- Asian stock markets:
- Wall St futures slip 0.2%, European futures similarly down
- Dollar up 0.3% on Canadian currency, euro off 0.2%
- Asian shares regain posture, bitcoin hits record high
SYDNEY, July 11 (Reuters) - U.S. and European stock futures dipped in Asia on Friday after President Donald Trump stepped up tariff threats against Europe and Canada, restraining a broad rally in regional share markets.
The dollar gained on the euro and the Canadian currency as Trump issued a letter late on Thursday that a 35% tariff rate on all imports from Canada would apply from August 1, adding the European Union would receive a letter by Friday.
The U.S. president, whose global wave of tariffs has upended businesses and policymaking, floated a blanket 15% or 20% tariff rate on other countries, a step up from the current 10% baseline rate.
Both Nasdaq futures and S&P 500 futures fell almost 1% before recovering most of the losses and were last down 0.2%. EUROSTOXX 50 futures were also last 0.2% lower.
The euro slipped 0.2% to $1.1676, while the dollar gained 0.3% to C$1.3695 .
Earlier in the week, Trump pushed back his tariff deadline of July 9 to August 1 for many trading partners to allow more time for negotiations, but broadened his trade war, setting new rates for a number of countries, including allies Japan and South Korea, along with a 50% tariff on copper.
Joseph Capurso, head of international economics at the Commonwealth Bank of Australia, said the tariff rate of 35% on Canada is not as bad as feared because most of the imports are still subject to exemptions under the United States-Mexico-Canada Agreement (USMCA).
"Now the tariff rate on imports from the EU... That's what we don't know as yet... The potential escalation between the EU and the US is a big deal for financial markets," said Capurso.
"If you get something similar to (the U.S.-China trade war in April), that's going to be very destabilising."
Overnight, Wall Street indexes rose modestly to post record closing highs as chip giant Nvidia made history with a closing market valuation above $4 trillion.
MSCI's broadest index of Asia-Pacific shares outside Japan wobbled but was last up 0.4% to hit the highest level since November 2021. It was driven by a 1.7% rally in Hong Kong's Hang Seng index , helped by expectations of further policy support.
Chinese blue-chips jumped 0.9% to the highest level since December last year ahead of talks between U.S. Secretary of State Marco Rubio and Chinese Foreign Minister Wang Yi at the ASEAN Summit.
Tokyo's Nikkei was flat, dragged lower by a 6.3% drop in shares of Uniqlo owner Fast Retailing after it warned of a significant tariff impact to its U.S. operations from later this year.
The yen has been steadily weakening as the prospects dim for a U.S.-Japan trade deal. The dollar was up 0.4% on Friday at 146.88 yen and is headed for a weekly gain of 1.6%, the biggest this year.
Bitcoin jumped 3.8% to $117,880, the highest on record.
With little on the data calendar in Europe and the U.S., investors are gearing up for second-quarter U.S. corporate earnings next week to gauge the impact of Trump's tariffs from April 2. JPMorgan Chase is due to release results on Tuesday, essentially kicking off the reporting period.
In Treasury markets, moves were muted in Asia. Benchmark 10-year U.S. Treasury yields rose 2 basis points to 4.3637%, having edged up a tiny bit overnight after data showed jobless claims unexpectedly fell last week.
Oil prices rose slightly after losing 2% overnight. Brent crude futures gained 0.2% to $68.77 a barrel, having lost 2.2% a day earlier.
U.S. West Texas Intermediate crude was up 0.3% at $66.75 a barrel.
Spot gold rose 0.4% to $3,337 an ounce.
Reporting by Stella Qiu in Sydney; Editing by Shri Navaratnam, Jamie Freed and Saad Sayeed
Source: Reuters