But it is equity markets that are bearing the brunt of Trump's trade war. "Europe and China have already responded that they will retaliate and the tariffs could boost inflation in some segments of the economy," says Peter Garnry, Saxo's head of equity strategy.
Such spillover, he said, could affect manufacturers of cars, airplanes, and drinks cans in the case of aluminium, while for steel construction industries would be exposed. On a promising note, however, Garnry notes that a 30% steel tariff imposed by former president George W. Bush back in 2002 was repealed only a year later following strong retaliation from US trade partners.
Finally today, crude oil is range-bound and on the defensive after posting its first monthly decline in the past six months. "US trade tariffs may raise the cost of US shale oil production while slowing growth due to higher transportation costs," says Ole Hansen, Saxo's head of commodity strategy.