TL;DR

Germany eyes Russian asset seizure; Trump to set tariffs for 150 countries; Russia oil revenue drops.

Highlights

• Germany signals readiness to confiscate €210B in frozen Russian assets if legally possible; further Russia sanctions considered1.
• Trump announces new US trade deals with UK and China; plans to set tariff rates for 150 countries by July2.
• Germany backs raising NATO defense spending to 5% of GDP; formal agreement expected at June summit4.
• US Treasury warns Hong Kong banks over Iran oil shipments to China; sanctions imposed on nine Hong Kong entities3.
• Russia’s April oil export revenues fall to $13.2B, below G7 price cap; wider budget deficit forecast5.
• Bank of Mexico cuts rates by 50bps to 8.50% amid weak growth; peso weakens, BMV gains6.
• China to surpass US in nuclear power by 2030 with $27.7B investment; Belgium repeals nuclear phase-out law78.
• US labels Vietnam’s trade deficit unsustainable; pressures Southeast Asia to curb rerouting of Chinese goods17.
• Japan’s Q1 GDP contracts 0.2% QoQ; further pressure expected from upcoming US tariffs18.
• BYD to invest €248M in Budapest HQ and R&D center, expanding EU presence amid rising EV tariffs12.
• Novo Nordisk CEO to step down after profit warning; shares drop 6%19.
• DOJ to proceed with most charges against Tornado Cash co-founder; trial set for July 202520.

Commentary

Geopolitical and trade risks are front and center. Germany’s consideration of confiscating Russian assets, if legally justified, marks a potential escalation in Western financial measures against Moscow1. While this could provide resources for Ukraine, it raises concerns about precedent and the stability of the European financial system, particularly for holders of foreign reserves. Additional sanctions targeting Russia’s energy and banking sectors remain under discussion, which could further impact commodity flows and European markets1.

Trade policy uncertainty is increasing. Trump’s announcement of new deals with the UK and China is overshadowed by plans to set new US tariff rates for 150 countries, a move that could disrupt global supply chains and trade flows2. The US is also pressuring Vietnam and other Southeast Asian countries to prevent rerouting of Chinese goods, as producers seek to circumvent steep US tariffs17. Export-driven economies, especially in Asia, face mounting headwinds, as highlighted by Japan’s Q1 GDP contraction and the prospect of further pressure from US tariffs18.

Energy markets are seeing both structural shifts and near-term disruptions. Russia’s oil export revenues have dropped below the G7 price cap, widening its projected budget deficit and raising fiscal concerns5. In contrast, China is accelerating its nuclear buildout and renewables push, aiming to surpass the US in nuclear power generation by 20307. Belgium’s reversal of its nuclear phase-out law also signals a renewed focus on energy security in Europe8. Meanwhile, BYD’s investment in Hungary reflects Chinese EV makers’ pivot to local EU production amid rising tariffs12.

Central bank divergence and sector-specific risks persist. The Bank of Mexico’s rate cut underscores the challenges faced by emerging markets balancing growth and currency stability6. Novo Nordisk’s leadership change following a profit warning has weighed on healthcare equities19. In crypto, the DOJ’s decision to proceed with charges against Tornado Cash’s co-founder keeps regulatory scrutiny elevated for privacy-focused protocols20.

Traders should monitor developments on Russian asset confiscation, US tariff announcements, and NATO’s defense spending agreement, as these will likely drive cross-asset volatility in the near term.