European Stocks Are Complacent on Tariffs, Says Goldman's Bell
'There's a little bit of an element of the market being perhaps a little bit too complacent in the very near term on the risks around all of this,' Bell, Goldman's senior European equity strategist, said in a Bloomberg TV interview.
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Yahoo
24 minutes ago
- Yahoo
Slow US job gains expected in July; unemployment rate forecast rising to 4.2%
By Lucia Mutikani WASHINGTON (Reuters) -U.S. job growth likely slowed in July, with the unemployment rate forecast rising back to 4.2%, but that probably would be insufficient to spur the Federal Reserve to resume cutting interest rates soon as tariffs are starting to fan inflation. The anticipated slowdown in nonfarm payrolls in the Labor Department's closely watched employment report on Friday would mostly be payback after a surprise surge in state and local government education boosted employment gains in June. The U.S. central bank on Wednesday left its benchmark interest rate in the 4.25%-4.50% range. Fed Chair Jerome Powell's comments after the decision undercut confidence the central bank would resume policy easing in September as had been widely anticipated by financial markets and some economists. Though Powell described the labor market as being in balance because of supply and demand both declining at the same time, he acknowledged that this dynamic was "suggestive of downside risk." Job growth has slowed amid uncertainty over where President Donald Trump's tariff levels will eventually settle. Trump on Thursday slapped dozens of trading partners with steep tariffs ahead of a Friday trade deal deadline, including a 35% duty on many goods from Canada. The White House's immigration crackdown has reduced labor supply as has an acceleration of baby boomer retirements. "We just don't have a roadmap yet with respect to tariffs, and now that it's coming into place, I think that can certainly help, but if you're thinking about what you're planning for your business over the next two to three years ... you don't want to make that decision until you know what your costs of running your business are going to be," said Michael Reid, senior U.S. economist at RBC Capital Markets. Nonfarm payrolls likely increased by 110,000 jobs last month after rising by 147,000 in June, a Reuters survey of economists showed. That reading would be below the three-month average gain of 150,000. Estimates ranged from no jobs added to an increase of 176,000 positions. An economist predicting no change in payrolls pointed to the jump in state and local government education jobs in June, which accounted for nearly half of the employment gains that month. "When the academic year ends, there is a huge drop in payroll levels at schools," said Stephen Stanley, chief U.S. economist at Santander U.S. Capital Markets. "The fact that there were fewer reductions than usual in June suggests to me that more of the usual wave of reductions came in July." Stanley also argued that there had been a torrent of anecdotal and survey evidence suggesting that businesses large and small slowed their hiring activity this summer in the face of elevated policy uncertainty. This led Stanley to anticipate private sector payrolls growth slowed further in July rather than accelerated as most economists expected after the economy added the fewest jobs in eight months in June. LOW BREAK-EVEN NUMBER Federal government job losses as the Trump administration wields the axe on headcount and spending, excluding immigration enforcement, could mount after the Supreme Court gave the White House the green light for mass firings. But the administration has also said several agencies were not planning to proceed with layoffs. The reduction in immigration flows means the economy now needs to create roughly 100,000 jobs per month or less to keep up with growth in the working age population. The decline in the unemployment rate to 4.1% in June was in part due to people dropping out of the labor force. July's anticipated rise would still leave the jobless rate in the narrow 4.0%-4.2% range that has prevailed since May 2024. "The July jobs report is unlikely to shake the Fed out of its 'wait-and-see' posture," said Gregory Daco, chief economist at EY-Parthenon. "But it will add further evidence that the labor market is gradually losing momentum." Financial markets have pushed back an anticipated September rate cut to October. With tariffs starting to raise inflation, some economists believe the window for the Fed resuming policy easing this year is closing. But others still believe the Fed could still cut rates in September, especially if the Bureau of Labor Statistics' preliminary payrolls benchmark revision in September projects a sharp decline in the employment level from April 2024 through March this year. The Quarterly Census of Employment and Wages, derived from reports by employers to the state unemployment insurance programs, has indicated a much slower pace of job growth between April 2024 and December 2024 than payrolls have suggested. "If it's an ugly downward revision, the Fed will move, there is no question," said Brian Bethune, an economics professor at Boston College.
