(Reuters) - Goldman Sachs raised its 12-month price forecast for Europe’s benchmark STOXX 600 stock index, citing the impact of U.S. President Donald Trump’s tariff plans.

The Wall Street brokerage trimmed its forecast to 570 from 580 earlier, it said in a note on Monday.

Chinese manufacturing activity grew more than expected to a four-month high in March due to a sustained rise in new orders, private Purchasing Managers Index (PMI) data showed on Tuesday. 

The Caixin manufacturing PMI grew 51.2 in March, above expectations of 50.6 and the prior month’s reading of 50.8.

A reading above 50 signals expansion, and March’s increase—its largest since November—marks the sixth consecutive month of growth.

The Caixin data comes days after the government PMI, which showed the manufacturing sector grew more than expected in March.

Stronger demand and new product launches helped boost new business inflows. Foreign demand also picked up, with companies reporting the fastest increase in export orders in nearly a year, the PMI survey stated.

"The majority of surveyed companies expressed confidence in the near-term economic outlook, although some remained cautious over a potential escalation in global trade tensions," Wang Zhe, senior economist at Caixin Insight said in a statement.

Beijing rolled out major stimulus measures in 2024, but China’s economy faces additional pressures from U.S. trade policies under President Donald Trump.

Trump has already imposed 20% additional tariffs on Chinese goods in his second term, with more broad tariffs potentially on the horizon.

"The government has made boosting consumption the top priority of its economic work this year. That means policy efforts should focus on stabilizing employment, alleviating households’ financial burdens, and increasing their disposable income," Wang Zhe added.

Last month, China launched a special action plan to stimulate domestic consumption as part of efforts to drive economic growth.

NEW YORK (Reuters) - The amount in U.S. dollars held as reserve currency globally slipped in the last quarter of 2024 while the percentage of actual dollars held as reserve ticked up, IMF data showed on Monday.

Dollar-equivalent amounts dropped also among holdings in euro, pound sterling, yuan, yen, Swiss franc and Australian and Canadian dollars, with only the latter showing a tick up in the percentage of holdings, the IMF’s Currency Composition of Official Foreign Exchange Reserves (COFER) data showed.

Reported global holdings of reserves of foreign exchange fell to $12.36 trillion at the end of 2024 from $12.75 trillion at the end of the third quarter of last year. Broken-down reserves, those which identify the single currencies, fell to $11.47 trillion from $11.84 trillion.

The value of the greenback rose 7.7% in the last quarter of 2024 against a basket of peers, lowering the dollar value of reserves kept in other currencies. The dollar index has fallen nearly 4% in the first quarter of this year.

"I don’t expect drastic changes from one COFER report to the other because, why would you? The U.S. remains the most liquid and deep market in the world," said Brad Bechtel, global head of FX at Jefferies in New York.

"The only category that has changed significantly is the allocation to gold, especially in places like China, India, Russia... but the COFER data doesn’t really pick that up."​

The share of holdings in yuan was unchanged at 2.18% and yen was little changed at 5.82% from 5.83%.

By David French

(Reuters) -The S&P 500 and the Nasdaq Composite posted on Monday their worst quarterly performances since 2022, as uncertainty around the Trump administration’s economic agenda roiled U.S. equity markets in the first quarter of 2025.

The two benchmarks also suffered heavily in March, recording their biggest monthly percentage drops since December 2022, as President Donald Trump rolled out a swathe of new tariffs which raised fears of a global trade war that would hurt economic growth and spur inflation.

For the quarter, the S&P 500 slumped 4.6%, while the Nasdaq Composite plummeted 10.5%. The Dow Jones Industrial Average was not immune to the unease, slipping 1.3% in the opening three months.

"Investors, more or less in this first quarter, threw their hands in the air, as you really cannot trade around this," said Adam Turnquist, chief technical strategist for LPL Financial (NASDAQ:LPLA).

The Magnificent Seven technology names, which drove markets higher over a bull market which stretched through 2023 and 2024, weighed heavily on U.S. equity markets as investors sold off growth names.

Tesla (NASDAQ:TSLA) was down almost 36% in the first quarter, and Nvidia (NASDAQ:NVDA) dropped nearly 20%.

