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

Ankur Banerjee

The prospect of narrower-than-feared U.S. tariffs rekindled

some investor optimism in recent days but the relief rally in

stocks is already showing signs of petering out, worn down by

the unrelenting uncertainty over what comes next.

Asian stocks took their cues from Wall Street and rose

during the early Asia trading hours on signs that there may be

negotiations under way to head off or narrow the scope of

reciprocal tariffs due to be announced on April 2.

But by afternoon Asian stocks were wavering, while U.S. and

European stock futures pointed lower.

The markets' gyrations underscore investor skittishness over

U.S. tariffs and the damage they could inflict on the global

economy as well as on corporate profits.

U.S. President Donald Trump indicated on Monday that not

all of his threatened levies would be imposed on April 2 and

that some countries may get a break. He also warned that

automobile tariffs are coming soon and slapped 25% secondary

tariffs on any country that buys oil or gas from Venezuela.

And those were just the tariff headlines from Monday!

With the economic calendar during European hours rather

sparse, global trade conflicts will remain in the spotlight even

if market reactions for now will likely be muted.

Among currencies, the focus during Asian hours was on the

Indonesian rupiah, which sank to its lowest level since

the Asian financial crisis of the late 1990s on the dollar's

overall strength and worries over the fiscal health of Southeast

Asia's largest economy.

Investor confidence has been waning in Indonesia, where the

stock market last week felt the brunt of investor angst

over Indonesian President Prabowo Subianto's massive social

spending plans.

The dollar was near a three-week high against the yen

and the euro after upbeat U.S. services data

eased some concerns about where the economy is headed.

Overshadowing everything in the markets, however, is what's

happening with tariffs - implemented, proposed and on the way -

and whether they may undermine economic growth in the United

States.

Key developments that could influence markets on Tuesday:

Economic events: Germany business climate survey for

March from the Ifo institute