China robotaxis, Indian pharma among hedge fund top picks at Sohn Hong Kong
By Summer Zhen
HONG KONG (Reuters) -Hedge funds revealed their top investment ideas, ranging from Chinese self-driving taxis, an Indian drug retailer, to a Korean nuclear plant builder, at the annual Sohn investment conference in Hong Kong.
This year's picks are geographically more diverse compared to last year, suggesting that investors are actively seeking to spread their exposure to counter tariff uncertainties and market volatility.
San Francisco-based Flight Deck Capital sees upside potential in Chinese search engine giant Baidu, betting on its fast-growing auto-driving business.
Similar to Google's self-driving unit Waymo, Baidu's Apollo Go "is the only robo-taxi player in China that's not dependent on the capital markets to scale," Flight Deck founder and managing partner Jay Kahn said at the conference on Friday.
He expects China's taxi and ride-share industry to grow to around $237 billion by 2034, with Apollo taking a 15% market share. But that segment, together with Baidu's cloud business, is currently given zero valuation by the market, he said.
Notably, investor optimism on Chinese firms going overseas has not been derailed by the escalating U.S.-China trade war.
Hong Kong's Apeiron Capital pitched Chinese ride-hailing company DiDi Global, citing its improving margin at home and its quick market share building in Latin America. Meanwhile Triata Capital is upbeat on Chinese discount e-commerce player PDD, the owner of Temu.
"One statistic that a lot of people don't know is that their MAU right now is bigger than Amazon," Triata CIO Sean Ho said, referring to Temu's monthly active users.
INDIA
Two investors set their sights on India's healthcare space.
Singapore's Arisaig Partners favors MedPlus Health Services, a leading pharmacy chain in India, as its private label products strengthen its low-price proposition, widening the gap with competitors.
"Inflation is lower, government is focusing on the middle class and consumer spending is coming off a low base. I simply believe this is the time when the consumer space in general will do better," Vatsal Mody, partner and head of India research at Arisaig Partners said in an interview ahead of the conference.
India-based hedge fund startup Panvira Management is bullish on Piramal Pharma, a contract development and manufacturing organisation (CDMO), expecting its growth to accelerate to high teens and to benefit from tax rate normalisation.
SECURITY AND ACTIVISTS
Other emerging hedge funds focused on opportunities in the security sector driven by geopolitical conflicts.
Jon Jhun, who manages MY.Alpha Management's new Korea-focused fund, chose Hyundai Engineering & Construction, which engages in nuclear plant engineering, procurement and construction (EPC).
"Korea dominates the ex-Russia, ex-China nuclear supply chain," he said.
Hong Kong's Frontline Global Management picked Spanish defence firm Indra Sistemas, believing the firm will win more European contracts.
On the activist investor side, UK hedge fund Palliser Capital disclosed a 3% stake in Japan's Toyo Tire at the event, urging the tire maker to boost shareholder returns by setting a "best-in-class" performance target and releasing its excess capital of about $900 million to shareholders.
Seth Fischer's Oasis Management is long Japanese entertainment complex chain Round One, betting it will gain a re-rating as it ventures into the restaurant industry aiming to bring Michelin-quality Japanese food to the U.S.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Bloomberg
an hour ago
- Bloomberg
Chinese Hacked US Telecom a Year Before Known Wireless Breaches
Corporate investigators found evidence that Chinese hackers broke into an American telecommunications company in the summer of 2023, indicating the country's attackers penetrated the US communications system earlier than publicly known. Investigators working for the telecommunications firm discovered last year that malware used by Chinese state-backed hacking groups was on the company's systems for seven months starting in the summer of 2023, according to two people familiar with the matter and a document seen by Bloomberg News. The document, an unclassified report sent to Western intelligence agencies, doesn't name the company where the malware was found and the people familiar with the matter declined to identify it.
