UK House Prices Head For Yet Another Flat Year
I don't always pay a huge amount of attention to the Rightmove index of UK house prices.
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Yahoo
22 minutes ago
- Yahoo
Trading Day: Wall St momentum calms tariff shakes
By Jamie McGeever ORLANDO, Florida (Reuters) -TRADING DAY Making sense of the forces driving global markets By Jamie McGeever, Markets Columnist Wall Street rallied on Wednesday as investors continued to take their cue from earnings and AI-related optimism over tariffs, while a weak 10-year Treasury note auction served as a reminder of the precarious U.S. fiscal situation. More on that below. In my column today I look at how investors' apparent readiness to accept tariffs challenges the orthodoxies that have underpinned economic liberalism and world markets for the past 40 years. 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. 1. Trump imposes additional 25% tariff on Indian goods,relations hit new low 2. India-U.S. spat over trade and oil threatens widerfallout 3. Lula rejects 'humiliation' of calling Trump overU.S.-Brazil tariff 4. Biden-era appointees could stymie Trump's effort toreshape Fed 5. Bank of England's long unwinding road: Mike Dolan Today's Key Market Moves * FX: Dollar index falls 0.5%, its fourth straightdecline. Brazil's real rises 0.8% to a one-month high of 5.45/$. * STOCKS: Nasdaq climbs 1.2%, the best performing majorindex on Wall St. * SHARES/SECTORS: U.S. consumer discretionary index +2.5%,consumer staples index +1.8%. Apple +5%, Super Micro Computer-18%. * BONDS: A weak 10-year Treasury auction pusheslonger-dated yields up as much as 5 bps, steepening the curve. * COMMODITIES: Oil falls for a fifth day, hits newfive-week lows after U.S. Secretary of State Marco Rubiosuggests there may be an announcement on potential sanctionsagainst Russia. Wall St momentum calms tariff shakes Positive investor sentiment and risk appetite were on full display on Wednesday, as optimism around corporate earnings and the U.S. tech boom again overshadowed more worrisome global developments on tariffs and growth. Traders cheered news that ChatGPT maker OpenAI is mulling a stock sale that could value the company at $500 billion and Apple's pledge to spend $100 billion on U.S. manufacturing. U.S. earnings continue to surprise to the upside too, and the S&P 500 consumer discretionary index rose 2.4%, its best day since May. Wall Street stood in contrast to a more subdued global session. Benchmark Asian, emerging and European indices were all flat on Wednesday, with the Trump administration's tariffs weighing on sentiment across the board. The major exception was China, where blue chip stocks closed at their highest in more than three and a half years on hopes that the United States and China will strike a trade deal in the coming days. Trade-related optimism elsewhere, however, is in much shorter supply. U.S. President Donald Trump on Wednesday slapped further import duties on India, bringing the total tariff rate to 50%, while Brazil's President Luiz Inacio Lula da Silva told Reuters that relations with the U.S. are at a 200-year low. Some Fed officials, meanwhile, are signaling growing unease about the U.S. labor market and economy. Minneapolis Fed President Neel Kashkari and San Francisco Fed President Mary Daly on Wednesday said interest rates should probably be lowered in the coming months. In bonds, a weak $42 billion sale of 10-year U.S. government bonds drew the weakest demand in a year, and followed a somewhat disappointing auction of $58 billion three-year notes the day before. Thursday's $25 billion sale of 30-year bonds will come under even greater scrutiny. Also on Thursday, the Bank of England is widely expected to cut its key interest rate to 4% from 4.25%. But the challenges facing the Bank are significant - the fiscal outlook appears to be deteriorating sharply, and inflation is close to double the central bank's 2% target. Before that China announces July trade data, with economists expecting export growth to slow and the surplus to narrow. Earlier this week, official U.S. figures showed that the U.S. trade gap with China in June shrank to its lowest in more than 21 years. Markets' tariff resilience challenges long-standing economic orthodoxy Investors have been living in a real-time economic experiment ever since U.S. President Donald Trump returned to the White House in January. Whether it's tariffs, "America First" isolationism, overt politicization of independent economic institutions, or upended global economic norms, markets are having to deal with challenges few investors have faced before. So how are they reacting to the leader of the free world ripping up the economic playbook that has shaped the global