overnight U.S. Stocks | Nasdaq has risen more than 7% this week, U.S. Treasury bonds have fallen for the fifth consecutive day

According to Zhitong Finance APP, on Friday, the market continued to focus on the progress of Trump's tariff war, with the White House indicating an open attitude towards reaching a trade agreement with China. Bank stocks performed better than expected. This week, U.S. stocks experienced significant volatility, but all three major indices recorded gains during this period. The S&P 500 index rose 5.7%, marking its best weekly performance since November. The Nasdaq rose 7.29%, and the Dow Jones increased by 4.95%.

U.S. Treasury bonds fell for the fifth consecutive day, as investors withdrew from U.S. assets, with long-term Treasury yields approaching one of the largest weekly increases since the 1980s. On Friday, the yield on the 10-year U.S. Treasury bond rose by 16 basis points to nearly 4.6%, an increase of more than half a percentage point from the previous weekend. The surge in yields is in stark contrast to the Trump administration's goal of lowering long-term rates to ease the burden on households and businesses. This stock market crash was triggered by the U.S. trade war, which is shaking global markets and could hit the economy again by broadly raising borrowing costs. This has also raised doubts about the status of U.S. Treasuries as a global safe haven.

【U.S. Stocks】 As of the close, the Dow rose 619.05 points, an increase of 1.56%, closing at 40,212.71 points; the Nasdaq rose 337.14 points, an increase of 2.06%, closing at 16,724.46 points; the S&P 500 index rose 95.31 points, an increase of 1.81%, closing at 5,363.36 points. Apple (AAPL.US) rose over 4%, and Amazon (AMZN.US) rose over 2%. The Nasdaq China Golden Dragon Index rose 1.73%, XPeng (XPEV.US) rose over 11%, and Alibaba (BABA.US) rose 3.4%.

【European Stocks】 The German DAX 30 index fell 225.21 points, a decrease of 1.09%, closing at 20,364.14 points; the UK FTSE 100 index rose 47.56 points, an increase of 0.60%, closing at 7,960.81 points; the French CAC 40 index fell 19.47 points, a decrease of 0.27%, closing at 7,106.55 points; the Euro Stoxx 50 index fell 32.27 points, a decrease of 0.67%, closing at 4,786.65 points; the Spanish IBEX 35 index fell 52.67 points, a decrease of 0.43%, closing at 12,287.53 points; the Italian FTSE MIB index fell 283.09 points, a decrease of 0.83%, closing at 33,994.00 points.

【Asia-Pacific Stock Markets】 The Nikkei 225 index fell 2.96%, the South Korean KOSPI index fell 0.5%, and the Indonesian Composite Index rose 0.13%.

【Foreign Exchange】 The ICE U.S. Dollar Index fell 0.86%, closing at 99.998 points, with a cumulative decline of 2.94% this week. From Monday to Wednesday, it fluctuated around 103 points at a "high level," and continued to decline on Thursday and Friday, dropping to 99.014 points in early European trading on Friday—marking the first time it fell below the psychological threshold of 100 points since July 13, 2023. The intraday trading range was points. The Bloomberg Dollar Index fell 0.97%, closing at 1,234.24 points, with a cumulative decline of 2.42% this week, with an overall trading range of 1,272.61-1,229.57 points [Cryptocurrency] Bitcoin rose over 5%, reported at $83,956.12; Ethereum rose over 3.2%, reported at $1,570.99.

[Metals] Gold has risen for three consecutive days, continuing to reach historical highs. Spot gold rose 1.97%, reported at $3,238.42 per ounce.

[Crude Oil] As of the close of trading that day, the price of light crude oil futures for May delivery on the New York Mercantile Exchange rose $1.43, closing at $61.50 per barrel, an increase of 2.38%; the price of Brent crude oil futures for June delivery rose $1.43, closing at $64.76 per barrel, an increase of 2.26%.