"Our big lesson from the first quarter is diversification is not dead," said Michael Reynolds, vice president of investment strategy at Glenmede.

"Whether you’re looking between, or within, asset classes, if you avoided the perils of market concentration, you actually held up quite a bit better versus some of the headline indexes."

While information technology and consumer discretionary - both sectors with heavy influence from big-tech names - posted double-digit percentage declines for the quarter, a majority of the 11 S&P sectors were higher in the same period, led by energy’s 9.3% increase.

On Monday, both the S&P 500 and the Dow temporarily shook off the uncertainty around the Trump administration’s upcoming tariff plans, which are expected to be outlined in greater detail on Wednesday.

Trump said on Sunday that expected tariffs he is set to announce will include all nations. He has already imposed tariffs on aluminum, steel and autos, along with increased tariffs on goods from China.

The S&P 500 gained 30.91 points, or 0.55%, to 5,611.85 points, and the Dow Jones Industrial Average rose 417.86 points, or 1%, to 42,001.76. The Nasdaq Composite lost 23.70 points, or 0.14%, to 17,299.29. The

Financial stocks helped boost the S&P 500 on Monday. Both Discover Financial Services (NYSE:DFS) and Capital One Financial (NYSE:COF) advanced, up 7.5% and 3.3% respectively, as investors bet their merger would ultimately be approved by regulators.

The S&P 500 consumer staples index, often considered a safe haven within stock markets, was the leading sector though with its 1.6% increase. Energy also rose, tracking a jump in crude prices.

The CBOE Volatility Index, Wall Street’s so-called fear gauge, jumped to a two-week high at 22.28 points.

As a result of tariff uncertainties, Goldman Sachs raised the probability of a U.S. recession to 35% from 20%, cut its year-end target for the S&P 500 to 5,700, and forecast more interest rate cuts by the Federal Reserve.

Focus this week will also be on economic data, including ISM business activity surveys and the crucial non-farm payrolls report. Also due this week are speeches from several U.S. central bank officials, including Fed Chair Jerome Powell.

Drugmakers’ shares slid after reports the U.S. Food and Drug Administration’s top vaccine official had been forced to resign. Moderna (NASDAQ:MRNA) dropped 8.9%.

Gene therapy companies Taysha Gene Therapies and Solid Biosciences (NASDAQ:SLDB) fell 28% and 14.4%, respectively.

In deals news, Rocket Companies was down 7.4% after the mortgage lender said it agreed to a $9.4 billion acquisition of Mr. Cooper Group. The announcement, though, sent the mortgage servicer’s stock up 14.5%.

(Reuters) -Goldman Sachs forecast the U.S. Federal Reserve to deliver three quarter point interest rate cuts this year and expects heightened recession risks amid tariff uncertainty, ahead of clarity on President Donald Trump’s reciprocal tariff plan.

The Wall Street brokereage now sees consecutive cuts in July, September, and November, compared to its previous forecast of two cuts in June and December, it said in a note on Sunday.

It anticipates a 15 percentage point increase in tariff rates, a scenario previously considered a "risk-case" but now seems more probable with Trump’s upcoming reciprocal tariff announcement on Wednesday.

The brokerage says the comments from White House officials suggest there is tolerance for short-term economic weakness to achieve their policy goals.

It now sees a 12-month recession probability of 35%, compared to its previous estimate of 20%.

The Fed maintained its benchmark interest rate at 4.25-4.50% in March, with Chair Jerome Powell noting "unusually elevated" uncertainty and challenges in economic projections due to recent policy changes by the Trump administration.

The Personal Consumption Expenditures (PCE) price index, the Fed’s preferred price gauge, increased 0.3% in February after advancing by an unrevised 0.3% in January, data showed on Friday.

Goldman Sachs also lowered its fourth-quarter gross domestic product, or GDP, growth forecast to 1.0% and raised its year-end unemployment rate forecast to 4.5%.

"We continue to believe the risk from April 2 tariffs is greater than many market participants have previously assumed," it added.

By Anushree Mukherjee

(Reuters) - Gold touched an all-time high on Monday, breaching the $3,100 level, as investors turned to the safe-haven asset amid concerns that U.S. President Donald Trump’s tariff plans would stoke a global trade war and economic fallout.