Yahoo
24 minutes ago
- Yahoo
Morning bid: 'Tariffs - use this version, please'
A look at the day ahead in European and global markets from Stella Qiu: It is tariff deadline day and President Donald Trump delivered by slapping fresh levies on imports from dozens of countries, including those that do not have a trade deal yet. Rates were set at 35% for Canada, 25% for India, 20% for Taiwan and 19% for Thailand. Switzerland got a whopping 39% -- one of the steepest -- raising the question: what's Trump got against the Swiss? Not buying enough American chocolate or watches? The big day comes after months of posturing, meetings, delays and truces, which prompted some investors to question what was a real threat and what was a bluff. Indeed, there is still much to be resolved. Arguably, most levies are lower than those threatened on April 2, which back then sent markets into a tailspin. Plus the big trade deals with Japan and the European Union have been reached while talks with China and Mexico are still ongoing. That is probably why market reaction this time has been much more muted. Sure, most Asian shares fell, but only modestly. South Korea is an exception, tumbling over 3%, in part due to domestic tax cuts being rolled back. Taiwan's president said the 20% levy is only temporary and is expected to be reduced further when a deal is reached. Wall Street and European shares did not seem to be too bothered by the tariff news. EUROSTOXX 50 futures slipped 0.3%. Both Nasdaq futures and S&P 500 futures fell 0.2%, thanks to a 6% tumble in Amazon after its earnings failed to meet lofty expectations. Now, with the tariff news out of the way, euro zone flash CPI is due later in the day and expectations are for a slight easing to 1.9% in July from 2.0% in annual terms. Markets have only priced in half a cut from the European Central Bank by early next year. And then it's all about waiting for payrolls, which will be pivotal for hopes for a rate cut from the Federal Reserve in September, which is now priced at just 40%, way off 75% a month ago. Forecasts are centred on a 110,000 rise in July, while the jobless rate likely ticked up to 4.2% from 4.1%. Any upside surprises could price out the chance of a move next month, giving dollar bulls another reason to rally. The greenback is headed for the best week - with a gain of 2.5% against its peers - in nearly three years, solidifying its recent uptrend from a three-year low. It has found support from a hawkish Fed that has held off policy easing on tariff risks. And indeed, the Fed's preferred gauge of inflation came in a tad hotter overnight, showing some tariff impact. Key developments that could influence markets on Friday: -- Euro zone flash CPI for July -- U.S. payrolls for July, ISM Manufacturing survey Trying to keep up with the latest tariff news? Our new daily news digest offers a rundown of the top market-moving headlines impacting global trade. Sign up for Tariff Watch here.
San Francisco Chronicle
26 minutes ago
- San Francisco Chronicle
Musk, a social media powerhouse, boosts fortunes of hard-right figures in Europe
ROME (AP) — Hard-right commentators, politicians and activists in Europe have uncovered a secret to expanding their influence: engaging with Elon Musk. Take the German politician from a party whose own domestic intelligence agency has designated as extremist. Her daily audience on X surged from 230,000 to 2.2 million on days Musk interacted with her posts. She went on to lead her party to its best-ever electoral showing. Or the anti-immigration activist in Britain, who was banned from Twitter and sentenced to 18 months in prison for contempt of court. Since Musk let him back on the platform in late 2023, he's mentioned, reposted or replied to the billionaire more than 120 times on X — and gained nearly a million followers. Even a little-known social-media influencer turned politician from Cyprus has benefited from the Musk effect. Before winning a surprise seat in the European Parliament, where he's advocated for Musk, the influencer seemed to have one ambition: to hug the world's richest man. He got his hug — and political endorsements. On days Musk has interacted with his account on X, the man's audience exploded from just over 300,000 to nearly 10 million views. Elon Musk may have tumbled from political grace in Washington -- he stepped down as an adviser to President Donald Trump in May and has since traded insults with the president -- but as he works to build his own political party, his power on X his power remains unchecked. Musk's influence on the platform he bought for $44 billion has made him a kingmaker at home and abroad. Among those he has chosen to cultivate are hard-right politicians and insurgent influencers across Europe, according to an Associated Press analysis of public data. His dominance, which has real-world financial and political impacts, is fueling concerns in Europe about foreign meddling -- not from Russia or China this time, but from the United States. 