Volex profits rise by a quarter as demand for its EV chargers soars
Profits at Lord Rothschild's cable manufacturing business rose by a quarter last year amid booming demand for its electric vehicle chargers.
Volex's financial performance was even better than bosses had flagged only a couple of months ago. That, along with an expectation that President Trump's trade war would have only a 'limited direct impact', sent its shares 55p, or 17.4 per cent, higher to 370½p in afternoon trading, a nine-month high.
Volex's roots can be traced back to Ward & Goldstone, a Mancunian maker of lamps, torches and kettles that was founded in 1892. It started using Volex as a brand name in the early 1900s but it was not until 1984 that the company's name was formally changed.
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Reuters
19 minutes ago
- Reuters
TRADING DAY Markets 'run it hot'
ORLANDO, Florida, June 26 (Reuters) - TRADING DAY Making sense of the forces driving global markets By Jamie McGeever, Markets Columnist The dollar slid and stocks surged on Thursday as investors ramped up bets that U.S. interest rates will soon be cut, after President Donald Trump, in his latest attack on Fed Chair Jerome Powell, reportedly said he may name his replacement early. In my column today I look at where the "pain trades" for investors may lie in the second half of the year. More on that below, but first, a roundup of the main market moves. If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today. Today's Key Market Moves Markets 'run it hot' Juice the economy. That seems to be the Trump administration's broad plan, which will be achieved in time by tax cuts, deregulation, and loose fiscal policy. And loose monetary policy. Most definitely loose monetary policy. Pressure from the White House on the Fed to cut interest rates is nothing new. The president has unleashed several verbal tirades towards Chair Jerome Powell for not doing so, branding him "very stupid", "very dumb" and of "low IQ". Powell's term as chair expires in May next year, and he insists he can't be fired. So Trump is now considering naming his replacement early, who could operate as a "shadow" Fed chair, undermining Powell's influence. It remains to be seen how effective or even viable this would be. But the fact it's being floated is pouring fuel on market moves that were already beginning to catch fire - the dollar is tumbling, Fed rate cut bets are being ramped up, stocks are flying, and "Big Tech" is getting its mojo back. The dollar on Thursday slumped to its lowest in more than three years against a basket of major currencies - performing especially poorly against European currencies - and is on track for its worst first half of any year in over half a century. The Trump administration will likely be quite happy with the way markets are reacting - a more export-competitive dollar, lower short-term yields, and higher stocks. And if you look further out, higher nominal growth and above-target inflation to inflate away the debt. The danger is these moves snowball and the dollar goes into a more rapid freefall, triggering widespread market dislocation. But we're not there yet, and investors are running with it. Hawkish Fed could inflict markets' biggest 'pain trades' As the first half of the year closes, financial markets are in limbo, waiting to see how the kaleidoscope of global trade deals will – or won't – come together after July 9, when Washington's pause on its "reciprocal tariffs" expires. But if investors are wrong-footed, which trades will be the most vulnerable? The state of suspended animation in today's markets is remarkably bullish. U.S. growth forecasts are rising, S&P 500 earnings growth estimates for next year are running at a punchy 14%, corporate deal-making is picking up, and world stocks are at record highs. The uncertainty immediately following President Donald Trump's April 2 "Liberation Day" tariffs seems a distant memory. The relief rally has ripped for nearly three months, only taking a brief pause during the 12-day war between Israel and Iran. It's a pretty rosy outlook, some might say too rosy. If we do see a pullback, what will be the biggest "pain trades"? The major pressure points are, unsurprisingly, in asset classes and markets where positioning and sentiment are most overloaded in one direction. As always with crowded trades, a sudden price reversal can push too many investors to the exit door at once, meaning not all will get out in time. To identify the most overloaded positions, it's useful to look at the Bank of America's monthly global fund manager survey. In the June survey, the top three most-crowded trades right now are long gold (according to 41% of those polled), long "Magnificent Seven" tech stocks (23%), and short U.S. dollar (20%). This popularity, of course, means these three trades have been highly profitable. The "Mag 7" basket of Nvidia, Microsoft, Meta, Apple, Amazon, Alphabet and Tesla shares accounted for well over half of the S&P 500's 58% two-year return in 2023 and 2024. The Roundhill equal-weighted "Mag 7" ETF is up 40% this year, and the Nasdaq 100 index, in which these seven stocks make up more than half of the market cap, this week hit a record high. Meanwhile, the gold price has virtually doubled in the last two-and-a-half years, smashing its way to a record high $3,500 an ounce in April. And the dollar is down 10% this year, on track for its worst first half of any year since the era of free-floating exchange rates was established more than 50 years ago. In some ways, these three trades are an offshoot of one fundamental bet: the deep-rooted view that the Federal Reserve will cut U.S. interest rates quite substantially in the next 18 months, a scenario that would make all these positions money-spinners. Even though the Fed's revised economic projections last week were notable for their hawkish tilt, rates futures markets have been upping their bets on lower rates, largely due to dovish comments from several Fed officials and a sharp fall in oil prices. Traders are now predicting 125 basis points of rate cuts by the end of next year. Economists at Morgan Stanley are even more dovish, forecasting no change this year but 175 basis points of cuts next year. That would take the Fed funds range down to 2.5%-2.75%. Lower borrowing costs would be especially positive for shares in companies that can expect high future growth rates, like Big Tech. Low rates are also, in theory, good for gold, a non-interest-bearing asset. But, on the flip side, it's difficult to construct a scenario in which the economy is chugging along, supporting equity performance, while the Fed is also slashing rates by 175 bps. Easing on that scale and at that speed would almost certainly signal that the Fed was trying to put out a raging economic fire, most likely a severe slowdown or recession. While risk assets may not necessarily collapse in that environment, over-extended positions would be exposed. Granted, this isn't the first time investors have banked on Fed cuts in the past three years, and we have yet to see a major blow-up as a result. Markets have handled "higher-for-longer" rates much better than many observers warned, soaring to new highs in the process. Still, if "pain trades" do emerge in the second half of the year, it will likely be because of one sore spot: a hawkish Fed. What could move markets tomorrow? Want to receive Trading Day in your inbox every weekday morning? Sign up for my newsletter here. Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, opens new tab, is committed to integrity, independence, and freedom from bias.