financial system for 40 years? Wall Street and world stocks are at record highs, U.S. high yield corporate bond spreads are the tightest since before the 2007-08 global financial crisis, and Treasuries are remarkably calm, with the 10-year yield below its average of the last two years. It's not all serene, of course. The U.S. "term premium" - a measure of the extra compensation investors demand for holding long-dated Treasuries over short-term debt - is the highest in over a decade. Inflation expectations and long-dated yields have shot up too. And one needs to acknowledge that the full impact of Trump's tariffs has yet to be fully felt. But, at this point there has been no U.S. recession, even if growth is slowing. And the market plunge on the back of Trump's April 2 "Liberation Day" tariff debacle lasted a few weeks. The powerful stock market recovery since then suggests investors were less bothered by the actual tariffs than the shock of the initial announcement, the chaotic way it was delivered, and the amateurish way the levies were calculated. This outcome is not what economic textbooks would have predicted. ONE FOR YOU, 19 FOR ME Tariffs are a tax. And the overall U.S. average effective tariff rate looks likely to be around 18%, according to the Budget Lab at Yale. That's down from an estimated 28% in May but still nearly eight times higher than the level in December. Who will ultimately pay this tax is up for debate, but if sustained at that level, the president of the United States will have effectively imposed a tax hike worth around 1.8% of GDP, one of the largest in U.S. history. But wait. Aren't higher taxes bad for business, markets and growth? Don't higher taxes sap consumers' spending power, stunt investment and hiring, and crush the private sector's entrepreneurial spirit? Markets' relatively speedy acceptance raises the question: What happened to the last 40 years of economic orthodoxy, symbolized by the so-called "Washington Consensus"? This was the set of principles drawn up in the late 1980s that broadly mirrored the views of the Washington-based International Monetary Fund, World Bank and U.S. Treasury, ostensibly to help direct policy in Latin America but which ultimately served as the economic framework for Western liberal democracies and global markets. They included support for privatization, deregulation, the free flow of capital, fiscal discipline, and lower taxes. They also entailed lower barriers to trade, a cornerstone of globalization. For years these tenets were regarded by policymakers, business leaders and investors as sacrosanct. Some, like rigid adherence to tight fiscal policy, were put to the test - and shown to be flimsy, at best - during the GFC and pandemic. So now that the tariff line has been crossed, what about other economic commandments? Could governments look to raise tax revenue from other sources, such as wealth taxes on the super rich, a "Tobin tax" on foreign exchange transactions, or other "soft" capital controls? These are obviously anathema to the doctrine of free market capitalism. But then so were tariffs. To be fair, we are just entering this new era. And as my colleague Mike Dolan observed earlier this week, even if tariffs don't send the economy or markets into a tailspin, they may still lead to a "slow burn," with many years of lost economic potential, elevated volatility and lower investment returns. But investors aren't looking that far ahead. What they see right now is a pretty resilient U.S. economy, solid earnings growth, and red-hot optimism around U.S. tech and AI. And some of the old orthodoxies may be in the rear-view mirror. What could move markets tomorrow? * Australia trade (June) * Japan earnings, including Softbank, Sony, Toyota * China trade (June) * China FX reserves (June) * Bank of England interest rate decision * Germany trade (June) * Germany industrial production (June) * U.S. weekly jobless claims * U.S. Treasury auctions $25 bln of 30-year bonds * U.S. earnings including Eli Lilly, ConocoPhillips, GileadSciences, Motorola * Atlanta Fed President Raphael Bostic speaks 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, is committed to integrity, independence, and freedom from bias. (By Jamie McGeever; Editing by Nia Williams) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
- Yahoo
Trump claims Japan to import F-150s amid US tariff deal uncertainty
