stocks, news, EU inflation data watched

European stock markets opened higher Tuesday, with the Stoxx 600 index up 1% at 8:08 a.m. U.K. time.

The U.K.’s FTSE 100 and Germany’s DAX were both around 1% higher, while France’s CAC 40 rose 0.8%.

U.S. President Donald Trump is counting on a longer-term rebound in the economy and markets with his extreme tariff plan, but he is playing a “dangerous game,” according to one strategist.

“The market will take some time to digest what’s happening tomorrow, I don’t think we will see a big relief in the sense that Trump will come out and provide sweets to the market, saying tariffs will be less severe than what’s suspected,” Wolf von Rotberg, equity strategist at Safra Sarasin Sustainable Asset Management, told CNBC’s “Squawk Box Europe” on Tuesday.

“I would think that through the year he’ll likely keep the temperature quite high,” von Rotberg said, adding that this is because of Trump’s experience as president in 2018 to 2019 when the Federal Reserve was in a similar stage of a cycle of rate hikes and cuts.

“Back then he broke the back of the cycle, he broke the back of the equity market, but he also brought the Fed to turn much move dovish and he had a much better year in 2019. The cycle recovered, growth picked up, was great in the third quarter of 2019, consumption came back and the equity market had rebounded by April … Trump is not thinking about the immediate impact but one step further,” von Rotberg told CNBC.

“He won’t provide a put to the market, the only put which can be provided to the market is the Fed, and in order to get the Fed to ease and turn more dovish from where they are he needs to produce some downside on the cycle and he may have to produce some downside on the market as well.”

Wolf von Rotberg added that this was a “dangerous game,” since inflation remains well above target and could be pushed higher by inflation, curbing any Fed pivot — and because the U.S. government deficit has widened and would likely increase during a downturn, fueling fears in the rates market.

— Jenni Reid

European markets are expected to open higher Tuesday as global markets prepare for U.S. President Donald Trump’s previously announced trade tariffs to come into force.

The U.K.’s FTSE 100 index is expected to open 31 points higher at 8,689, Germany’s DAX up 88 points at 22,251, France’s CAC 8 points higher at 7,798 and Italy’s FTSE MIB 77 points higher at 38,816, according to data from IG. 

Data releases include the latest EU inflation print.

— Holly Ellyatt

Spot gold hit a fresh record high of $3,132.17 at 9.15 a.m. Singapore time on Tuesday, after crossing the $3,100 threshold on Monday.

The price of the precious metal has been on the rise as investors flock to the safe haven asset amid concerns around U.S. President Donald Trump’s fresh tariffs.

— Amala Balakrishner