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Asian Stock Markets Surge
After a rough start to the week, the majority of major Asian stock markets managed to recover and even ended the day significantly higher. The Jakarta Composite Index (+4.1%), the Nikkei 225 (+1.8%), and the TOPIX (+1.77%) all showed notable gains.
This rally followed the announcement that China's official Caixin Manufacturing Purchasing Manager Index (PMI) for February 2025 had returned to the expansion zone. A key factor in this improvement was a substantial rise in the new orders index, which increased from 49.2 to 51.1. Additionally, the production index rebounded from 49.8 to 52.5, marking the highest level in 10 months for both sub-indices.
Nickel and Stainless Steel Scrap Prices Climb
In China, the price of stainless steel scrap surged significantly on Monday. Prices for grades 201, 316L, and 304 rose by as much as 1.7%. Nickel contracts on the Shanghai Futures Exchange (SHFE) remained stable, while prices on the London Metal Exchange (LME) saw an increase of around 1.4%.
Comment: The European Union Must Finally Step Up
The time for passive responses is over. It is crucial to address the current political climate, especially in the context of the ongoing scandal between U.S. President Donald Trump and Ukrainian President Volodymyr Zelenskyy. This media spectacle, though significant, should not distract from equally pressing issues closer to home.
Europe’s Inaction on the Trade Dispute
A prosperous economy is essential for solving a nation's problems. Without economic growth, there is less available funding to address challenges. With trade barriers looming, including proposed punitive tariffs on a range of European products, the EU’s dependence on exports to the U.S. is becoming a financial burden rather than a source of opportunity.
Canada and Mexico Making Progress on Trade Solutions
While Europe flounders, the U.S. is making progress with Canada and Mexico in resolving trade disputes. U.S. Commerce Secretary Howard Lutnick’s comment on the forthcoming tariffs on Mexico and Canada barely registered in European media, overshadowed by alarmist stories about diplomatic conflict.
Lack of Action on the EU’s Trade Crisis
It is surprising how quickly European states can organize emergency summits on defense, yet remain passive when it comes to trade. There is no equivalent effort to address the threat of U.S. tariffs. The EU's focus appears to be on posturing rather than formulating practical solutions.
European Delegation's Failure in Washington
The EU's trade commissioner was recently sent to Washington, but the trip yielded little progress. Björn Seibert, a close ally of Ursula von der Leyen, was unable to secure any agreements. It is puzzling why the EU’s top representative has not yet visited Washington in person. Is Europe not committed to reaching an agreement?
Germany Must Take the Lead
Germany, as Europe’s largest trading partner with the U.S., needs to act swiftly. The incoming German Chancellor, Friedrich Merz of the CDU, must travel to Washington without delay to negotiate a deal. The specifics of the journey, including whether he uses Germany's Air Force One, are irrelevant. What matters is that Merz steps up to defend Europe’s interests. If new special funds totaling 900 billion euros for infrastructure and defense are being discussed, Merz should demonstrate the same urgency in addressing this critical trade issue.
