Following the delay and exemptions for the US trade tariffs, optimism has increased in global markets. While the steps taken by the US under its protectionist trade policy continue to be the focus of investors, news of countries seeking negotiations is being closely monitored. The announcement that reciprocal tariffs will not be applied to semiconductors and some technology products continues to influence market direction by boosting risk appetite.

In recent statements, US President Donald Trump indicated that they would soon announce sectoral tariffs on drugs, expressing their desire to bring drug production back to the country. Trump stated that his opinion on tariffs would not change but that he could be flexible, emphasizing that he did not want to hurt anyone. Kevin Hassett, Director of the White House National Economic Council, also touched on receiving very good deal offers in tariff negotiations, stating that it is 100% certain that the US will not go into a recession this year.

As Federal Reserve (Fed) officials’ statements are being monitored, Fed Board Member Christopher Waller explained that if businesses rapidly and fully reflect tariff costs, inflation could approach 5% in the coming months. Waller noted that he believed the risk of a recession would outweigh the risk of inflation.

TECH STOCKS POSITIVE Analysts stated that exempting some technology products from reciprocal tariffs was a significant gain for major technology companies, but uncertainty still persists. Following these developments, Apple’s shares increased by 2.2%, Alphabet’s shares by 1.3%, while Meta’s shares fell by 1.2% and Amazon’s shares by 1.5%.

PREPARATION FOR AUTO EXEMPTION Following Trump’s statement that automobile manufacturers need “a little time” to move their production to the US and that he wants to help the automobile companies, movements in the shares of companies in this sector also attracted attention. Following the statements, shares of Ford Motor rose by 4%, General Motors by 3.5%, and Stellantis by 5.6%.

FIRST CONTACT BETWEEN EU AND US European stock markets closed positively yesterday parallel to the increased risk appetite due to negotiations optimism, as the European Union (EU) and the US had their first contact for negotiations. Meeting US Trade Commissioner Howard Lutnick and US Trade Representative Jamieson Greer in the US to hold discussions on tariffs, EU Commission Vice President for Trade Maros Sefcovic emphasized that they were ready to continue ensuring a constructive and fair agreement involving a mutual zero customs duty offer for industrial goods and work on non-tariff barriers. Sefcovic stated that both sides needed to make an effort for this to succeed.

FEAR INDEX DECREASES, STOCKS RISE Following the latest developments on tariffs, the VIX Index, known as the “fear index” in the markets and reflecting the fluctuations in the S&P 500 Index, dropped by approximately 17.8% to 30.9. In the New York Stock Exchange yesterday, the Nasdaq index gained 0.64%, the S&P 500 index rose by 0.79%, and the Dow Jones index increased by 0.78%. Index futures in the US started the new day with a fresh decline.

Yesterday, the FTSE 100 index in the UK rose by 2.14%, DAX 40 in Germany by 2.85%, CAC 40 in France by 2.37%, and FTSE MIB 30 in Italy by 2.88%. Index futures in Europe started the new day with a positive trend. In Japan, the Nikkei 225 Index increased by 1.1%, Kospi in South Korea by 1%, Hang Seng in Hong Kong by 0.1%, while the Shanghai Composite Index in China fell by 0.3%.

SAFE HAVEN DEMAND CONTINUES While US 10-year bonds saw a buying-weighted trajectory yesterday, 10-year bond yields are currently balanced at 4.36% with an 11 basis point decrease. The dollar index is trading at 99.7 with a 0.2% decrease. The price of gold per ounce closed yesterday with a 0.9% decrease at $3,210 and is currently trading at $3,228 with a 0.5% increase in the new day. The barrel price of Brent oil is currently at $64.60, showing a 0.1% gain.