US President Donald Trump has reportedly said that Japan is set to begin importing Ford's F-150 pickup trucks, signalling a potential misunderstanding between the two nations regarding the specifics of a trade agreement proclaimed last month, according to Bloomberg. Tokyo's chief negotiator, Ryosei Akazawa, embarked on a trip to Washington with the intention of urging the Trump administration to honour its commitment to lower tariffs on automobiles and auto parts to 15% from the current 27.5%. Akazawa told reporters, 'It's worth noting that the US-UK agreement took 54 days to be implemented,' when discussing the anticipated reduction in auto tariffs upon his arrival in Washington. Speaking of Japan in a phone interview broadcast by CNBC, Trump stated: 'They're taking our cars. They're taking the very beautiful Ford F-150, which does very well. And I'm sure we'll do very well there and other things that do very well here, will also do well there.' The trade deal between the nations has been shrouded in uncertainty, raising concerns in Japan about its execution, especially concerning autos. The Trump administration's narrative on trade agreements has frequently been at odds with that of its trade partners, leading to questions about the agreements' effectiveness. Currently, the US imposes a 27.5% tariff on Japanese autos, a figure that combines an earlier 2.5% rate with a new 25% introduced by Trump. Although a reduction to 15% would alleviate some pressure, this rate would still affect the sector that is central to the Japanese economy. Optimism in Asian markets was evident as Akazawa made his ninth visit to the US, with Japan's Topix Index climbing 1%, buoyed by gains from automakers such as Toyota Motor. A point of contention remains whether the proposed 15% tariff will be an additional charge on top of current tariffs or if all current levies will be standardised to 15%, marking another potential area of misunderstanding between the two countries' interpretations of the trade deal. Despite Akazawa's assertion that tariffs will be capped at 15% and not added to existing rates, a recent executive order suggested that the 15% reduction would only apply to the European Union, not to Japan. Trump has often expressed frustration over the lack of popularity of US cars in Japan, but many experts believe this is due to the absence of models suited to the Japanese market, rather than trade barriers. The Ford F-150 mentioned by Trump may limit its practicality on Japan's narrower roads, where many are less than four metres wide for two lanes, as per government data from 2012. In the CNBC interview, Trump likened the $550bn investment package agreed upon with Japan in the trade deal to a "signing bonus". However, the Japanese have clarified that only a small fraction of this amount will constitute actual investment, with the remainder being loans and loan guarantees. Japan's Prime Minister Shigeru Ishiba has stated that these investments, driven by private companies, will serve the interests of both countries. "Trump claims Japan to import F-150s amid US tariff deal uncertainty – report" was originally created and published by Just Auto, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
Yahoo
an hour ago
- Yahoo
Liverpool set to bank €100m for star forward
Liverpool always try to get the best deal they can and Richard Hughes is a tough negotiator. Arne Slot has told us in the past about how strategic Liverpool were in their pursuit of him to become their new head coach and all of the right questions were asked to tempt the Dutchman to move. Shop the LFC Store 🚨2025/26 LFC x adidas range🚨 LFC x adidas Shop the home range today! LFC x adidas Shop the goalkeeper range today LFC x adidas Shop the new adidas range today! When it comes to bringing in players, Slot is now one of the main negotiators, showcasing his project for the club and giving players a clear idea of what their involvement would be to bring success. 🔴 Shop the LFC 2025/26 adidas away range In terms of player sales, however, Hughes is still heavily involved and tiny little details in agreements such as sell-on clauses and buy-back clauses are massive for us to keep the upper hand in deals. Luis Diaz to Bayern was a better deal than we thought The Colombian's departure to Bayern Munich was polarising for some fans, given how important he was to the team last season and in general his 22 goal contributions were a reasonable return. But since he was 28 years old and nearing the end of his contract, with Liverpool unwilling to offer him a new deal, the opportunity to sell was not something the Reds could turn down, especially not for the £65m (€75m) package that the Germans offered. It's was an extraordinary deal to agree. Cody Gakpo and up and coming talent Rio Ngumoha will be able to lock-down the left-hand side of the attack this season in his absence and the club's net transfer spend fell massively as a result. Furthermore, new signing Hugo Ekitike has also proved that he can play on the left-wing occasionally, although his main role will be playing as a striker, potentially alongside Alexander Isak.
