Stock markets in Europe and the US shrugged off the impact of new tariffs and appeared to focus on better economic data. Other markets registered concerns. The US dollar weakened, and bond yields fell as traders further factored the potential drag effects of a trade war. Asia Pacific share futures markets are pointing to modest opening gains.

Stronger German industrial production, Italian retail sales and US non-farm payrolls may have fired investor risk appetites. The gains came despite further pressure on industrial metals. The weakness in metals seemed to echo the cautions expressed by bond traders, as US ten year benchmark issues traded close to their lowest yields in more than three months. Oil rallied again as traders leant towards a bellicose White House pushing hard on sanctions on Iran.

After a benign market reaction to trade sanctions on Friday night local traders could look to Shanghai for leads today. While global indices softened into Friday’s tariff introduction, the Shanghai composite shed more than 12%, leading the trade concerns. A bounce today may fire enthusiasm, while further pressure could see the region ignore the lift in international shares on Friday night.