The U.S. stock market diverges sharply from European markets as recession concerns escalate. Recent credit volatility surged last week, fueled by apprehensions surrounding U.S. growth influenced by the ongoing trade tensions initiated during the Trump administration. As the cross-asset volatility spreads, equity, rates, and FX implied volatilities trade at levels 0.5 to 1 standard deviation above their 10-year averages. Interestingly, credit volatility remains below its historical norms, hinting at a complex landscape for investors. This divergence underlines a critical focus area for market watchers, as uncertainties in trade and their implications for economic performance weigh heavily on investor sentiment.