'Every alarm bell needs to ring,' said Christel Schaldemose, a vice president of the European Parliament who works on electoral interference and digital regulation. 'We need to make sure that power is not unbalanced.' In seeking to quantify Musk's effect on European politics, The Associated Press analyzed more than 20,000 posts over a three-year period from 11 far-right European figures across six countries who frequently promote a hard-right political or social agenda and had significant interactions with Elon Musk since he purchased Twitter. Tens of thousands of posts by Musk on Twitter, now known as X, were also collected. The AP used the records, obtained from data provider Bright Data, to analyze how Musk's account interacted with the European influencers, and vice versa, and the extent to which Musk's engagement boosted their reach. These case studies are not meant to be representative of a broad universe; rather, they showcase the ways in which Musk's engagement can have an impact on local influencers who share his views. Due to limitations on data collection, the dataset is not a complete record of all posts made by these accounts. Even so, it captured at least 920 instances in which one of the European accounts tagged, replied or otherwise attempted to interact with Musk's account, and at nearly 190 instances where Musk's own posts interacted with the Europeans. The AP also analyzed records of daily follower counts, using data from Social Blade, to measure any growth in the European accounts' audience that occurred in the wake of Musk's online interactions. This kind of analysis is no longer possible. In March, Social Blade removed X from its analytics, saying that X had increased its data access fees to prohibitive levels, making the platform harder to research. Among those included in AP's analysis are several people who have run into legal trouble in their own countries. An anti-immigrant agitator in the U.K., for example, was sentenced in October to 18 months in prison for violating a court order blocking him from making libelous allegations against a Syrian refugee. A German politician was convicted last year of knowingly using a Nazi slogan in a speech. An Italian vice premier was acquitted in December of illegally detaining 100 migrants aboard a humanitarian rescue ship. Others examined by AP were an influencer known as the 'shieldmaiden of the far-right;' a German activist dubbed the 'anti-Greta Thunberg' now living in what amounts to political exile in Washington, D.C.; and two politicians who have advocated for the interests of Musk's companies as those firms seek to expand in Europe. AP's analysis shows how Musk is helping unite nationalists across borders in common cause to halt migration, overturn progressive policies and promote an absolutist vision of free speech. While his efforts have sparked backlash in some countries, Musk's promotion of a growing alliance of hard-right parties and individuals has helped rattle the foundation of a transatlantic bond that has guided U.S. and European relations for over eight decades. Engagement from Musk does not guarantee a surge in followers or page views. But AP found it can have a huge impact, especially on up-and-coming influencers. One account that began with around 120,000 followers when Musk took over Twitter in October 2022 topped 1.2 million by January of this year. Seven other European accounts saw six-figure increases in their follower counts over the same period. Most of the 11 accounts examined saw triple-digit percentage increases in their followers. Even some that grew more steadily on their own before Musk interacted with them saw their follower counts rise sharply after he began engaging with their posts. Similarly, on days Musk interacted with a post, its account saw its views soar — in most cases, accruing two to four times as many views, with a few seeing boosts 30 or 40 times their normal daily viewership. Musk is not the only factor influencing the growth of these accounts, of course, but their rising fortunes are a measure of how the platform has evolved under his leadership. When Musk acquired X, he pledged to turn it into a haven for free speech, declaring himself a 'free speech absolutist.' AP's analysis adds to growing evidence that instead of serving as a neutral forum for free speech, X amplifies Musk's speech. This shift has given him sweeping power to direct people's attention. 'There's an extreme asymmetry in the way Musk is able to leverage and shape the platform,' said Timothy Graham, an associate professor in digital media at the Queensland University of Technology in Brisbane, Australia, who has studied data anomalies on X. 