Eurozone PPI, ADP Non-Farm Employment Change, ISM Services PMI

EUR/USD rebounded by 0.42% on Tuesday, recovering from recent losses but failing to reclaim the 1.0400 level. The pair snapped a six-day losing streak, yet bullish momentum remains weak as the Euro remains highly sensitive to broader market sentiment and upcoming US Nonfarm Payrolls (NFP) data.

The Trump administration has softened its stance, backing away from its own tariff threats that would have effectively taxed American consumers on imported goods. While a flat 10% import tax on European goods remains a possibility, last-minute concessions for most countries—except China—have reassured investors that much of the rhetoric is posturing rather than policy.

Looking ahead, the US ADP Employment Change data will be released on Wednesday, though its historically erratic nature means it is unlikely to drive major price action.

Gold surged to a record high of $2,845 late Tuesday buoyed by a weakening US Dollar and declining US Treasury bond yields. The escalating US-China trade war has reinforced demand for the precious metal as a safe-haven asset.

Geopolitical tensions continue to drive bullion prices higher. While US President Donald Trump has postponed tariff hikes on Mexico and Canada, a 10% duty on Chinese goods has taken effect, prompting swift retaliation from Beijing.

China has responded with tariffs on key US exports, including coal, liquefied natural gas (LNG), crude oil, farm equipment, and electric trucks. Additionally, Beijing has imposed restrictions on the export of certain metals essential to the electronics industry, further stoking supply concerns.

Oil prices diverged at Tuesday’s settlement as ongoing trade tensions between the US and China weighed on sentiment, while Washington ramped up pressure on Iran’s oil exports. The latest developments saw US President Donald Trump reinstate his "maximum pressure" campaign, aiming to drive Iranian oil exports to zero, according to a US official.

Trump signed a presidential memorandum ahead of a meeting with Israeli Prime Minister Benjamin Netanyahu, directing the US Treasury to impose stringent economic sanctions and enforcement measures on Iran.

Market participants had been watching for efforts to arrange a call between Trump and Chinese President Xi Jinping. However, Trump stated Tuesday that he was in no rush to speak with Xi, dampening hopes for a swift resolution.

Ongoing US-China trade frictions could weaken global oil demand, putting further pressure on prices.

U.S. stock index futures edged lower on Tuesday , pressured by losses in the technology sector following disappointing earnings from Alphabet. The weaker-than-expected results raised fresh concerns about artificial intelligence (AI) demand and its impact on corporate profitability.

Alphabet’s Class A shares dropped in after-hours trading after the company reported underwhelming fourth-quarter revenue, with its cloud computing division—the cornerstone of its AI ambitions—missing expectations.

Market focus will now shift toward upcoming earnings reports, as investors assess corporate performance in light of AI investment trends and global economic uncertainty. Meanwhile, the ongoing trade dispute between the U.S. and China remains a key risk factor for market sentiment, with potential for further volatility in the coming sessions.