Wall St advances on trade hopes amid investor pessimism
Wall Street's main indexes rose on Friday for their fifth straight day, buoyed by the US-China tariff truce earlier in the week even as economic survey data showed a deterioration in consumer sentiment.
The S&P 500 steadily added to gains from late morning, while investors took weak data in their stride. The University of Michigan Surveys of Consumers said its Consumer Sentiment Index slumped further in May while one-year inflation expectations surged to 7.3 per cent from 6.5 per cent in April.
All three main indexes boasted weekly gains after starting out with a steep rally on Monday - after Washington and Beijing agreed to a 90-day pause in their escalating trade war. This was days after the US President and British Prime Minister announced a limited bilateral trade agreement.
Lindsey Bell, chief market strategist at Clearnomics, New York, said Friday's advance was a "carry on from the de-escalation in the trade conflict."
With a solid economy combined with pessimistic investors, Bell expects more volatility ahead as tariff headlines come out, and added that "data could change in coming months."
"I don't think we're out of the woods yet. We're going to have to take it on a day-by-day, week-by-week basis," she said.
Paul Christopher, head of global investment strategy at Wells Fargo Investment Institute, said the market is "cautiously optimistic" about the softening stance on trade, but waiting to see where the US eventually lands on tariffs.
"We haven't even begun to see what happens when those tariffs really bite, when firms have to raise their prices to consumers and consumers see fewer goods and less variety on the shelves," said Christopher.
Investors were also left waiting for clarity on US tax policy as Trump's sweeping tax bill failed to clear a key procedural hurdle as hardline Republicans demanding deeper spending cuts blocked the measure in a rare political setback for the Republican president in Congress.
The Dow Jones Industrial Average rose 331.99 points, or 0.78 per cent, to 42,654.74, the S&P 500 gained 41.45 points, or 0.70 per cent, to 5,958.38 and the Nasdaq Composite gained 98.78 points, or 0.52 per cent, to 19,211.10.
For the week, the S&P 500 gained about 5.3 per cent while the Nasdaq rose 7.2 per cent and the Dow added 3.4 per cent.
Among the S&P 500's 11 major industry indexes, most advanced with energy the sole loser, down 0.18 per cent.
The biggest gainer was healthcare, which ended up 1.96 per cent for the day after a volatile week.
One of its biggest index point boosts was from UnitedHealth Group Inc, which regained ground - rising 6.4 per cent on Friday and leading S&P 500 percentage gains - after eight straight days of steep losses.
Investors were warily expecting strategic changes at the insurer after the Wall Street Journal reported it was under a criminal probe by the Justice Department.
Among other individual stocks, Applied Materials shares slipped 5.3 per cent after the provider of equipment for chip manufacturing missed estimates for second-quarter revenue.
Charter Communications shares rose 1.8 per cent after the cable company said it would buy privately held rival Cox Communications for $US21.9 billion ($A34.1 billion).
Shares in Verizon Communications rose 1.7 per cent after the Federal Communications Commission said Friday it was approving its $US20 billion ($A31 billion) purchase of fibre-optic internet provider Frontier Communications after the largest US telecom company agreed to end its diversity, equity and inclusion programs.
Advancing issues outnumbered decliners by a 2.72-to-1 ratio on the NYSE where there were 207 new highs and 34 new lows.
On the Nasdaq, 2,792 stocks rose and 1,607 fell as advancing issues outnumbered decliners by a 1.74-to-1 ratio. The S&P 500 posted 28 new 52-week highs and no new lows while the Nasdaq Composite recorded 62 new highs and 73 new lows.
On US exchanges, 17.61 billion shares changed hands on Friday compared with the 17.04 billion average from the last 20 sessions.