Yahoo
an hour ago
- Yahoo
Stock market today: Dow, S&P 500, Nasdaq hum along as Treasury yields sink after weak ADP jobs data
US stocks were a mixed bag on Wednesday as Wall Street digested a sharp slowdown in private-sector hiring growth, with one eye on prospects for US-China trade talks as a steel tariff hike kicked in. The S&P 500 (^GSPC) was narrowly positive on the day, while the tech-heavy Nasdaq Composite (^IXIC) rose more than 0.3%. The Dow Jones Industrial Average (^DJI) slipped about 0.2%, ending a four-day winning streak. Meanwhile, the 10-year Treasury yield (^TNX) and the 30-year Treasury yield (^TYX) both fell nearly 10 basis points as investors digested a slew of weaker-than-expected economic data. The 10-year hovered near 4.36%, its lowest level since May 9. On the data front, the ADP National Employment Report showed private-sector hiring growth fell sharply last month. Private payrolls increased by just 37,000, the lowest in over two years and well below expectations. Meanwhile, in another sign of tariff uncertainty weighing on economic data, the Institute for Supply Management's Services PMI registered a reading of 49.9 in May, below the 51.6 seen in April and lower than the increase to 52 economists had expected. May's data marked just the fourth time the services sector has fallen into contraction in the past five years. Trump lashed out at Jerome Powell after seeing the ADP report early Wednesday, urging the Federal Reserve chair to lower interest rates. "He is unbelievable!!!" Trump posted. Overnight, Trump's Tuesday order doubling tariffs on steel and aluminum imports to 50% came into effect, with only the UK spared the jump in duties on Wednesday. Meanwhile, Wednesday is deadline day for trading partners to make "best offers" for a deal to fend off "reciprocal" tariff hikes scheduled for July. Read more: The latest on Trump's tariffs Optimism for a US-China trade pact dimmed after Trump called President Xi "extremely hard to make a deal with" in a post to social media early Wednesday morning. The Geneva tariff truce between the two has appeared increasingly fragile amid clashes over issues such as chip exports, rare earth supplies, Taiwan, and visas. US stocks largely closed higher on Wednesday after another day of President Trump teasing out that negotiations with trading partners might not be going great. Going back to April, any kind of negative tariff headlines were weighing on the stock market significantly. But in recent sessions that hasn't been the case. Barcalys head of US equity strategy Venu Krishina told Yahoo Finance that the recent market action has been a part of the "broad realization" that the extreme levels of tariffs can't be taken at face value. Krishna and other strategists have also pointed out that the peak level of tariff uncertainty, which came when Trump jacked the effective US tariff rate to its highest level in more than a decade has already passed. Morgan Stanley chief investment officer Mike Wilson showed this by looking at how market volatility, as measured by the CBOE Volatility Index, or VIX, has moved lower in tandem with Bloomberg's US Trade Policy Uncertainty Index, which analyzes news articles for mentions of trade policy and uncertainty. "The bottom line is that while uncertainty remains high around the eventual tariff outcome, the rate of change on policy headwinds has become much less onerous." Wilson wrote. "This has reduced recession risk and is giving corporates and consumers more confidence in the forward looking outlook." Multiple economic data points have shown signs of slowing in the US economy during the month of May. On Wednesday, the Institute for Supply Management's Services PMI registered a reading of 49.9 in May, below the 51.6 seen in April. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. May's data marked just the fourth time the services sector has fallen into contraction in the past five years. Jefferies US economist Tom Simons wrote in a note to clients that the data likely reflect "more signs of a pause in activity rather than a steep contraction." "A broad pause is not a good thing, and the uncertainty that precipitated this pause has not shown any signs of lifting," Simons wrote. And it's not just one sector showing this either. On Monday, the ISM's Manufacturing PMI also showed contraction in May as imports hit their lowest level since 2009, as the wide swath of President Trump's tariffs took hold. Economists have reasoned that it's not just the tariffs themselves that cause businesses to slow activity. Rather, it's the uncertainty of where policy and, eventually, the broader economic environment are headed in 2025. In May, the private sector added 37,000 jobs, the lowest monthly total in more than two years, per ADP data. "When it comes to hiring, there's a hesitancy because of a wide level of uncertainty," ADP chief economist Nela Richardson told Yahoo Finance during a call with reporters. We detailed last week in the Yahoo Finance Morning Brief that GameStop (GME) is adopting the Strategy playbook and buying up bitcoin (BTC-USD). But as Yahoo Finance's Laura Bratton and David Hollerith reported today, it's far more than just GameStop adding bitcoin to their balance sheet. In all, 80 companies hold bitcoin as part of their treasury reserves and now hold roughly 3.4% of all bitcoins in circulation, according to Bernstein analyst Gautam Chhugani. While most of these companies aren't going full Strategy and making owning bitcoin their key investor pitch, this does feel like yet another sign of crypto becoming a further part of the mainstream investor conversation. Read more from Laura and David here. Yahoo Finance's Ben Werschkul reports: Read more here. Yahoo Finance's Laura Bratton reports: Read more here. Wall