GLOBAL MARKETS-Stocks hold near record highs, shrugging off Trump's latest tariffs

By Amanda Cooper

LONDON, Feb 19 (Reuters) - Global stocks held steady around record highs on Wednesday, as traders cautiously shrugged off U.S President Donald Trump's latest tariff threats on auto, semiconductor and pharmaceutical imports.

Since Trump's inauguration four weeks ago, he has imposed a 10% tariff on all imports from China, on top of existing levies. He has also announced, and delayed for a month, 25% tariffs on goods from Mexico and non-energy imports from Canada.

Trump told reporters on Tuesday that sector-wide tariffs on pharmaceuticals and semiconductor chips would start at "25% or higher", rising substantially over the course of a year. He intends to impose similar tariffs on autos as soon as April 2.

Stocks in Europe held roughly steady, as gains in drugmakers and miners helped offset a broad-based decline in UK equities after data showed a pickup in British inflation. The STOXX 600 .STOXX was unchanged on the day, while the FTSE 100 .FTSE fell 0.1%.

But the market reaction to Trump's threats was mostly muted as investors increasingly see them as smaller-scale bargaining tools.

"The global economy and global financial markets are not all about tariffs. They're also mainly about activity, corporate profitability and interest rates, and it's true that tariffs might impact those three elements, but it's mainly in a contained way, based on what we've seen so far," Lombard Odier economist Samy Chaar said.

"(Trump) should be taken seriously - in the end, tariffs will be higher ... however, you also have to do your work when it comes to assessing and evaluating the impact of these tariffs," he said.

Minutes from the U.S. Fed's January meeting, when the central bank held borrowing costs at 4.25% to 4.5%, are due later on Wednesday. That follows hawkish comments from Fed Chair Jerome Powell in testimony to Congress last week and hot consumer price data.

The dollar held steady around two-month lows against a basket of currencies =USD, supported by a degree of unease over talks this week between the United States and Russia over a possible ceasefire that have excluded both Ukraine and European nations.

European leaders vowed to step up support for Ukraine as the U.S. and Russia held bilateral talks on the war this week. Investors also hope this weekend's German election will lead to economic stimulus.

The expectation for an increase in defence spending has propelled shares in European arms manufacturers to record highs this week, and pushed up governments' long-term borrowing costs.

German 30-year bond yields have risen by around 20 basis points DE30YT=RR in the last two weeks, while those on 30-year U.S. Treasuries have risen by around 17 bps US30YT=RR.

Overnight, the U.S. benchmark S&P 500 <.SPX > squeaked past its previous record closing high. Futures on the S&P 500 and the Nasdaq ESc1, NQc1 were up 0.15%.

In Asia, investors took profit on some of the recent rally in Chinese tech stocks .HSTECH, which have been on a tear recently since the emergence of AI startup DeepSeek.

"Green shoots are emerging in China’s economy and DeepSeek is injecting a shot of adrenaline into the sector," said Thomas Rupf, co-head Singapore and CIO Asia at VP Bank.

Hong Kong's Hang Seng Index .HSI fell 0.4%, but is still up 14% so far in 2025, jostling with Germany's DAX index .GDAXI for the title of the best-performing market in the world. .HK

In currencies, the New Zealand dollar NZD=D3 was 0.3% higher at $0.5722 after the central bank cut interest rates by 50 basis points to 3.75% as expected but hinted its aggressive cuts were set to slow.

Sterling GBP=D3 got a small lift from data that showed a pickup in UK inflation in January, to trade at $1.261.

Gold XAU= shrugged off the stronger dollar and rose 0.3% to $2,944 an ounce, holding near last weeks' record highs. GOL/