[Macroeconomic News]

U.S. Producer Prices Unexpectedly Decline in March. U.S. producer prices unexpectedly fell in March due to a significant drop in energy product costs, but import tariffs are expected to push inflation higher in the coming months. The U.S. Bureau of Labor Statistics reported on Friday that the PPI fell 0.4% month-on-month in March, with February's data revised to a 0.1% increase. The annual rate of PPI in March rose by 2.7%, compared to a 3.2% increase in February. Weak domestic demand may somewhat ease the anticipated surge in inflation. The March CPI report showed monthly declines in airline ticket prices, hotel rates, and motel room prices.

U.S. Consumer Confidence and Inflation Expectations Deteriorate Sharply. U.S. consumer confidence deteriorated sharply in April, with 12-month inflation expectations soaring to the highest level since 1981 due to escalating trade tensions. On Friday, the University of Michigan reported that the consumer confidence index fell from a final value of 57.0 in March to 50.8, while economists had predicted a drop to 54.5. Joanne Hsu, director of the Consumer Survey Center, stated, "This decline is widespread across age, income, education, geographic regions, and political affiliations, and it is consistent." "Consumers reported multiple warning signals, increasing the risk of economic recession: expectations regarding business conditions, personal financial situations, income, inflation, and the labor market all continued to deteriorate this month."

U.S. Customs: Tariff Declaration System Malfunction. According to media reports, U.S. Customs reported a malfunction in the system used to exempt freight from tariffs. The affected freight includes all trade goods from countries currently under the 90-day tariff suspension period implemented by the Trump administration. U.S. Customs stated that it found the entry codes used by U.S. shippers to apply for duty exemptions were not functioning, and "this issue is under review." For the time being, this means that the U.S. government is temporarily unable to collect tariffs. U.S. Customs indicated that it would release updates once the issue is resolved. Dewardric McNeal, a senior policy analyst at consulting firm Longview Global, stated that malfunctions do occur, but the timing is unfortunate, raising more questions about U.S. Customs' ability to keep pace with tariff adjustments.

Federal Reserve's Musalem: The Fed Should Be Cautious of Persistent Inflation Driven by Tariffs. Federal Reserve's Musalem stated that he is closely monitoring whether the rise in short-term inflation expectations will seep into long-term expectations, which could make combating inflation more difficult and reduce the Fed's flexibility in responding to a weak labor market He pointed out that there is a high degree of uncertainty regarding the effects and timing of tariffs and other new policies, and even if the job market softens, there is a "significant possibility" that inflation could accelerate again. He stated that the Federal Reserve's policy is in a favorable position and should remain vigilant. He said, "I am cautious about the assumption that 'the impact of increased tariffs on inflation is only temporary or limited.' I believe it is appropriate to 'counter' second-round effects through monetary policy, although in practice, distinguishing potential inflation from the direct, indirect, and second-round effects of tariffs can be a challenge."

New York Fed President Williams: Tariffs expected to exacerbate inflation and slow economic growth. New York Fed President Williams expects that tariffs will drive up inflation and suppress economic growth, stating that the Federal Reserve's monetary policy stance is "in the best position to manage these risks as much as we can." He noted, "During uncertain times, consumers may delay making significant decisions, such as buying a house or a car, and businesses may postpone investments until they have a better understanding of the future," adding, "When households and businesses cut back on spending, economic growth slows." With February data showing inflation still above target, Williams stated that it is correct for the Federal Reserve to maintain interest rates at a level that moderately suppresses the economy. "The current moderately tight monetary policy stance is entirely appropriate," he said. Williams also remarked, "In times of turbulence and uncertainty, good long-term inflation expectations are crucial for ensuring price stability," emphasizing that maintaining inflation expectations is vital as we pursue maximum employment and aim to restore inflation to the long-term target of 2%.