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7NEWS
37 minutes ago
- 7NEWS
Donald Trump has 'no plans' to speak to Elon Musk as feud deepens over tax bill and billions in contracts
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The Advertiser
40 minutes ago
- The Advertiser
Trump has 'no plans' to speak to Musk as feud persists
Donald Trump says he has no plans to speak with Elon Musk, signalling the US president and his former ally might not resolve their feud over a sweeping tax-cut bill any time soon. Addressing reporters on Friday aboard Air Force One, Trump said he wasn't "thinking about" the Tesla CEO. "I hope he does well with Tesla," Trump said. However, Trump said a review of Musk's extensive contracts with the federal government was in order. "We'll take look at everything," the president said. "It's a lot of money." Trump may get rid of the red Tesla Model S that he bought in March after showcasing Musk's electric cars on the White House lawn, a White House official said, speaking on condition of anonymity. Musk, for his part, did not directly address Trump but kept up his criticism of the massive Republican tax and spending bill that contains much of Trump's domestic agenda. On his social-media platform X, Musk amplified remarks made by others that Trump's "big beautiful bill" would hurt Republicans politically and add to the nation's $US36.2 trillion ($A55.8 trillion) debt. He replied "exactly" to a post by another X user that said Musk had criticised Congress and Trump had responded by criticising Musk personally. Musk also declared it was time for a new political party in the United States "to represent the 80 per cent in the middle!" People who have spoken to Musk said his anger has begun to recede and they think he will want to repair his relationship with Trump, according to one person who has spoken to Musk's entourage. The White House statements came one day after the two men battled openly in an extraordinary display of hostilities that marked a stark end to a close alliance. Tesla stock rose on Friday, clawing back some losses from Thursday's session, when it dropped 14 per cent and lost $US150 billion ($A231 billion) in value, the largest single-day decline in the company's history. Musk, the world's richest person, bankrolled a large part of Trump's 2024 presidential campaign. Trump named Musk to head a controversial effort to downsize the federal workforce and slash spending. Trump feted Musk at the White House a week ago as he wrapped up his role as head of the Department of Government Efficiency. Musk cut only about half of one per cent of total spending, far short of his brash plans to axe $US2 trillion ($A3.1 trillion) from the federal budget. Since then, Musk has denounced Trump's tax-cut and spending bill as a "disgusting abomination". His opposition is complicating efforts to pass the bill in Congress where Republicans hold a slim majority. Trump had initially stayed quiet while Musk campaigned to torpedo the bill, but broke his silence on Thursday, telling reporters he was "very disappointed" in Musk. Musk, who spent nearly $US300 million ($A462 million) in the 2024 elections, said Trump would have lost without his support and suggested he should be impeached. Trump suggested he would terminate government contracts with Musk's businesses, which include rocket company SpaceX and its satellite unit Starlink. The billionaire then threatened to decommission SpaceX's Dragon spacecraft, the only US spacecraft capable of sending astronauts to the International Space Station. Musk later backed off that threat. A prolonged feud could make it harder for Republicans to keep control of Congress in the 2026 midterm elections if Musk withholds financial support or other major Silicon Valley business leaders distance themselves from Trump. Musk had already said he planned to curtail his political spending, and on Tuesday called for "all politicians who betrayed the American people" to be fired in 2026. His involvement with the Trump administration has provoked widespread protests at Tesla sites, driving down sales while investors fretted that Musk's attention was too divided. Donald Trump says he has no plans to speak with Elon Musk, signalling the US president and his former ally might not resolve their feud over a sweeping tax-cut bill any time soon. Addressing reporters on Friday aboard Air Force One, Trump said he wasn't "thinking about" the Tesla CEO. "I hope he does well with Tesla," Trump said. However, Trump said a review of Musk's extensive contracts with the federal government was in order. "We'll take look at everything," the president said. "It's a lot of money." Trump may get rid of the red Tesla Model S that he bought in March after showcasing Musk's electric cars on the White House lawn, a White House official said, speaking on condition of anonymity. Musk, for his part, did not directly address Trump but kept up his criticism of the massive Republican tax and spending bill that contains much of Trump's domestic agenda. On his social-media platform X, Musk amplified remarks made by others that Trump's "big beautiful bill" would hurt Republicans politically and add to the nation's $US36.2 trillion ($A55.8 trillion) debt. He replied "exactly" to a post by another X user that said Musk had criticised Congress and Trump had responded by criticising Musk personally. Musk also declared it was time for a new political party in the United States "to represent the 80 per cent in the middle!" People who have spoken to Musk said his anger has begun to recede and they think he will want to repair his relationship with Trump, according to one person who has spoken to Musk's entourage. The White House statements came one day after the two men battled openly in an extraordinary display of hostilities that marked a stark end to a close alliance. Tesla stock rose on Friday, clawing back some losses from Thursday's session, when it dropped 14 per cent and lost $US150 billion ($A231 billion) in value, the largest single-day decline in the company's history. Musk, the world's richest person, bankrolled a large part of Trump's 2024 presidential campaign. Trump named Musk to head a controversial effort to downsize the federal workforce and slash spending. Trump feted Musk at the White House a week ago as he wrapped up his role as head of the Department of Government Efficiency. Musk cut only about half of one per cent of total spending, far short of his brash plans to axe $US2 trillion ($A3.1 trillion) from the federal budget. Since then, Musk has denounced Trump's tax-cut and spending bill as a "disgusting abomination". His opposition is complicating efforts to pass the bill in Congress where Republicans hold a slim majority. Trump had initially stayed quiet while Musk campaigned to torpedo the bill, but broke his silence on Thursday, telling reporters he was "very disappointed" in Musk. Musk, who spent nearly $US300 million ($A462 million) in the 2024 elections, said Trump would have lost without his support and suggested he should be impeached. Trump suggested he would terminate government contracts with Musk's businesses, which include rocket company SpaceX and its satellite unit Starlink. The billionaire then threatened to decommission SpaceX's Dragon spacecraft, the only US spacecraft capable of sending astronauts to the International Space Station. Musk later backed off that threat. A prolonged feud could make it harder for Republicans to keep control of Congress in the 2026 midterm elections if Musk withholds financial support or other major Silicon Valley business leaders distance themselves from Trump. Musk had already said he planned to curtail his political spending, and on Tuesday called for "all politicians who betrayed the American people" to be fired in 2026. His involvement with the Trump administration has provoked widespread protests at Tesla sites, driving down sales while investors fretted that Musk's attention was too divided. Donald Trump says he has no plans to speak with Elon Musk, signalling the US president and his former ally might not resolve their feud over a sweeping tax-cut bill any time soon. Addressing reporters on Friday aboard Air Force One, Trump said he wasn't "thinking about" the Tesla CEO. "I hope he does well with Tesla," Trump said. However, Trump said a review of Musk's extensive contracts with the federal government was in order. "We'll take look at everything," the president said. "It's a lot of money." Trump may get rid of the red Tesla Model S that he bought in March after showcasing Musk's electric cars on the White House lawn, a White House official said, speaking on condition of anonymity. Musk, for his part, did not directly address Trump but kept up his criticism of the massive Republican tax and spending bill that contains much of Trump's domestic agenda. On his social-media platform X, Musk amplified remarks made by others that Trump's "big beautiful bill" would hurt Republicans politically and add to the nation's $US36.2 trillion ($A55.8 trillion) debt. He replied "exactly" to a post by another X user that said Musk had criticised Congress and Trump had responded by criticising Musk personally. Musk also declared it was time for a new political party in the United States "to represent the 80 per cent in the middle!" People who have spoken to Musk said his anger has begun to recede and they think he will want to repair his relationship with Trump, according to one person who has spoken to Musk's entourage. The White House statements came one day after the two men battled openly in an extraordinary display of hostilities that marked a stark end to a close alliance. Tesla stock rose on Friday, clawing back some losses from Thursday's session, when it dropped 14 per cent and lost $US150 billion ($A231 billion) in value, the largest single-day decline in the company's history. Musk, the world's richest person, bankrolled a large part of Trump's 2024 presidential campaign. Trump named Musk to head a controversial effort to downsize the federal workforce and slash spending. Trump feted Musk at the White House a week ago as he wrapped up his role as head of the Department of Government Efficiency. Musk cut only about half of one per cent of total spending, far short of his brash plans to axe $US2 trillion ($A3.1 trillion) from the federal budget. Since then, Musk has denounced Trump's tax-cut and