'There's an unequivocal sense when you go onto the site that you're entering Musk's kingdom.' Musk's megaphone: Bigger than Trump and Taylor Swift Since he acquired Twitter in 2022, Musk has come to dominate the platform. His followers have more than doubled, to more than 220 million — growth so tremendous that it easily outpaced the other Top 10 accounts. Not even Taylor Swift has been able to keep up. Indian Prime Minister Narendra Modi, whose followers grew by 21 million — or 25% — from October 2022 through January, clocked a distant second. Donald Trump's followers grew by 14%, or around 12 million, while Taylor Swift mustered a mere 3% growth, or 3 million new followers. None of the other Top 10 accounts have shown such consistent follower growth, month after month, AP found. The result is a further concentration of power for the world's richest man, who now commands the most popular account on a social media platform used by hundreds of millions of people around the world. Given the opacity of the algorithms that power X, it's hard to determine with certainty what array of factors might be driving such unusual — and unusually consistent — growth in Musk's account. But researchers who have analyzed data patterns on X argue that the platform's algorithm has, at times, been altered to amplify Musk's voice. How X promotes content is a growing point of contention in Europe. In January, the European Union expanded its investigation of X to assess how the platform pushes content to users and why some material goes viral. In February, French prosecutors opened a separate investigation into X over allegations that Musk changed the platform's algorithms to promote biased content. Musk's public attacks on left-leaning politicians, support for hard-right policies and loose handling of facts have prompted rebukes from British Prime Minister Keir Starmer, former German Chancellor Olaf Scholz, French President Emmanuel Macron, Spanish Prime Minister Pedro Sanchez, Italian President Sergio Mattarella, and Norwegian Prime Minister Jonas Gahr Støre. X did not respond to requests for comment. Musk is X's kingmaker Musk's dominance creates a strong incentive for people seeking to increase their clout — or their revenues, through the platform's monetization options — to exploit these network effects and try to get Musk to engage with their content. 'People know that he's gearing everything towards him,' said Graham, the digital media scholar in Australia. 'They're doing everything they can to get close to this person because he is the moneymaker.' Germany's Alternative for Germany (AfD) party, for example, has benefited from the Musk effect. AfD coleader Alice Weidel helped lead the party, which advocates for nationalist and anti-immigrant policies, to second place in German parliamentary elections in February. When Musk interacted with her account in the run-up to those elections, the average number of daily views she got rose from about 230,000 to 2.2 million. Germany's domestic intelligence agency in May classified Weidel's party as a right-wing extremist organization, which would subject the AfD to greater surveillance. The party, which maintains that it's a victim of politically motivated defamation, promptly filed a lawsuit against the move, which Musk, along with top U.S. officials blasted as an attack on free speech. The designation has been suspended pending judicial review. The AfD denies any association with Germany's Nazi past — though, in a chat with Musk livestreamed on X in January, Weidel falsely described Hitler as a 'communist, socialist guy.' The chat has gotten 16 million views. Musk also appeared at AfD rallies and endorsed the party in a German newspaper. AfD officials did not respond to requests for comment. Naomi Seibt, a German climate skeptic, pinged Musk nearly 600 times between October 2022 and Jan. 2025. Musk finally engaged in June 2024, when he asked her to explain why the AfD is so controversial in Germany. Since then, Musk has replied to, quoted or tagged Seibt more than 50 times, and her followers have grown by more than 320,000 since Musk took over the platform. On days Musk interacted with Seibt, her posts, on average, got 2.6 times as many views. 'I didn't intentionally 'invade' Elon's algorithm,' Seibt told AP. 'Obviously Elon has a lot of influence and can help share a message even with those who are usually glued to the legacy media, particularly in Germany.' Seibt said she's now living in the United States because she fears political persecution in Europe. 'Washington DC is the political heart of America and thus also the safest place for me to be,' she said. 