Street tech bull Dan Ives is putting his AI conviction to the test. On Wednesday, Wedbush Fund Advisers launched the Dan IVES Wedbush AI Revolution ETF, which will trade on the New York Stock Exchange under the ticker symbol IVES. The new exchange-traded fund is built on Ives's proprietary research and aims to provide investors with targeted exposure to the booming artificial intelligence sector. "The AI revolution is the biggest tech theme we've ever seen," Ives told Yahoo Finance in a phone interview following the announcement. "I've started [this] ETF because it's about the second, third, fourth derivatives of AI playing out, and that's the important thing for investors." The fund tracks 30 publicly traded companies handpicked from Ives's "AI Revolution Theme," a research framework that identifies firms with meaningful exposure to AI infrastructure, deployment, and monetization. The ETF spans a range of sectors, including semiconductors, hyperscalers, cybersecurity, consumer platforms, robotics, and cloud infrastructure. Holdings include major AI players like Nvidia (NVDA), tech giants such as Microsoft (MSFT), and defense-focused firms like Palantir (PLTR). Chinese companies Alibaba (BABA) and Baidu (BIDU) are also featured to capture exposure to AI developments in Asia. Reflecting on his investment approach, Ives explained, "I've never been too focused on valuations. It's about the themes, the best places, and the disruptors. That's all the work we do in the field." Read more here. The 10-year Treasury yield (^TNX) and the 30-year Treasury yield (^TYX) both fell about 8 basis points as investors digested a slew of weaker-than-expected economic data.. On Wednesday, data from ADP showed private payrolls grew by just 37,000 in May, far fewer than the 114,000 expected by economists and below the 60,000 new jobs added in April. This marked the smallest increase in private payrolls since March 2023. In another sign that tariff uncertainty is weighing on economic data, the Institute for Supply Management's Services PMI registered a reading of 49.9 in May, below the 51.6 seen in April and lower than the increase to 52 economists had expected. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. May's data marked just the fourth time the services sector has fallen into contraction in the past five years. Read more about the economic data releases from Wednesday morning here. Yahoo Finance's Pras Subramanian reports: Read more here. Activity in the services sector has fallen into contraction for the first time in a year. The Institute for Supply Management's Services PMI registered a reading of 49.9 in May, below the 51.6 seen in April and lower than the increase to 52 economists had expected. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. May's data marked just the fourth time the services sector has fallen into contraction in the past five years. New orders tumbled to a reading of 46.4 in May, below the 52.3 seen the month prior. Meanwhile, the prices paid index increased to 68.7, up from 65.1 in April. This marked the highest prices paid reading since November 2022, when the Consumer Price Index had shown inflation at 7.1%. Steve Miller, the chair of ISM's Services Business Survey, said in the release that "Tariff impacts are likely elevating prices paid." "May's PMI level is not indicative of a severe contraction, but rather uncertainty that is being expressed broadly among ISM Services Business Survey panelists," Miller said. "The average reading of 50.8 percent over the last three months still indicates expansion in that time period, but it is a notable shift of 2 percentage points below its average of 52.8 percent over the previous nine months." US stocks inched higher on Wednesday as Wall Street digested a sharp slowdown in private-sector hiring growth, with one eye on prospects for US-China trade talks as a steel tariff hike kicked in. The S&P 500 (^GSPC) rose about 0.2%, while the Dow Jones Industrial Average (^DJI) added over 0.1%. The tech-heavy Nasdaq Composite (^IXIC) gained more than 0.2% to build on the major indexes' strong start to the week. On Wednesday, data from ADP showed private payrolls grew by just 37,000 in May, far fewer than the 114,000 expected by economists and below the 60,000 new jobs added in April. This marked the smallest increase in private payrolls since March 2023. "The weak numbers we're seeing now does not point to a labor market that's collapsing, but there is hiring hesitancy," ADP chief economist Nela Richardson said on a call with reporters. President Trump posted about the numbers on Truth Social shortly after the release. "ADP NUMBER OUT!!! 'Too Late' Powell must now LOWER THE RATE," Trump posted. "He is unbelievable!!! Europe has lowered NINE TIMES!" Read more here. Nvidia (NVDA) stock advanced 0.5% in premarket trading, adding to its $1 trillion rally that saw it surpass Microsoft (MSFT) as the world's most valuable company by market capitalization. Nvidia's market cap stands at $3.444 trillion following a more than 50% rally in May, compared to Microsoft's valuation of $3.441 trillion. The stock has gained more than 4% since reporting first quarter earnings last week. Nvidia is scheduled to present at the BofA Securities Global Technology Conference on Wednesday, which could prompt additional moves. Read more here. Dollar Tree (DLTR) reported first quarter revenue and earnings today that beat analysts' expectations but said it sees a big hit to second quarter results due to tariffs. The company forecast adjusted profit to be down 45% to 50% from a year ago in the second quarter due to tariff volatility and price hikes. However, it expects profits to pick back up in the second part of the year. Dollar Tree's earnings report follows results from Dollar