spending bill as a "disgusting abomination". His opposition is complicating efforts to pass the bill in Congress where Republicans hold a slim majority. Trump had initially stayed quiet while Musk campaigned to torpedo the bill, but broke his silence on Thursday, telling reporters he was "very disappointed" in Musk. Musk, who spent nearly $US300 million ($A462 million) in the 2024 elections, said Trump would have lost without his support and suggested he should be impeached. Trump suggested he would terminate government contracts with Musk's businesses, which include rocket company SpaceX and its satellite unit Starlink. The billionaire then threatened to decommission SpaceX's Dragon spacecraft, the only US spacecraft capable of sending astronauts to the International Space Station. Musk later backed off that threat. A prolonged feud could make it harder for Republicans to keep control of Congress in the 2026 midterm elections if Musk withholds financial support or other major Silicon Valley business leaders distance themselves from Trump. Musk had already said he planned to curtail his political spending, and on Tuesday called for "all politicians who betrayed the American people" to be fired in 2026. His involvement with the Trump administration has provoked widespread protests at Tesla sites, driving down sales while investors fretted that Musk's attention was too divided. Donald Trump says he has no plans to speak with Elon Musk, signalling the US president and his former ally might not resolve their feud over a sweeping tax-cut bill any time soon. Addressing reporters on Friday aboard Air Force One, Trump said he wasn't "thinking about" the Tesla CEO. "I hope he does well with Tesla," Trump said. However, Trump said a review of Musk's extensive contracts with the federal government was in order. "We'll take look at everything," the president said. "It's a lot of money." Trump may get rid of the red Tesla Model S that he bought in March after showcasing Musk's electric cars on the White House lawn, a White House official said, speaking on condition of anonymity. Musk, for his part, did not directly address Trump but kept up his criticism of the massive Republican tax and spending bill that contains much of Trump's domestic agenda. On his social-media platform X, Musk amplified remarks made by others that Trump's "big beautiful bill" would hurt Republicans politically and add to the nation's $US36.2 trillion ($A55.8 trillion) debt. He replied "exactly" to a post by another X user that said Musk had criticised Congress and Trump had responded by criticising Musk personally. Musk also declared it was time for a new political party in the United States "to represent the 80 per cent in the middle!" People who have spoken to Musk said his anger has begun to recede and they think he will want to repair his relationship with Trump, according to one person who has spoken to Musk's entourage. The White House statements came one day after the two men battled openly in an extraordinary display of hostilities that marked a stark end to a close alliance. Tesla stock rose on Friday, clawing back some losses from Thursday's session, when it dropped 14 per cent and lost $US150 billion ($A231 billion) in value, the largest single-day decline in the company's history. Musk, the world's richest person, bankrolled a large part of Trump's 2024 presidential campaign. Trump named Musk to head a controversial effort to downsize the federal workforce and slash spending. Trump feted Musk at the White House a week ago as he wrapped up his role as head of the Department of Government Efficiency. Musk cut only about half of one per cent of total spending, far short of his brash plans to axe $US2 trillion ($A3.1 trillion) from the federal budget. Since then, Musk has denounced Trump's tax-cut and spending bill as a "disgusting abomination". His opposition is complicating efforts to pass the bill in Congress where Republicans hold a slim majority. Trump had initially stayed quiet while Musk campaigned to torpedo the bill, but broke his silence on Thursday, telling reporters he was "very disappointed" in Musk. Musk, who spent nearly $US300 million ($A462 million) in the 2024 elections, said Trump would have lost without his support and suggested he should be impeached. Trump suggested he would terminate government contracts with Musk's businesses, which include rocket company SpaceX and its satellite unit Starlink. The billionaire then threatened to decommission SpaceX's Dragon spacecraft, the only US spacecraft capable of sending astronauts to the International Space Station. Musk later backed off that threat. A prolonged feud could make it harder for Republicans to keep control of Congress in the 2026 midterm elections if Musk withholds financial support or other major Silicon Valley business leaders distance themselves from Trump. Musk had already said he planned to curtail his political spending, and on Tuesday called for "all politicians who betrayed the American people" to be fired in 2026. His involvement with the Trump administration has provoked widespread protests at Tesla sites, driving down sales while investors fretted that Musk's attention was too divided.
