Looking ahead to the European and global markets, investors in Europe are waking up to futures pointing towards a more than 3% increase after a recent sharp drop of nearly 12% in their stock benchmark over three days.

Despite President Donald Trump's firm stance on addressing trade imbalances, particularly with China, by threatening additional 50% tariffs, the markets remain volatile. Wall Street closed flat after a significant decline in the previous sessions.

Monday's trading saw high volatility, with the VIX fear gauge reaching above 60 for only the second time since the pandemic began. There are doubts about whether the market rebound will be sustained, as a 3% increase in the STOXX 600 would not fully recover from the losses following Trump's tariff announcement.

Japan stands out with a strong stock market rally amidst trade talks led by Treasury Secretary Scott Bessent, hinting that Trump's tariffs may just be the beginning of negotiations. Market performance varies across Asia, with Japan's gains contrasting with Taiwan's 5% sell-off due to heavy reliance on chip exports and facing high levies.

Asian emerging markets, hit hard by steep tariff rates, continue to face stock market declines. Thailand and Indonesia experienced significant drops in their markets and currency values.

Key events influencing markets on Tuesday include speeches by ECB officials, the German Finance Minister, and central bank governors from Sweden and Norway, among others.

For the latest tariff updates impacting global trade, a new daily news digest, Tariff Watch, provides a summary of top market-moving headlines.