Reuters
23 minutes ago
- Reuters
US demand for China-made goods ebbs on tariff worries; ocean shipping rates drop
LOS ANGELES, June 26(Reuters) - Rates for shipping cargo containers from China to the U.S. have dropped by more than half since earlier this month, as imports rebounded less than expected after the slump that followed President Donald Trump slapping 145% tariffs on China. Trump quickly reversed course by lowering the rate to 30%. That cost increase on goods from the nation's No. 1 ocean trading partner remains significant, especially at a time when U.S. economic data is signaling weakness. Rates on the closely watched Shanghai-to-U.S. West Coast route appear to have found a near-term floor at around $2,500 per 40-foot container, after peaking early this month at around $6,000, Jefferies shipping analyst Omar Nokta said in a note on Thursday. Shipping rates had surged to their recent peaks after Trump cut tariffs on China to 30% from 145%. That led U.S. importers to rush in new orders on goods they had halted because of the astronomical levy. The retreat in shipping rates "is a sign that the recent surge in imports to the U.S. ... will fail to have the lasting impact we had initially expected," maritime consultancy Drewry said on Thursday. Drewry's World Container Index fell 9% for the second consecutive week following five weeks of gains. U.S. consumers have yet to feel the full effects of tariffs because many importers stockpiled goods ahead of the new duties - delaying price hikes. Now, time is running out. Walmart, the world's largest retailer and top ocean importer, warned it would start raising prices in late May and June. Federal Reserve Chair Jerome Powell on Wednesday said he expects tariffs to start stoking inflation this summer. Tariffs have already risen on some goods, but there is a coming July 9 deadline for higher levies on a broad set of countries. No one is certain whether Trump will back down to a 10% baseline tariff that analysts are using as a minimum, or whether he will impose something more aggressive. Some maritime experts say Trump has painted the U.S. into a corner with his trade war. Import shipments to the U.S. virtually ceased in April, due to Trump's short-lived 145% tariffs on China. That volume is rebounding. But the bounce may be less than expected as tariffs begin to weigh on consumer spending and economic growth. "The more volume goes down, the less economic activity goes up. The less volume goes down, the more inflation goes up," said John McCown, senior fellow at the Center for Maritime Strategy. "There is actually no comfortable place to land."
The Sun
27 minutes ago
- The Sun
Taxpayers will be left counting the cost for years to come if Labour rebels block welfare cuts
Taking the PIP FOR those Labour MPs excitedly plotting against the PM while virtue-signalling about the cruelty of cutting benefits, we have a reality check. According to the Institute for Fiscal Studies, the welfare Bill would actually RISE by a further £8billion even if the changes were fully implemented. Spending on health-related benefits would reach a whopping £61billion by the end of the decade. That's up by £25billion on the figure in 2019-20, before Covid. If Labour rebels block the changes, this figure balloons to £66billion. It now looks inevitable Starmer will be forced to retreat, having abandoned his pledge to stand firm and instead offering 'conversations' with the rebels. Labour MPs might well feel better and pat themselves on the back on Twitter for being 'progressive' — once again the buzzword of the Left. But taxpayers will be left counting the cost for years to come. The PM, meanwhile, stands seriously weakened less than a year after winning a landslide. What a self-inflicted disaster. Angela Rayner says lifting 2-child benefit cap not 'silver bullet' for ending poverty after demanding cuts for millions Red-handed DO as I say, not as I do. They should carve that mantra in stone above the entrance to the Department of Energy. Ed Miliband loves telling ordinary folk to make expensive sacrifices to save the planet. Yet it's somehow no surprise that His Greenness flew at least one Net Zero official on a 10,000-mile round-trip to Brazil on a pointless mission to check whether hotels they considered booking for him and his team were suitable. Apparently we must all ditch the gas boilers that keep us warm. But pumping out tonnes of CO2 is completely fine if it's in pursuit of a perfect hotel suite for the minister. Miliband's hypocrisy will probably go down badly with the Climate Change Committee quango. It says his failure to lift expensive green levies from electricity bills means punters aren't buying enough electric cars or heat pumps. It seems even his eco warrior mates don't think he's up to the job. No to Nanny BRITS generally hate being told what to do — especially when it makes no sense. So why don't the busybodies presiding over our increasingly nanny state just leave us alone? Since when was having a pint or a flutter such a danger to society? Why must we constantly be told to watch where we're going, hold the handrail, mind our heads and our words — even our thoughts? No one asked for any of this. Nanny doesn't know best. We do.