General (DG) yesterday that beat estimates and included an annual sales forecast raise. Dollar Tree maintained its annual sales outlook and raised its earnings per share outlook to a range of $5.15 to $5.65. Dollar Tree stock fell 0.5% in premarket trading on Wednesday after bouncing back and forth between positive and negative territory. Read more here. Earnings: ChargePoint (CHPT), Dollar Tree (DLTR), Five Below (FIVE), MongoDB (MDB) Economic data: MBA Mortgage Applications (week ending May 30); ADP employment change (May); S&P Global US services PMI (May final); S&P Global US Composite PMI (May final); ISM Services index (May); Federal Reserve Beige Book released Here are some of the biggest stories you may have missed overnight and early this morning: Apple bulls and bears don't see tariffs changing the story Trump calls Xi 'extremely hard to make a deal with' Michael Saylor's bitcoin imitators are multiplying fast Higher US metals tariffs kick in as deadline for 'best offers' arrives Tariffs are hammering an American indulgence — snacks Trump obscures Medicaid cuts in bid to pass massive tax bill Tesla's German sales fall 36% as slump builds Tesla's UK car sales drop over 45% in May, New AutoMotive early data shows When it comes to Apple stock both the bull and the bear cases are unfazed by tariffs, despite the fact these levies and presidential threats could deflate the company, bull and bear arguments tend to focus on the tech company's well established products and competitor advantage. Despite the political landscape changing for Apple CEO Tim Cook, for Wall Street the story remains the same. The bull case is focused on strong earnings, a legacy built on underpromising and overdelivering. Delivering stable results and always managing expectations. But this may be hard to see now. My colleague, Yahoo Finance's senior reporter Hamza Shaban looks at why Apple bull and bear cases don't see tariffs changing the story. Jets are taking center stage as countries vie for President Trump's attention — and China could be the latest, with a potential Airbus ( EADSY) deal. Chinese airlines are considering placing an order for as many as 500 Airbus planes to coincide with a visit by European leaders to Beijing in July, sources told Bloomberg. Deals for US rival Boeing's (BA) planes have emerged as the US's favored bargaining chip in trade discussions. The spotlight fell on the gambit after Trump's acceptance of a $400 million luxury Boeing jet from the Qatari royal family in May, for use in the Air Force One fleet. Though China's Airbus negotiations are said to be fluid and could fall through, the European jet maker's stock rose as much as 4% in Paris. Meanwhile, shares of Boeing hovered below the flat line. Bloomberg reports: Read more here. Dozens of publicly traded companies, a media firm controlled by President Trump's family, and meme stock poster child GameStop (GME) are all piling into a bet that Michael Saylor used to turn a business intelligence software firm into a bitcoin juggernaut called Strategy (MSTR). Yahoo Finance's David Hollerith and Laura Bratton report: Read more here. Here are some top stocks trending on Yahoo Finance in premarket trading: CrowdStrike (CRWD) stock fell over 6% before the bell on Wednesday after the technology company forecast Q2 earnings below estimates, indicating weaker government spending on cybersecurity products. HPE (HPE) beat Wall Street estimates for second-quarter revenue and profit on Tuesday, due to strong demand for its artificial-intelligence servers and hybrid products. The groups stock price was up 5% before the bell on Wednesday. Robinhood (HOOD) stock rose over 1% in premarket trading on Wednesday. Nearly four years after its much-hyped debut, Robinhood Markets Inc. has finally seen its shares hit a fresh record as cryptocurrency markets rally. Robinhood's stock rose over 5% on Tuesday and closed at $71.72, beating its previous high of $70.39, which was set days after the online brokerage's IPO. Wells Fargo (WFC) shares were up 3% before the bell today after the Federal Reserve a major restriction on the investment bank, meaning it will no longer have to operate under a $1.95T asset cap. Despite global unrest, trade war threats and persistently sluggish demand in China, investors are clamoring for a piece of the stock action in Hong Kong as valuations are still attractive. Bloomberg reports: Read more here. Stock in Toyota Industries (6201.T) sank over 12% late Tuesday after an attempt to take the company private failed to meet investor expectations. A ¥4.7 trillion ($33 billion) deal offered ¥16,300 yen per share, well below Tuesday's close of ¥18,400. Parent company Toyota Motor Corporation (TM) has been trying to take the forklifts, engines, and auto parts manufacturer Toyota Industries off the stock market under pressure from government regulators and investors to pull apart entwined company structures. Toyota's tender offer drew criticism as it "undermines" minority shareholders. According to Reuters, the offer values the buyout at $26 billion, with the remaining financing structured through loans and preferred share investments. If the deal goes through a new company will be established. Toyota Motor will invest around ¥700 billion in non-voting shares, while its real estate arm, Toyota Fudosan, will contribute ¥180 billion. Chairman Akio Toyoda plans a ¥1 billion personal investment. US stocks largely closed higher on Wednesday after another day of President Trump teasing out that negotiations with trading partners might not be going great. Going back to April, any kind of negative tariff headlines were weighing on the stock market significantly. But in recent sessions that hasn't been the case. Barcalys head of US equity strategy Venu Krishina told