'I fear the German state wants me locked up.' Musk has also boosted the influence of political insurgents in the U.K. Days before British national elections last July, Musk took to X to ask Nigel Farage, the leader of the populist Reform U.K. party: 'Why does the media keep calling you far-right? What are your policies?' Farage replied eagerly: 'Because we believe in family, country and strong borders. Call me!' In Spain, Rubén Pulido, a columnist for a newspaper published by the populist Vox party's think tank, hit the jackpot in August, when Musk responded to two posts in which he argued that rescue boats operated by nongovernmental organizations effectively help smugglers move migrants to Europe. Pulido's visibility soared. On days Musk engaged with him, his account got nearly 300,000 views — roughly three times more than usual. When Musk didn't interact with Pulido's account, the results were just as clear. In January, he again inveighed against migrant rescues and sought to get Musk's attention. 'Hi @elonmusk! Speak up,' he urged. Three weeks later, he tweeted: 'Perhaps @elonmusk might find this interesting.' That post garnered just 5,128 views. Pulido did not respond to requests for comment. While Musk helped boost the accounts of such fringe parties and rising influencers, his interactions did not provide as stark a benefit to more established politicians, AP found. That was true for both Italian Prime Minister Giorgia Meloni, whose ruling Brothers of Italy party has neo-fascist roots, and Dutch politician Geert Wilders, an anti-Islamic firebrand who has been called the Dutch Donald Trump. What happens on X doesn't always stay on X Musk's interactions online have spilled into political endorsements, policy advocacy -- and money. X helps users monetize their accounts, through ad revenue sharing and paid subscription programs as well as direct fundraising links. That means a surge in attention on X can bring a surge in revenue. Tommy Robinson, a British anti-immigration agitator who was released from prison in May, after serving a reduced sentence of seven months for contempt of court, has a link to his fundraising page on his X profile. Interactions from Musk more than doubled Robinson's daily views, from around 380,000 to nearly 850,000. Robinson — whose real name is Stephen Yaxley-Lennon — could not be reached for comment Radio Genoa, an account reportedly investigated by Italian authorities last year for allegedly spreading hate speech about migrants, used X to publicize a call for a GoFundMe campaign to raise money for legal defense. Radio Genoa has pinged Musk dozens of times over the last three years, and for good reason: On days Musk engaged with him, the views on his account doubled. Radio Genoa's followers surged from less than 200,000 before Musk's engagement to over 1.2 million. Radio Genoa could not be reached for comment. Eva Vlaardingerbroek -- a conservative Dutch political commentator dubbed the 'shieldmaiden of the far-right' whose account Musk has engaged with three dozen times -- uses X to solicit tips and has creator status, which allows her to charge subscription fees. So does Seibt, the German activist -- though she told AP her earnings from X aren't enough to sustain herself. Vlaardingerbroek did not respond to requests for comment. Musk has also advocated for Matteo Salvini, vice premier of Italy and the leader of the hard-right, anti-migrant League party. On X, Musk's interactions boosted Salvini's daily visibility more than fourfold. Offline, Salvini has urged Italy to move ahead with controversial contracts for Starlink and pushed back against EU efforts to regulate content on X. Before Fidias Panayiotou — a 25-year-old social media influencer from Cyprus with no political experience — won a surprise seat as an independent in the European Parliament last year, he spent weeks camped outside Twitter and Space X headquarters in a highly publicized quest to hug the world's richest man. In January 2023, his wish came true. Their embrace went viral. Soon, Musk was interacting with Panayiotou's posts on a variety of subjects, expanding his typical audience on X by more than 3,000%. Since taking his seat, Panayiotou -- whose positions often also reflect the views of Cyprus' traditional leftist establishment -- has praised X on the floor of the European Parliament, pushed back against regulations that impact the platform, and credited Musk with sparking his call to fire 80% of EU bureaucrats. Musk, evidently, was pleased. 'Vote for Fidias,' he posted on X, an endorsement that was viewed more than 11.5 million times. 'He is smart, super high energy and genuinely cares about you!' In July, after AP asked for comment, Panayiotou posted a video to dispel any impression that he was Musk's puppet. 'I don't have any relationship with Elon Musk,' he said. 'We haven't spoken at all since we hugged, neither through messages, nor by phone, and I've never invited him anywhere.' He said that Musk, unprompted, began reposting his content after he was elected to the European Parliament. 'I don't think it's a danger to democracy honestly that Elon Musk supports me,' Panayiotou explained in another video. 'I think this is the beauty of democracy.' —-
