The US-China trade war is the central theme in the market. China is not honouring the agreement and is not exporting rare earths, which has angered the Trump administration.
However, it was the US that started the tariff war in the first place, and even if China says it will not implement the reconciliation plan, then the US should not have raised tariffs in the first place.
It was clear from the start that China would move to ban rare earth exports. Going forward, headlines surrounding the U.S.-China trade war remain the biggest risk. Since there has been no response from China, they may be considering significant countermeasures against the U.S.

The ADP employment statistics and ISM non-manufacturing business conditions index continued to show very weak figures, resulting in the dollar-yen exchange rate falling to around 142.60 yen. However, the previous day’s JOLTS job openings were unexpectedly strong. Market participants were likely waiting for the U.S. employment statistics to clarify the direction.
Unemployment insurance claims are also a key point, but they are a minor indicator compared to the employment statistics.

While the JOLTS job openings data showed a surprising rebound, both the ISM Manufacturing and Non-Manufacturing indices fell short of market expectations, and the negative impact of tariffs was evident. If that is the case, even if the U.S. employment data is strong, the U.S. economy will eventually weaken.
The non-farm payrolls data is always mysteriously strong when first released, only to be revised downward later. Given this recurring pattern, the reliability of these figures is questioned, and there is a possibility that strong numbers may emerge today as well.

The ECB’s rate cut was already fully priced in. This is not a situation where monetary policy will have a significant impact. While market attention has shifted slightly, there is concern that Russia’s retaliation against Ukraine could escalate to a large scale, so caution is warranted.