06:21 AM EDT, 04/03/2025 (MT Newswires) -- Commerzbank in its "European Sunrise" note of Thursday highlighted:

Markets: United States Treasuries rally on President Donald Trump's tariff announcements, open higher in Asia with 10-year yields close to 4.05%. Global equities drop sharply, with e-minis opening lower in Asia before a modest recovery sets in. EUR rises above $1.09 amid USD weakness. Brent falls significantly to $73.3/barrel.

Tariffs: Trump announces sweeping tariffs on 57 countries as of next Wednesday and introduces 10% baseline tariff on imports into the U.S. as of this Saturday. Most nations' products face additional "discounted reciprocal tariffs" with 20% on the European Union and 24% on Japan. 34% on China will be in addition to 20% existing tariff, bringing the total to 54%. 25% tariff on international-made autos comes into effect, but the sector is excluded from reciprocal tariffs. Canada and Mexico are exempt from the reciprocal tariff regime for now.

U.S.: Treasury Secretary Scott Bessent urges other nations against retaliation as White House wants to "let things settle for a while." Separately indicates that the Treasury could run out of cash by May or June. Senate unveils plan for tax cuts and increase in borrowing limit. Trump's economic advisor Stephen Miran says that tariffs will cause "short-term bumps."

Fed: Federal Reserve Governor Adriana Kugler supports holding rates steady amid inflation risks.

==EUROPE:

EU is working on plans to shield economy from U.S. tariffs (Bloomberg sources came out ahead of Tump's announcement). European Commission President Ursula Von der Leyen says "the global economy will massively suffer" but it's "not too late" for negotiations and EU countermeasures will come if negotiations fail.

Germany: SPD's Saskia Esken sees progress in coalition talks but still a lot to do. Greens critisize alledged CDU plans to reintroduce nuclear power.

ECB: European Central Bank Governing Council (GC) member Francois Villeroy de Galhau says that U.S. tariffs shouldn't derail disinflation in Europe. He adds that slower inflation can give confidence to another rate cut "soon." GC member Robert Holzmann says that a trade war may require unconventional monetary policies.

==ASIA:

China vows retaliation against Trump's tariffs. Caixin Services PMI rises 0.5 pts to 51.9 while the consensus was 51.5.