Analysts: U.S. Customs failure may be a "strategic smokescreen." Institutional analysts suggest that the recent failure at U.S. Customs may be more than just a software glitch. The so-called "failure" narrative may serve as a strategic smokescreen, not aimed at fixing a malfunctioning system, but rather buying time during a significant adjustment period of high risk in global trade and capital flows. As Trump's heavy-handed tariff measures send shockwaves through global supply chains, the sudden "failure" that halts tariff data processing conveniently allows key stakeholders—clearinghouses, freight forwarding companies, the U.S. Treasury, and Customs—to pause and reprice and reposition before any new tax rates are implemented. This could also be a form of information disruption similar to a wartime fog strategy. By freezing tariff exemption tracking and reducing transparency regarding who receives exemptions and who does not, it provides the U.S. administration and Treasury with some relatively quiet time (hours or days) to assess market reactions and intervene if necessary, without news headlines exposing their actions. It can be viewed as a proactive firewall against liquidity crises or geopolitical panic, rather than a systemic failure.

Federal Reserve Kashkari: Investors are pulling out of the U.S. Minneapolis Federal Reserve Bank President Kashkari stated on Friday that recent market trends indicate that investors are leaving the U.S., the safest investment location, amid the escalation of Trump's trade war. He noted that in recent days, as U.S. Treasury yields rise and the dollar depreciates against global currencies, the trend is contrary to what is typically observed "Under normal circumstances, when you see a significant increase in tariffs, I expect the dollar to appreciate. I think the fact that the dollar is simultaneously declining makes the argument for a shift in investor preference more credible," Kashkari said. He also stated, "Investors around the world view the U.S. as the best investment location, and if that is the case, we will see a trade deficit. Therefore, one way this is currently manifesting is through the declining yields on various U.S. assets." He added, "If the trade deficit decreases, investors might say, 'Well, the U.S. is no longer the most attractive investment destination in the world,' and then you would see bond yields rise." However, Kashkari pointed out that he sees "pressure" in the market rather than severe chaos.

U.S. Treasury yields soar as analysts say confidence in the U.S. bond market is waning. On Friday, U.S. Treasury yields surged to their highest level since February of this year. Traders complained that liquidity is deteriorating amid a worsening sell-off in the $29 trillion U.S. Treasury market. The yield on the 10-year U.S. Treasury rose by 0.19% to 4.58%. Traditionally viewed as the ultimate safe haven in the global financial system, U.S. Treasuries are sinking deeper into a slump. Earlier this week, U.S. Treasury yields were below 3.9%, but Trump's erratic tariff policies have shaken investors' confidence in U.S. policymaking and the economy, prompting a mass exodus from U.S. assets. Peter Tchir, head of macro strategy at Academy Securities, stated, "If you are a foreign holder, there is indeed pressure to sell U.S. Treasuries and corporate bonds globally." "What the world is really worried about is that they don't know what Trump is going to do." According to the Bloomberg U.S. Treasury Index returns, Friday's sell-off marked the worst week for U.S. Treasuries since 2019, accompanied by a decline in the dollar. "We are concerned because the trends you see indicate that this is not a normal sell-off," said an executive from a European bank's commodities services division. "They indicate that people have completely lost confidence in the world's strongest bond market."

【Stock News】

Volvo (VLVLY.US) CEO says it may take two years to expand production in the U.S. Volvo Cars CEO Hakan Samuelsson stated that the company will need up to two years to expand production in the U.S. Since April 2, Volvo has paid a tariff of 27.5% on imports to the U.S. He noted that selling European-made cars in the U.S. will be unsustainable, putting pressure on profit margins and leading to price increases for customers.

Stellantis (STLA.US) expects first-quarter shipments to be around 1.2 million, a 9% year-on-year decline. Stellantis Group released its forecast for first-quarter shipments on April 11, expecting approximately 1.2 million shipments globally, excluding its joint ventures, by March 31, 2025, representing a 9% year-on-year decline. This is primarily due to extended downtime in the North American market caused by the long holiday in January, as well as impacts from product transitions and declining sales of light commercial vehicles in the European market