LVMH Slides on Weak US Demand, Tariff Fears Loom

LVMH reported disappointing Q1 results, highlighting signs of US consumer pullback amid recession worries. Asian markets edged up slightly after Trump hinted at possible exemptions on auto-related tariffs, boosting Japanese automakers, while European drugmakers like Novo Nordisk face potential tariff threats. The US dollar weakened further against the euro and yen, and gold climbed closer to its recent record high.

Equities

The FTSE 100 rose 2% on Monday, lifted by broad-based gains after the White House confirmed that smartphones, computers, and other consumer electronics would be temporarily excluded from new US tariffs. The FTSE 250 also gained 2.5%, with both indices rebounding from recent declines.

Banks led the charge, with Standard Chartered and Barclays each climbing 5%. Energy group Energean rose 5.3% after securing a 17-year gas sale agreement through its Israeli subsidiary with Kesem Energy. Convatec Group added 4.3% after raising full-year sales guidance for its InnovaMatrix wound treatment product to $75 million, up from $50 million. Kainos Group jumped 6.5% as it said 2025 revenues would be in line with market expectations.

Fund manager Ashmore fell 6.4% after disclosing a 5% drop in third-quarter assets under management, as large institutional clients withdrew funds near the end of the period.

In the US, the S&P 500 and Dow Jones Industrial Average each rose 0.8%, while the Nasdaq added 0.6%. The rally was led by Apple, which gained 2.2% following news that the White House’s tariff exemptions would include smartphones and computers.

Dell rose 4% and HP climbed 2.5% on the same announcement, as investors welcomed a short-term reprieve for the tech hardware sector. Goldman Sachs added 1.9% after reporting stronger-than-expected first-quarter earnings. Pfizer gained 1% after announcing it would stop developing its experimental weight-loss pill, shifting attention back to its core pharmaceutical pipeline.

Despite these gains, the broader mood remained cautious. The semiconductor index rose just 0.3%, and Nvidia slipped 0.2%, with investors bracing for new tariffs on chips expected to be announced within a week. US President Donald Trump stated on Sunday that smartphone tariffs would follow “soon.”

The S&P 500 remains down 8% for the year so far, and technical analysts noted that the index is now in a “death cross” pattern, where the 50-day moving average has fallen below the 200-day average, a sign that short-term losses could persist. Trading volumes were roughly in line with recent averages, and market breadth was positive, with advancing stocks outnumbering decliners by more than 2 to 1 on both the Nasdaq and the NYSE.

Forex & Commodities

The US dollar held steady against the euro on Monday at $1.1359, after hitting a three-year low of $1.1473 on Friday. It fell 0.39% against the Japanese yen to 142.93 and also weakened 0.18% against the Swiss franc. Sterling gained 0.88% to $1.3195, supported by calmer sentiment following the White House’s announcement of temporary tariff exemptions on smartphones and other electronics. The Australian dollar rose 0.84% to $0.6338, building on last week’s 4% gain. The offshore Chinese yuan dropped 0.35% to 7.307 per dollar, near record lows.

Gold prices climbed 0.5% to $3,226.24 per ounce, close to Monday’s record high of $3,245.42. US gold futures were also up 0.5% at $3,242.50. The metal has been supported by strong demand for defensive assets amid policy volatility in the US and uncertainty around incoming tariffs on semiconductors and pharmaceuticals. The Federal Reserve’s Raphael Bostic indicated the central bank should remain on hold until there is more clarity on the economic impact of trade measures. Fed Governor Christopher Waller also flagged potential interest rate cuts if tariffs lead to a downturn, even with inflation still high. Data from the New York Fed showed Americans’ near-term inflation expectations in March hit the highest since late 2023.

Oil prices edged higher, with Brent crude up 0.4% at $65.13 and US WTI crude gaining 0.5% to $61.81. The market responded to President Trump’s suggestion of further tariff exemptions, including potential relief for auto-related imports. Oil was also supported by a near 5% year-on-year rise in China’s March crude imports, driven by increased Iranian shipments ahead of possible US sanctions.