Anndy Lian
Quick analysis of global markets and cryptocurrency trends amid steady risk sentiment
I’ve been closely monitoring the latest developments shaping markets worldwide, offering my perspective on how these events intertwine and what they mean for investors, traders, and the broader economy. From the steadying of global risk sentiment thanks to promising EU-US trade talks, to the mixed reactions in equity markets, and the fascinating dynamics in the cryptocurrency space, there’s a lot to unpack.
Let’s explore this step by step, weaving together facts, data, and analysis into a comprehensive narrative.
Trade talks set the tone for global risk sentiment
The global financial markets are currently riding a wave of cautious optimism, largely driven by positive signals from EU-US trade negotiations. On Monday, May 26, 2025, EU Trade Commissioner Maros Sefcovic shared encouraging news after a productive call with US Commerce Secretary Howard Lutnick. Sefcovic emphasised that the European Commission is “fully committed to constructive and focused efforts at pace” toward securing a trade deal with the United States.
This commitment couldn’t come at a more critical time, as fears of a transatlantic trade war have loomed large, threatening to disrupt the US$1.7 trillion annual trade relationship between these two economic giants. The mere hint of progress has steadied global risk sentiment, providing a much-needed respite from the uncertainty that has plagued markets in recent months.
Why does this matter? According to economic think tanks like Bruegel and the Tax Foundation, a trade war could shave 0.3 per cent off EU GDP and 0.7 per cent off US GDP. Tariffs would hit industries hard—think European automakers like Volkswagen or American tech giants like Apple—and ripple through global supply chains. Brussels and Washington are signaling a desire to avoid this scenario by agreeing to accelerate negotiations, and markets are responding in kind.
European shares, from Germany’s DAX to the broader Euro Stoxx 600, have climbed, reflecting investor relief. Meanwhile, with US markets closed for Memorial Day on Monday, Wall Street futures are pointing to a higher open on Tuesday, May 27, 2025, tracking Europe’s upward trajectory. It’s a classic case of markets pricing in hope, though the deadline for a deal on July 9, 2025, keeps the pressure on.
Asian markets feel the heat of tariff threats
Not all regions are basking in this optimism, however. Asian equity markets took a hit on Monday after US President Donald Trump reignited tariff threats targeting the EU and imported mobile phones. The Hang Seng Index in Hong Kong bore the brunt, dropping 1.4 per cent, outpacing declines among its regional peers.
This reaction isn’t surprising—Asia’s economies, deeply embedded in global trade networks, are hypersensitive to US policy shifts. A 25 per cent tariff on imported iPhones, for instance, could hammer companies like Foxconn, a key supplier, and disrupt the tech supply chain that powers much of the region’s growth.
Trump’s rhetoric is a familiar playbook: bold threats followed by strategic retreats. His latest social media posts have rattled nerves, promising 50 per cent tariffs on EU goods and steep levies on foreign-made phones. Yet, his decision to push EU tariff deadlines to July suggests these are bargaining chips rather than immediate policy.
Still, the uncertainty weighs heavily, and while Asian indices showed mixed performance early Tuesday, the shadow of potential trade barriers lingers. For investors, this divergence—Europe and the US rising while Asia stumbles—highlights the uneven impact of geopolitics on global markets.
US markets and the data deluge ahead
With US markets shuttered for Memorial Day, all eyes are on Tuesday’s reopening. Wall Street futures are buoyant, mirroring Europe’s gains, but the real test comes tonight with a packed US economic data slate.
We’re talking April’s preliminary durable goods orders, the March FHFA house price index, the May Conference Board consumer confidence survey, and the Dallas Fed manufacturing activity index for May. These aren’t just numbers—they’re pulse checks on the world’s largest economy.
Durable goods orders, a proxy for manufacturing health, could signal whether businesses are investing in big-ticket items like machinery, a sign of economic confidence. The consumer confidence survey, meanwhile, reflects how households—whose spending drives 70 per cent of US GDP—view their financial future.
A dip here, especially amid trade noise and rising Treasury yields (more on that in a moment), could dampen the stock rally. The housing and manufacturing data will round out the picture, offering clues about inflation pressures and industrial output. My take? If these figures beat expectations, they’ll reinforce the bullish sentiment from trade talks. But any weakness could stoke fears of a slowdown, testing the market’s newfound optimism.