ABC News
3 hours ago
- ABC News
Aldi is known for drawing inspiration from big brands. Here's how experts say the retailer does it
It's no secret that Aldi, the supermarket chain that once had the slogan "like brands, only cheaper", sells products visually similar to well-established competitors. In the cereal aisle of each store, brown boxes of Power Grain are reminiscent of their Kellogg's counterpart, and in the snack aisle packets of Blackstone chips appear to draw inspiration from Red Rock Deli. In the US, blue boxes of Aldi-brand cream-filled biscuits are so similar to Oreos that the company behind the snack giant is suing the supermarket for "blatant copying". It's not the first time the chain has landed in legal trouble over its cheaper, duplicated private-label brands. In Australia, there have been several legal cases against Aldi. But intellectual property and consumer experts are not worried about this case creating legal implications for Australian consumers, who they say are largely unphased by Aldi's "phantom labels". "Ultimately the key reason they [Aldi] do this is about visual congruence," retail expert Gary Mortimer said. "So, when we're shopping in a supermarket, it's historically a mundane, habitual, low-involvement decision-making context. 'You walk down an aisle and you think Cadbury is purple. They [consumers] are influenced by pack colour, brand name or packaging shape." Professor Mortimer said when a consumer saw a product similar to another brand's, they might infer it was the same. "What the danger is, is a customer goes, 'Well, actually, their cereal is just as good as the Kellogg's version,'" he said. "Brands themselves spend a lot of money ensuring their brand is high quality. "Then a new player enters with a private label that looks very similar and, therefore, all of that positioning you've done with that product, the private label takes advantage of that position. "Brands would be concerned about that." Professor Mortimer said the private Aldi label was perceived as higher value than, say, the Coles or Woolworths generic-brands. "You won't get Aldi-brand biscuits, you'll get Belmont." In fact, they are so popular, other chains are taking a leaf out of the Aldi playbook, creating their own, cheaper, private brands. He said Woolworths and Coles had created private labels that sold cleaning products and pet food. "To some point, supermarkets understand we won't feed our dog Woolworths pet food but we might feed them a cheaper brand like Baxter's, which is actually Woolworths owned." With Choice ranking Aldi as the cheapest supermarket in Australia in its past five surveys, legal experts say the occasional legal challenges Aldi faces for sailing "close to the wind" with its packaging and branding are largely justified. While Aldi has faced legal challenges in Australia in the past over its packaging and the likeness of its products to rivals, the University of Sydney's Fady Aoun says it is far more challenging to take Aldi to court here. The senior lecturer in intellectual property law said this was because Australia's legal systems were vastly different to those in the US, for instance. "In the realm of trademark law and other forms of forms of policing commercial practices, American law is vastly different to Australian law," he said. "And, in addition to trademark infringement, they have something called unfair competition, which Australian law doesn't adopt "Their trademark law is far more protective of arguably trading interests and goes further than the Australian law in this respect." But there are several ways legal action can be pursued. Last year in Australia the company Hampden Holdings and Lacorium Health Australia successfully sued Aldi Foods for breach of copyright in relation to children's food products. Hampden licenses intellectual property to Every Bite Counts, which sells children's food products under Baby Bellies, Little Bellies and Mighty Bellies, which are sold in Australia. In 2018 and 2019, Aldi engaged the company Motor Design to re-design the packaging for its baby food and product range. The case found that in April 2019, Aldi instructed Motor Design to reuse the Little Bellies brand as the "benchmark" for the re-design of the packaging for its Mamia dry food range. The packaging and labelling were put side by side in court documents to highlight how similar each looked. "Aldi, they sail close to the wind," Dr Aoun said. "They sometimes overstep the mark. Other times they're just short of what is impermissible. "I suspect there is a strong legal department there and that's their business mode." The court found Hampden and Lacorium's owned the packaging designs. Aldi is currently appealing against the court decision. It was approached for comment. "The typical claims in Australia here are trademark infringement, misleading and deceptive conduct and — much more difficult — the common law action of 'passing off'," Dr Aoun said. "Hampden is just a company that holds IP rights and they are the holder of the copyright," Jane Rawlings, an intellectual property barrister said. "So they weren't suing on the trademark; they were suing on the look of the packaging, how it presents itself to consumers. "That was successful because the court had found Aldi had deliberately modelled their snacks on the Baby Bellies." Separately, Aldi won a federal court appeal in 2018 against a deceptive conduct ruling over hair care products brought against the supermarket chain by Moroccanoil Israel. Dr Rawlings said this was harder to prove. "You have to show there is reputational goodwill in the brand, and in this purpose it is by using a similar name, brand or look that misleads consumers and that damages the goodwill of the brand because they're being diverted to a cheaper alternative or because the brand owner is losing sales," she said. "You have to still prove the conduct has been deceptive and what Aldi do is tread a fine line where they've got a lookalike brand but it's not enough to argue consumers are being misled." In the UK in 2023, Cider producer Thatcher's successfully won a legal battle against Aldi, claiming it "copycatted" its Cloudy Lemon Cider in "taste and appearance". This was a lookalike trademark case that argued Aldi's Taurus drink had been "deliberately riding on the coat-tails" of the cider company's reputation as a brand. Dr Rawlings said she believed registering a brand as a trademark was one of the best ways to protect it. "To be honest, and if I were a brand owner trying to protect the look of packaging, I'd be looking very seriously at trademarking registration because it's relatively cheap and then you can basically sue on the trademark registration." Ultimately, experts agree the impact on consumers is relatively low. "What Aldi will typically say is our consumers are not confused [and that] while they may draw inspiration from leading brands there's no confusion people know what they're getting," Dr Aoun said.