Yahoo Finance that the recent market action has been a part of the "broad realization" that the extreme levels of tariffs can't be taken at face value. Krishna and other strategists have also pointed out that the peak level of tariff uncertainty, which came when Trump jacked the effective US tariff rate to its highest level in more than a decade has already passed. Morgan Stanley chief investment officer Mike Wilson showed this by looking at how market volatility, as measured by the CBOE Volatility Index, or VIX, has moved lower in tandem with Bloomberg's US Trade Policy Uncertainty Index, which analyzes news articles for mentions of trade policy and uncertainty. "The bottom line is that while uncertainty remains high around the eventual tariff outcome, the rate of change on policy headwinds has become much less onerous." Wilson wrote. "This has reduced recession risk and is giving corporates and consumers more confidence in the forward looking outlook." Multiple economic data points have shown signs of slowing in the US economy during the month of May. On Wednesday, the Institute for Supply Management's Services PMI registered a reading of 49.9 in May, below the 51.6 seen in April. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. May's data marked just the fourth time the services sector has fallen into contraction in the past five years. Jefferies US economist Tom Simons wrote in a note to clients that the data likely reflect "more signs of a pause in activity rather than a steep contraction." "A broad pause is not a good thing, and the uncertainty that precipitated this pause has not shown any signs of lifting," Simons wrote. And it's not just one sector showing this either. On Monday, the ISM's Manufacturing PMI also showed contraction in May as imports hit their lowest level since 2009, as the wide swath of President Trump's tariffs took hold. Economists have reasoned that it's not just the tariffs themselves that cause businesses to slow activity. Rather, it's the uncertainty of where policy and, eventually, the broader economic environment are headed in 2025. In May, the private sector added 37,000 jobs, the lowest monthly total in more than two years, per ADP data. "When it comes to hiring, there's a hesitancy because of a wide level of uncertainty," ADP chief economist Nela Richardson told Yahoo Finance during a call with reporters. We detailed last week in the Yahoo Finance Morning Brief that GameStop (GME) is adopting the Strategy playbook and buying up bitcoin (BTC-USD). But as Yahoo Finance's Laura Bratton and David Hollerith reported today, it's far more than just GameStop adding bitcoin to their balance sheet. In all, 80 companies hold bitcoin as part of their treasury reserves and now hold roughly 3.4% of all bitcoins in circulation, according to Bernstein analyst Gautam Chhugani. While most of these companies aren't going full Strategy and making owning bitcoin their key investor pitch, this does feel like yet another sign of crypto becoming a further part of the mainstream investor conversation. Read more from Laura and David here. Yahoo Finance's Ben Werschkul reports: Read more here. Yahoo Finance's Laura Bratton reports: Read more here. Wall Street tech bull Dan Ives is putting his AI conviction to the test. On Wednesday, Wedbush Fund Advisers launched the Dan IVES Wedbush AI Revolution ETF, which will trade on the New York Stock Exchange under the ticker symbol IVES. The new exchange-traded fund is built on Ives's proprietary research and aims to provide investors with targeted exposure to the booming artificial intelligence sector. "The AI revolution is the biggest tech theme we've ever seen," Ives told Yahoo Finance in a phone interview following the announcement. "I've started [this] ETF because it's about the second, third, fourth derivatives of AI playing out, and that's the important thing for investors." The fund tracks 30 publicly traded companies handpicked from Ives's "AI Revolution Theme," a research framework that identifies firms with meaningful exposure to AI infrastructure, deployment, and monetization. The ETF spans a range of sectors, including semiconductors, hyperscalers, cybersecurity, consumer platforms, robotics, and cloud infrastructure. Holdings include major AI players like Nvidia (NVDA), tech giants such as Microsoft (MSFT), and defense-focused firms like Palantir (PLTR). Chinese companies Alibaba (BABA) and Baidu (BIDU) are also featured to capture exposure to AI developments in Asia. Reflecting on his investment approach, Ives explained, "I've never been too focused on valuations. It's about the themes, the best places, and the disruptors. That's all the work we do in the field." Read more here. The 10-year Treasury yield (^TNX) and the 30-year Treasury yield (^TYX) both fell about 8 basis points as investors digested a slew of weaker-than-expected economic data.. On Wednesday, data from ADP showed private payrolls grew by just 37,000 in May, far fewer than the 114,000 expected by economists and below the 60,000 new jobs added in April. This marked the smallest increase in private payrolls since March 2023. In another sign that tariff uncertainty is weighing on economic data, the Institute for Supply Management's Services PMI registered a reading of 49.9 in May, below the 51.6 seen in April and lower than the increase to 52 economists had expected. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. May's data marked just the fourth time the services sector has fallen into contraction in the past five years. Read more about the economic data releases from Wednesday morning here. Yahoo Finance's Pras Subramanian reports: Read more here. Activity in the services sector has fallen into contraction for the first time in a year. The Institute for Supply Management's Services PMI registered a reading of 49.9 in May, below the 51.6 seen in April and lower than the increase to 52 economists had expected. