Europe opens lower as sentiment remains fragile

Yesterday’s CPI print had the potential to weaken the dollar significantly, but it found support and held its ground. Traders now wait and watch as the greenback attempts to recover from its recent slide. Sentiment remains cautious, but the dollar appears to be holding the line for now.

Gold, however, seems to sense vulnerability and is eyeing a potential new record high. The metal’s bullish momentum reflects growing risk aversion and uncertainty in global markets. In contrast, silver traded lower on the day, struggling to match gold’s strength.

Oil remained flat, with the previous day’s lower-than-expected increase in the weekly inventory report providing some much-needed support. Despite ongoing supply concerns, crude prices held steady, keeping the bears at bay for now.

Gas moved higher after taking a hit yesterday, supported by changing outlooks on weather patterns. Meanwhile, crypto markets remained flat as both Bitcoin and Ethereum struggled to find clear direction. Like oil and the dollar, crypto seems to be holding off the bears for the moment.

The VIX remained just south of 24, signalling that volatility is still a central theme as markets continue to digest yesterday’s CPI print. While the inflation data came in slightly lower than expected, it was quickly sold into, leaving investors questioning whether it provided genuine relief or was just a temporary blip.

Today’s economic calendar features jobless claims and PPIwholesaleinflation data, which could further shape expectations ahead of next week’s pivotal Federal Reserve meeting. Traders are also weighing mixed signals from the German political landscape, as the ECB warned that US tariffs could potentially push Germany into recession this year.

Intel surged 10% in after-hours trade after announcing a new CEO, while Adobe slid lower on weaker earnings. The ongoing tariff spat between the US and Canada continues, with both sides digging in and threatening retaliatory measures. Analysts have noted that recent market weakness doesn’t necessarily indicate a full-scale sell-off but rather a rotation out of the US and into other markets.

Meanwhile, business leaders are sounding alarms over tariff conflicts and the potential for escalation. At the same time, the back-and-forth nature of the CPI print has left many questioning the broader economic outlook.

Tariff uncertainties, economic data, and Trump’s unpredictable rhetoric continue to keep markets on edge. While yesterday’s CPI print initially sparked some hope, it was quickly sold into before bouncing back, reflecting the choppy and volatile conditions that have become the norm.

The dollar may have found a temporary footing, while oil and crypto are also holding steady for now. However, the broader outlook remains uncertain, with market sentiment fragile and susceptible to sudden shifts. With the Fed meeting on the horizon and ongoing tariff disputes adding pressure, traders should remain vigilant and prepared for sudden moves as conditions continue to evolve.