A look at the day ahead in European and global markets from

Ankur Banerjee

Today is the deadline for U.S. trading partners to submit

their "best offer" to avoid punishing import tax rates, the same

day that U.S. duties on imported steel and aluminium kick in,

and investors are more jittery than usual.

So far, only Britain has struck a preliminary trade

agreement with the U.S. during Trump's 90-day pause on a wider

array of tariffs. That pause is set to expire in about five

weeks and investors have been worried about the lack of progress

in hashing out deals.

Adding to the angst, Japanese Chief Cabinet Secretary

Yoshimasa Hayashi said Tokyo has not received a letter from

Washington asking for its best proposals on trade talks.

The on-again-off-again tariff pronouncements from Trump this

year have investors fleeing U.S. assets and looking for safe

havens and alternatives, including gold. They expect trade

uncertainties will take a heavy toll on the global economy.

The main question in financial markets has been where the

money that usually flowed into U.S. assets will end up going.

For years, money managers embraced the fatalistic presumption

that "there-is-no-alternative" (TINA ... yes, markets love

acronyms) but perhaps there are options now.

As Manishi Raychaudhuri, the founder and CEO of Emmer

Capital Partners Ltd, puts it: While Europe may be the obvious

destination, relative value metrics may favour emerging Asia.

The data so far does not give a complete picture. But what

it does show is investors are lowering their exposure to U.S.

assets, and only time will tell where they end up.

Asian markets rose on Wednesday, boosted by tech stocks as

traders hope a deal could still be possible if and when U.S.

President Donald Trump and Chinese leader Xi Jinping talk this

week.

The spotlight in Asia was also on South Korean assets.

Seoul's benchmark share index surged to 10-month top and

the currency firmed as liberal presidential candidate

Lee Jae-myung's election victory raised expectations for swift

economic stimulus and market reforms.

European futures point to a slightly higher open ahead of a

series of manufacturing data from the region and as the European

Central Bank starts its policy meeting.

The ECB is all but certain to cut rates on Thursday and stay

on its easing cycle as muted wage growth, a strong euro and

lukewarm economic growth all point to easing inflation. Data on

Tuesday showed euro zone inflation in May eased below the ECB

target of 2%.

Key developments that could influence markets on Wednesday:

Economic events: May PMI data for UK, euro zone, Germany and

France

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