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. May's data marked just the fourth time the services sector has fallen into contraction in the past five years. New orders tumbled to a reading of 46.4 in May, below the 52.3 seen the month prior. Meanwhile, the prices paid index increased to 68.7, up from 65.1 in April. This marked the highest prices paid reading since November 2022, when the Consumer Price Index had shown inflation at 7.1%. Steve Miller, the chair of ISM's Services Business Survey, said in the release that "Tariff impacts are likely elevating prices paid." "May's PMI level is not indicative of a severe contraction, but rather uncertainty that is being expressed broadly among ISM Services Business Survey panelists," Miller said. "The average reading of 50.8 percent over the last three months still indicates expansion in that time period, but it is a notable shift of 2 percentage points below its average of 52.8 percent over the previous nine months." US stocks inched higher on Wednesday as Wall Street digested a sharp slowdown in private-sector hiring growth, with one eye on prospects for US-China trade talks as a steel tariff hike kicked in. The S&P 500 (^GSPC) rose about 0.2%, while the Dow Jones Industrial Average (^DJI) added over 0.1%. The tech-heavy Nasdaq Composite (^IXIC) gained more than 0.2% to build on the major indexes' strong start to the week. On Wednesday, data from ADP showed private payrolls grew by just 37,000 in May, far fewer than the 114,000 expected by economists and below the 60,000 new jobs added in April. This marked the smallest increase in private payrolls since March 2023. "The weak numbers we're seeing now does not point to a labor market that's collapsing, but there is hiring hesitancy," ADP chief economist Nela Richardson said on a call with reporters. President Trump posted about the numbers on Truth Social shortly after the release. "ADP NUMBER OUT!!! 'Too Late' Powell must now LOWER THE RATE," Trump posted. "He is unbelievable!!! Europe has lowered NINE TIMES!" Read more here. Nvidia (NVDA) stock advanced 0.5% in premarket trading, adding to its $1 trillion rally that saw it surpass Microsoft (MSFT) as the world's most valuable company by market capitalization. Nvidia's market cap stands at $3.444 trillion following a more than 50% rally in May, compared to Microsoft's valuation of $3.441 trillion. The stock has gained more than 4% since reporting first quarter earnings last week. Nvidia is scheduled to present at the BofA Securities Global Technology Conference on Wednesday, which could prompt additional moves. Read more here. Dollar Tree (DLTR) reported first quarter revenue and earnings today that beat analysts' expectations but said it sees a big hit to second quarter results due to tariffs. The company forecast adjusted profit to be down 45% to 50% from a year ago in the second quarter due to tariff volatility and price hikes. However, it expects profits to pick back up in the second part of the year. Dollar Tree's earnings report follows results from Dollar General (DG) yesterday that beat estimates and included an annual sales forecast raise. Dollar Tree maintained its annual sales outlook and raised its earnings per share outlook to a range of $5.15 to $5.65. Dollar Tree stock fell 0.5% in premarket trading on Wednesday after bouncing back and forth between positive and negative territory. Read more here. Earnings: ChargePoint (CHPT), Dollar Tree (DLTR), Five Below (FIVE), MongoDB (MDB) Economic data: MBA Mortgage Applications (week ending May 30); ADP employment change (May); S&P Global US services PMI (May final); S&P Global US Composite PMI (May final); ISM Services index (May); Federal Reserve Beige Book released Here are some of the biggest stories you may have missed overnight and early this morning: Apple bulls and bears don't see tariffs changing the story Trump calls Xi 'extremely hard to make a deal with' Michael Saylor's bitcoin imitators are multiplying fast Higher US metals tariffs kick in as deadline for 'best offers' arrives Tariffs are hammering an American indulgence — snacks Trump obscures Medicaid cuts in bid to pass massive tax bill Tesla's German sales fall 36% as slump builds Tesla's UK car sales drop over 45% in May, New AutoMotive early data shows When it comes to Apple stock both the bull and the bear cases are unfazed by tariffs, despite the fact these levies and presidential threats could deflate the company, bull and bear arguments tend to focus on the tech company's well established products and competitor advantage. Despite the political landscape changing for Apple CEO Tim Cook, for Wall Street the story remains the same. The bull case is focused on strong earnings, a legacy built on underpromising and overdelivering. Delivering stable results and always managing expectations. But this may be hard to see now. My colleague, Yahoo Finance's senior reporter Hamza Shaban looks at why Apple bull and bear cases don't see tariffs changing the story. Jets are taking center stage as countries vie for President Trump's attention — and China could be the latest, with a potential Airbus ( EADSY) deal. Chinese airlines are considering placing an order for as many as 500 Airbus planes to coincide with a visit by European leaders to Beijing in July, sources told Bloomberg. Deals for US rival Boeing's (BA) planes have emerged as the US's favored bargaining chip in trade discussions. The spotlight fell on the gambit after Trump's acceptance of a $400 million luxury Boeing jet from the Qatari royal family in May, for use in the Air Force One fleet. Though China's Airbus negotiations