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Trump plans tariffs on autos, pharma, chips

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Global shares edge up

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Dollar steady ahead of Fed meeting minutes

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Pound up after hotter UK inflation data

By Amanda Cooper

LONDON, Feb 19 (Reuters) - Global stocks held steady

around record highs on Wednesday, as traders cautiously shrugged

off U.S President Donald Trump's latest tariff threats on auto,

semiconductor and pharmaceutical imports.

Since Trump's inauguration four weeks ago, he has imposed a

10% tariff on all imports from China, on top of existing levies.

He has also announced, and delayed for a month, 25% tariffs on

goods from Mexico and non-energy imports from Canada.

Trump told reporters on Tuesday that sector-wide tariffs on

pharmaceuticals and semiconductor chips would start at "25% or

higher", rising substantially over the course of a year. He

intends to impose similar tariffs on autos as soon as April 2.

Stocks in Europe held roughly steady, as gains in drugmakers

and miners helped offset a broad-based decline in UK equities

after data showed a pickup in British inflation. The STOXX 600

was unchanged on the day, while the FTSE 100

fell 0.1%.

But the market reaction to Trump's threats was mostly muted

as investors increasingly see them as smaller-scale bargaining

tools.

"The global economy and global financial markets are not all

about tariffs. They're also mainly about activity, corporate

profitability and interest rates, and it's true that tariffs

might impact those three elements, but it's mainly in a

contained way, based on what we've seen so far," Lombard Odier

economist Samy Chaar said.

"(Trump) should be taken seriously - in the end, tariffs

will be higher ... however, you also have to do your work when

it comes to assessing and evaluating the impact of these

tariffs," he said.

Minutes from the U.S. Fed's January meeting, when the

central bank held borrowing costs at 4.25% to 4.5%, are due

later on Wednesday. That follows hawkish comments from Fed Chair

Jerome Powell in testimony to Congress last week and hot

consumer price data.

The dollar held steady around two-month lows against a

basket of currencies, supported by a degree of unease

over talks this week between the United States and Russia over a

possible ceasefire that have excluded both Ukraine and European

nations.

European leaders vowed to step up support for Ukraine as the

U.S. and Russia held bilateral talks on the war this week.

Investors also hope this weekend's German election will lead to

economic stimulus.

The expectation for an increase in defence spending has

propelled shares in European arms manufacturers to record highs

this week, and pushed up governments' long-term borrowing costs.

German 30-year bond yields have risen by around 20 basis

points in the last two weeks, while those on 30-year

U.S. Treasuries have risen by around 17 bps.

Overnight, the U.S. benchmark S&P 500 squeaked past

its previous record closing high. Futures on the S&P 500 and the

Nasdaq were up 0.15%.

In Asia, investors took profit on some of the recent rally

in Chinese tech stocks, which have been on a tear

recently since the emergence of AI startup DeepSeek.

"Green shoots are emerging in China's economy and DeepSeek

is injecting a shot of adrenaline into the sector," said Thomas

Rupf, co-head Singapore and CIO Asia at VP Bank.

Hong Kong's Hang Seng Index fell 0.4%, but is still

up 14% so far in 2025, jostling with Germany's DAX index

for the title of the best-performing market in the

world.

In currencies, the New Zealand dollar was 0.3%

higher at $0.5722 after the central bank cut interest rates by

50 basis points to 3.75% as expected but hinted its aggressive

cuts were set to slow.

Sterling got a small lift from data that showed a

pickup in UK inflation in January, to trade at $1.261.

Gold shrugged off the stronger dollar and rose 0.3%

to $2,944 an ounce, holding near last weeks' record highs.

(Additional reporting by Ankur Banerjee in Singapore; Editing

by Tomasz Janowski)