Spot gold was up 0.6% to $3,103.63 an ounce, as of 0255 GMT, after hitting a record high of $3,107.26 earlier. Bullion is up over 8% in March.

The dollar index eased 0.2%, making dollar-priced gold less expensive for buyers holding other currencies.

"Markets anxiety levels have been ramping up ahead of the reciprocal U.S. tariff announcements, which is keeping gold in high demand as a defensive play," KCM Trade chief market analyst, Tim Waterer said.

"If the tariff announcements this week are not as severe as feared, then the gold price could start to backtrack as profit-taking from the highs may be triggered."

Trump is expected to announce reciprocal tariffs on April 2, while auto tariffs will commence on April 3.

Further widening the global trade war concerns, Trump said on Sunday he was "pissed off" at Russian President Vladimir Putin and will impose secondary tariffs of 25% to 50% on buyers of Russian oil if he feels Moscow is blocking his efforts to end the war in Ukraine.

Gold, traditionally seen as a hedge against political and economic uncertainty, has risen over 18% this year. Bullion’s rally has prompted multiple banks to increase their 2025 gold price forecasts.

Meanwhile, San Francisco Federal Reserve Bank President Mary Daly said inflation data published on Friday confirms her decreased confidence in her baseline expectation that two interest rate cuts this year are a "reasonable" projection.

Spot silver rose 0.4% to $34.23 an ounce, platinum was steady at $983.51 and palladium gained 0.4% to $975.70. All three metals are set for a monthly rise.

By Joe Cash and Ethan Wang

BEIJING (Reuters) -China’s manufacturing activity expanded at the fastest pace in a year in March, a factory survey showed on Monday, with new orders boosting production, giving the world’s No.2 economy some reprieve as it deals with an intensifying U.S. trade war.

The reading should reassure officials that further fiscal support launched this year is bolstering the $18 trillion economy, which is also benefiting from foreign buyers frontloading purchases in anticipation of further U.S. trade curbs.

U.S. President Donald Trump is set to announce new "reciprocal" tariffs on Wednesday to tackle perceived trade imbalances, potentially adding more levies on Chinese goods.

Trump has already imposed a cumulative 20% tariff on all Chinese imports since returning to the White House in January, accusing Beijing of not doing enough to curb the flow of chemicals used to make the deadly drug fentanyl into the U.S.

The official purchasing managers’ index (PMI) rose to 50.5 in March from 50.2 a month prior, the highest reading since March 2024 and matching analysts’ forecasts in a Reuters poll.

The non-manufacturing PMI, which includes services and construction, accelerated to 50.8 from 50.4.

"The official PMIs suggest that infrastructure spending is ramping up again and that exports have so far remained resilient in the face of U.S. tariffs," said Julian Evans-Pritchard, head of China economics at Capital Economics.

"But the surveys are still consistent with slower GDP growth in Q1 amid weakness in the service sector," he added.

China has kept its economic target for this year unchanged at "around 5%" despite Trump’s tariff threats, which could call time on a largely export-led recovery underway since the end of the COVID-19 pandemic in late 2022.

The government has pledged more fiscal stimulus, increased debt issuance, further monetary easing and put even greater emphasis on boosting domestic demand to cushion the impact of the trade war.

China’s economy has had a bumpy start this year, with nascent improvement in retail sales offset by persistent deflationary pressures and rising unemployment.

Trying to assuage concerns among foreign enterprises over China’s economy amid Trump’s tariff threats, Chinese President Xi Jinping gathered a group of multinational CEOs last week and urged them to protect global industry and supply chains.

At a key business forum earlier this month in Beijing, Chinese Premier Li Qiang urged countries to open their markets to combat "rising instability and uncertainty."

Beijing is also doubling down on its "cash for clunkers" consumer goods trade-in programme to encourage households to open up their wallets.

Analysts polled by Reuters forecast the private sector Caixin PMI to have risen to 51.1. The data will be released on April 1.

By Ben Ezeamalu

LONDON (Reuters) - UK job vacancies saw the fastest month-on-month growth in three years in February, according to data published on Monday that contrasted with a largely gloomy outlook for the economy.