are said to be fluid and could fall through, the European jet maker's stock rose as much as 4% in Paris. Meanwhile, shares of Boeing hovered below the flat line. Bloomberg reports: Read more here. Dozens of publicly traded companies, a media firm controlled by President Trump's family, and meme stock poster child GameStop (GME) are all piling into a bet that Michael Saylor used to turn a business intelligence software firm into a bitcoin juggernaut called Strategy (MSTR). Yahoo Finance's David Hollerith and Laura Bratton report: Read more here. Here are some top stocks trending on Yahoo Finance in premarket trading: CrowdStrike (CRWD) stock fell over 6% before the bell on Wednesday after the technology company forecast Q2 earnings below estimates, indicating weaker government spending on cybersecurity products. HPE (HPE) beat Wall Street estimates for second-quarter revenue and profit on Tuesday, due to strong demand for its artificial-intelligence servers and hybrid products. The groups stock price was up 5% before the bell on Wednesday. Robinhood (HOOD) stock rose over 1% in premarket trading on Wednesday. Nearly four years after its much-hyped debut, Robinhood Markets Inc. has finally seen its shares hit a fresh record as cryptocurrency markets rally. Robinhood's stock rose over 5% on Tuesday and closed at $71.72, beating its previous high of $70.39, which was set days after the online brokerage's IPO. Wells Fargo (WFC) shares were up 3% before the bell today after the Federal Reserve a major restriction on the investment bank, meaning it will no longer have to operate under a $1.95T asset cap. Despite global unrest, trade war threats and persistently sluggish demand in China, investors are clamoring for a piece of the stock action in Hong Kong as valuations are still attractive. Bloomberg reports: Read more here. Stock in Toyota Industries (6201.T) sank over 12% late Tuesday after an attempt to take the company private failed to meet investor expectations. A ¥4.7 trillion ($33 billion) deal offered ¥16,300 yen per share, well below Tuesday's close of ¥18,400. Parent company Toyota Motor Corporation (TM) has been trying to take the forklifts, engines, and auto parts manufacturer Toyota Industries off the stock market under pressure from government regulators and investors to pull apart entwined company structures. Toyota's tender offer drew criticism as it "undermines" minority shareholders. According to Reuters, the offer values the buyout at $26 billion, with the remaining financing structured through loans and preferred share investments. If the deal goes through a new company will be established. Toyota Motor will invest around ¥700 billion in non-voting shares, while its real estate arm, Toyota Fudosan, will contribute ¥180 billion. Chairman Akio Toyoda plans a ¥1 billion personal investment. Sign in to access your portfolio
Miami Herald
an hour ago
- Miami Herald
Higher U.S. Tariffs on Steel and Aluminum Imports Take Effect
EDITORS NOTE: EDS: SUBS to expand and revise throughout; SUBS headline; ADDS Mega to contributor line; UPDATES list of related stories. NOTE: Story first moved today at 12:52 a.m. ET.); (ART ADV: With photo.); (With: U.S.-MANUFACTURING-OUTLOOK, TARIFFS-BRITAIN, CHINA-MINERALS-SMUGGLING); Ana Swanson reported from Washington, and Ian Austen from Ottawa, Ontario. Emiliano Rodríguez Mega contributed reporting. WASHINGTON -- U.S. tariffs on steel and aluminum imports doubled Wednesday, as President Donald Trump continued to ratchet up levies on foreign metals that he claims will help revitalize American steel mills and aluminum smelters. The White House called the increased tariffs, which rose to 50% from 25% just after midnight Eastern time, a matter of addressing "trade practices that undermine national security." They were announced during Trump's visit to a mill run by U.S. Steel last week, and appear to be aimed at currying favor with steelworkers and the steel industry, including those in swing states like Pennsylvania, where U.S. Steel is based. The higher levies have already rankled close allies that sell metal to the United States, including Canada, Mexico and Europe. They have also sent alarms to automakers, plane manufacturers, homebuilders, oil drillers and other companies that rely on buying metals. In an executive order, Trump said the higher tariffs would "more effectively counter foreign countries that continue to offload low-priced, excess steel and aluminum in the United States market and thereby undercut the competitiveness of the United States steel and aluminum industries." Kevin Dempsey, the president of the American Iron and Steel Institute, an industry group, praised the move. He said China and other countries oversupplied the international market, making it harder for U.S. producers to compete. "Given these challenging international conditions that show no signs of improvement, this tariff action will help prevent new surges in imports that would injure American steel producers and their workers," Dempsey said. But companies that use steel and aluminum to make their products criticized the tariffs, saying they would add costs for American consumers. Robert Budway, the president of the Can Manufacturers Institute, said doubling the steel tariff would further increase the cost of canned goods at the grocery store. "This cost is levied upon millions of American families relying on canned foods picked and packed by U.S. farmers and can makers," he said. The increase Wednesday is the latest in a mounting array of import taxes Trump has announced since returning to the Oval Office in January, including the 25% tariff on steel and aluminum in March. Taken together, the president's trade tactics have increased concerns of a global downturn and heightened