Bonds, dollars, and commodities: The supporting cast
The bond market, quiet on Monday due to the holiday, is another piece of this puzzle. The 10-year US Treasury yield stood at 4.51 per cent last Friday, a level that’s been climbing amid concerns over US debt and potential fiscal stimulus like tax cuts.
Higher yields make bonds more attractive than stocks, but they also raise borrowing costs, which could cool economic growth. When trading resumes, watch how yields react to the trade news and data releases—stability could bolster stocks, while a spike might trigger a sell-off.
Currency and commodity markets are also in flux. The US Dollar Index slipped 0.2 per cent to 98.93, a modest retreat that aligns with easing trade tensions reducing its safe-haven appeal. Gold followed suit, dipping 0.4 per cent to US$3,344 per ounce, as investors dialled back on defensive assets.
Brent crude oil edged down 0.1 per cent to US$65 per barrel, caught between optimism over trade (which could lift demand) and worries about rising OPEC+ supply. These moves suggest a market in transition, shedding some risk-off posture but not fully embracing a growth narrative yet.
The crypto corner: Bitcoin’s institutional boost
Now, let’s pivot to cryptocurrencies, where the action is equally compelling. Bitcoin is teasing a breakout, hovering above US$108,000 but struggling to crack the $110,000 resistance. What’s fuelling this? Institutional appetite is roaring—Bitcoin ETFs are seeing hefty inflows, and MicroStrategy just dropped US$427 million on more BTC. This isn’t a retail frenzy; it’s big money betting on digital gold.
Add in technological leaps in Bitcoin mining—think efficiency gains boosting the network’s role in decentralised finance (DeFi)—and you’ve got a recipe for cautious optimism. Analysts see US$114,000 as the next target if upcoming data or political events (like a trade deal) tilt positive.
MicroStrategy’s moves deserve a closer look. Between May 12 and May 18, 2025, the company raised US$765.4 million through share sales—1.71 million MSTR shares and 621,555 STRK preferred shares—then plowed US$764.9 million into 7,390 BTC at US$103,498 per coin.
Their stash now stands at 576,230 BTC, bought at an average of US$69,726, totalling US$40.18 billion. That’s a bold play, especially with a class action lawsuit challenging their crypto-heavy strategy. To me, it’s a high-stakes vote of confidence in Bitcoin’s future, though the legal risk adds a wildcard.
Ethereum’s bullish bounce
Ethereum’s story is just as intriguing. Trading near US$2,576, ETH is climbing within a bullish pennant on the 4-hour chart—a pattern hinting at an imminent surge.
It’s bounced convincingly from the US$2,470–US$2,495 demand zone, backed by strong technicals and growing interest in spot and derivatives markets. Why the uptick? Renewed investor faith after a breakout from $1,920 earlier this month, plus momentum pushing it toward a key descending trendline. If bulls break through, US$2,650 and US$2,713 are in sight.
On the daily chart, ETH’s holding above the US$2,550 pivot, consolidating below US$2,600–US$2,620 resistance—a zone tied to old supply levels from March. This setup screams potential, though it hinges on sustained buying pressure.
My take: A balancing act of hope and caution
So, where do I land on all this? Global risk sentiment is indeed steady, buoyed by EU-US trade progress, but it’s a fragile equilibrium.
Europe and the US are riding a wave of relief, while Asia’s jitters remind us that Trump’s tariff threats aren’t empty noise—they’re a real risk. Tonight’s US data could either cement this optimism or expose cracks in the recovery narrative. In crypto, Bitcoin and Ethereum are flexing muscle, powered by institutional bets and technical strength, yet they’re not immune to macro shocks.
For investors, it’s a time to stay nimble. The trade talks are a lifeline, but deadlines and politics could derail them. Stocks look poised for gains if the data cooperates, though bonds and commodities signal lingering doubts.
Crypto’s resilience impresses me—MicroStrategy’s all-in approach is gutsy, and Ethereum’s chart is a technician’s dream—but volatility lurks. My advice? Embrace the upside, but keep an eye on the exits. The world’s holding its breath, and so should your portfolio.
Source: https://e27.co/quick-analysis-of-global-markets-and-cryptocurrency-trends-amid-steady-risk-sentiment-20250527/
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