Job search company Adzuna said the 3.7% increase from January was led by its graduate and healthcare and nursing categories and followed months of slow or no growth in postings.

Vacancies remained down compared with February 2024 but the 0.8% annual drop was the smallest since July 2022.

Andrew Hunter, Adzuna’s co-founder, said February’s monthly increase was surprising given lower-than-expected economic growth and persistent inflation pressures.

Other surveys have painted a weaker picture of the labour market. The Recruitment and Employment Confederation said its figures showed a fall in demand for staff in February.

Last week, the government’s budget watchdog halved its forecast for economic growth in Britain this year to 1%.

Hunter said advertised salaries had outpaced inflation for 10 months in a row and they rose by more than 7% in annual terms in February for a third straight month.
 

By Ben Ezeamalu

LONDON (Reuters) - UK job vacancies saw the fastest month-on-month growth in three years in February, according to data published on Monday that contrasted with a largely gloomy outlook for the economy.

Job search company Adzuna said the 3.7% increase from January was led by its graduate and healthcare and nursing categories and followed months of slow or no growth in postings.

Vacancies remained down compared with February 2024 but the 0.8% annual drop was the smallest since July 2022.

Andrew Hunter, Adzuna’s co-founder, said February’s monthly increase was surprising given lower-than-expected economic growth and persistent inflation pressures.

Other surveys have painted a weaker picture of the labour market. The Recruitment and Employment Confederation said its figures showed a fall in demand for staff in February.

Last week, the government’s budget watchdog halved its forecast for economic growth in Britain this year to 1%.

Hunter said advertised salaries had outpaced inflation for 10 months in a row and they rose by more than 7% in annual terms in February for a third straight month.

"It’ll be interesting to see if this growth continues in March as we get closer to the introduction of new employer costs," he said.

In her first full budget last October, finance minister Rachel Reeves announced an increase in employers’ social security contributions which is due to start in April alongside a nearly 7% increase in Britain’s minimum wage.

Goldman Sachs said on Sunday that it expects a greater chance of a U.S. recession in the next 12 months, citing uncertainty over trade policy, softening consumer and business confidence and a lower growth baseline.

The investment bank also forecast higher 2025 inflation due to increased trade tariffs, flagging concerns over President Donald Trump’s plans for more aggressive reciprocal tariffs. 

Goldman Sachs now sees a 35% chance of a recession in the next 12 months, compared to prior expectations of 20%. 

“The upgrade from our previous 20% estimate reflects our lower growth baseline, the sharp recent deterioration in household and business confidence, and statements from the White House officials indicating greater willingness to tolerate near-term economic weakness in pursuit of their policies,” Goldman Sachs analysts wrote in a note. 

The investment bank hiked its U.S. tariff assumptions for the second time in a month, forecasting a U.S. tariff rate of 15% in 2025. 

Higher tariffs are expected to boost inflation, with Goldman Sachs forecasting core PCE inflation of 3.5% by end-2025, up substantially from current levels and well above the Federal Reserve’s 2% annual target. 

The investment bank also forecast 2025 gross domestic product growth of 1% in 2025, down from prior forecasts of 1.5%.

Goldman Sachs’ forecast comes amid growing concerns over a growth slowdown, amid pressure from Trump’s tariff policies and from stickier inflation. 

Trump is expected to announce a host of new tariffs on April 2, a date he has constantly touted as liberation day. Trump is expected to outline reciprocal tariffs against major U.S. trading partners, with recent reports showing that he could impose as much as 20% tariffs across the board.

DUBLIN (Reuters) - Irish consumer sentiment dropped to its lowest level in nine months in March as the prospect of U.S. tariffs on the European Union made consumers more nervous about the outlook for the economy and their own finances, a survey showed on Friday.

The Credit Union Consumer Sentiment index fell to 67.5 from 74.8 in February, the largest monthly pullback in two-and-a-half years and well below its long-term average of 84.2.

Research co-authored by the Irish finance ministry this week found that Ireland faces a disproportionate hit from tit-for-tariffs.

Irish League of Credit Unions CEO David Malone said it was not surprising that the sentiment survey painted a picture of a much more nervous Irish consumer.