corporate America's worries about the cost of doing business. Economists have pointed out that tariffs on factory inputs such as metals risk slowing U.S. manufacturing, since they raise prices for factories. By adding to the cost of making cars, drilling for oil and building data centers, higher steel tariffs could slow other goals of the Trump administration. An economic analysis published by the U.S. International Trade Commission, an independent, bipartisan government agency, suggested that while the steel and aluminum tariffs levied in Trump's first term helped American steel and aluminum producers, they hurt the broader economy by raising prices for many other industries, including automaking. U.S. unions and major companies like Cleveland-Cliffs and U.S. Steel, which have significant lobbying networks, have argued that tariffs are necessary to keep them in business. After struggling financially for years, U.S. Steel agreed in late 2023 to be acquired by Nippon Steel of Japan, though Trump will make the final call on whether the merger can go through. Foreign governments have bristled at the idea that their steel exports are a national security threat to the United States, in part because American demand for the metals far exceeds the country's current ability to produce them. Canada is the largest foreign supplier of both steel and aluminum to the United States. Mexico, Brazil, South Korea and Germany are major suppliers of steel, while the United Arab Emirates, China and South Korea provide the United States with small amounts of aluminum. On Wednesday, President Claudia Sheinbaum of Mexico called the increased tariffs an unjust order with no legal basis. She also warned that her country could react next week with its own measures. "We disagree with it, we don't think it's fair or sustainable because it makes everything more expensive," she said, adding that Mexican officials are set to meet with their U.S. counterparts to negotiate a deal. "If this is not achieved, then we will also be announcing some measures that we must necessarily take to protect and strengthen jobs. It's not a matter of revenge or retaliation." Mexico's steel trade with the United States has historically shown a deficit, meaning Mexico imports more steel than it exports. On Tuesday, Marcelo Ebrard, Mexico's economy minister, said the country would demand to be spared from the latest tariffs. Britain was granted an exemption from the steel and aluminum levies as part of a preliminary deal struck with the U.S. last month, and it remains to be seen if other countries receive similar treatment as part of trade deals. Canada, which is both the largest exporter of steel to the United States and the largest importer of American steel, followed the initial 25% tariff from Trump with a retaliatory tariff. But to allow manufacturers to adjust and find new sources of supply, it suspended the tariffs' start until October. Some Canadian steel manufacturers have said they believe overseas producers are now selling steel once intended for the U.S. market in Canada at unfairly low prices. Prime Minister Mark Carney said Wednesday that Canada would not respond immediately to the escalation. "We are in intensive discussions right now with the Americans on the trading relationship," he said, adding: "Those discussions are progressing." Unifor, Canada's largest private sector union, was among the groups that called for immediate retaliation Wednesday. They were joined by Doug Ford, the premier of Ontario, the province with the three largest Canadian steelmakers. "We can't sit back and let President Trump steamroll us," Ford told reporters in Toronto. "Every single day that it goes by gives uncertainty through the sectors, it adds additional cost on the steel. So we need to react immediately." Catherine Cobden, the president of the Canadian Steel Producers Association, a trade group, said in a statement that doubling the tariff on imported steel "essentially closes the U.S. market to our domestic industry." The previous 25% tariff on steel already had an effect on Canada's producers. The steel association estimates that since the tariff took effect in March, steel shipments to the United States from Canada have fallen 30%. "Steel tariffs at this level will create mass disruption and negative consequences across our highly integrated steel supply chains and customers on both sides of the border," Cobden said. The Aluminium Association of Canada said in a statement Tuesday that the expanded tariff "makes Canadian exports to the U.S. economically unviable" and that "the industry may be forced to diversify trade toward the European Union." Electricity accounts for about 40% of the cost of smelting aluminum, and the trade group estimated that replacing Canadian aluminum with American production would require the expansion of U.S. power generation equivalent to four Hoover Dams. "The Canadian industry supports the U.S. goal of increasing domestic aluminum production capacity from 50% to 80%," the group said. "Punitive tariffs do not create the certainty needed for long-term, capital-intensive investments. Even with higher domestic output, the U.S. will continue to rely on substantial aluminum imports." Industry analysts have said the U.S. tariffs have not significantly curbed shipments from Canadian aluminum mills. The U.S. aluminum industry is too small to significantly replace imports from Canada without expansion and investment. Century Aluminum, a U.S. aluminum maker, said last year that it would build the first new aluminum smelter in the United States in half a century, doubling domestic production. But the United States would remain dependent on imports for most of its aluminum. This article originally appeared in The New York Times. Copyright 2025
