US sanctions Russia-based network for helping Yemen's Houthis
WASHINGTON, April 2 (Reuters) - The United States imposed sanctions on Wednesday on Russia-based people and entities working to help procure weapons and commodities - including stolen Ukrainian grain - for Yemen's Iran-backed Houthis, the Treasury Department said.
The operatives, who included Russia-based Afghan businessman Hushang Ghairat and his brother, Russia-based Afghan businessman Sohrab Ghairat, helped senior Houthi official Sa'id al-Jamal, procure millions of dollars' worth of commodities from Russia for shipment to Houthi-controlled Yemen, Treasury said.
The goods included weapons and sensitive goods, as well as stolen Ukrainian grain, the department said in a statement.
"The Houthis remain reliant on Sa'id al-Jamal and his network to procure critical goods to supply the group's terrorist war machine,' said Treasury Secretary Scott Bessent. 'Today's action underscores our commitment to degrading the Houthis' ability to threaten the region through their destabilizing activities.'
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Reuters
6 minutes ago
- Reuters
US immigration raid of Omaha meat plant cuts staff, fuels food production worries
CHICAGO, June 11 (Reuters) - U.S. meat producer Glenn Valley Foods was operating an Omaha, Nebraska, facility with about 30% of its staff on Wednesday after federal agents detained workers in an immigration raid the previous day, slashing the output of products it sells to grocery stores and restaurants, the company's president said. In the wake of Tuesday's sweep by U.S. Immigration and Customs Enforcement agents, livestock traders and market analysts expressed concerns that the potential deportation of undocumented workers from such raids could disrupt U.S. food production at a time when beef prices have soared and meat processors report a labor shortage. ICE agents detained about 74 to 76 workers out of roughly 140 at the Glenn Valley Foods plant, President Chad Hartmann said. Other workers did not show up on Wednesday because they felt afraid or traumatized, he said, adding that the facility's production dropped to about 20% of normal. Glenn Valley Foods sells steak, chicken and corned beef products to restaurants and grocery stores, according to its website. Retail beef prices have set records as the size of the U.S. cattle herd has declined to its lowest level in 70 years after a years-long drought raised feed costs. Consumer demand for steaks and hamburgers has stayed strong nevertheless. Glenn Valley Foods is trying to determine how long it will take to hire new employees, Hartmann said. "The hole that got punched into our business is staffing," he said. Livestock traders worried that immigration raids could slow meat companies' demand to buy cattle from farmers to process into beef, if the companies do not have enough workers. Chicago Mercantile Exchange cattle futures came under pressure on Tuesday during the raid, after recently hitting records. "There's certainly going to be nervousness out there on where the labor situation goes, going forward," said Matt Wiegand, a commodity broker for risk management firm FuturesOne in Nebraska. Meatpackers still face an acute worker shortage, said Julie Anna Potts, president of the Meat Institute industry group. It worsened during the COVID-19 pandemic, when major companies such as Tyson Foods (TSN.N), opens new tab temporarily shut plants because of a lack of workers. Glenn Valley used E-Verify, a federal database used for checking employees' immigration status. Hartmann said Homeland Security told him on Wednesday that there was no better system. "We will have to continue to use it," he said. ICE said a criminal investigation was ongoing into what immigration officials called a large-scale employment of immigrants who are present in the U.S. illegally. Footage, opens new tab of the Glenn Valley raid released by ICE showed agents searching the plant, restraining workers' hands and ankles, and taking them into custody. ICE officers have been intensifying efforts in recent weeks to deliver on U.S. President Donald Trump's agenda of record-level deportations. Tensions boiled over in Los Angeles over the weekend when protesters took to the streets after ICE arrested migrants at Home Depot stores, a garment factory and a warehouse, according to rights advocates. On Tuesday night, demonstrators marched in New York, Atlanta and Chicago. More than half of all meatpacking workers in the U.S. are immigrants, according to the Center for Economic and Policy Research, a think tank. The Omaha World-Herald newspaper said on Tuesday that raids were also reported at local plants run by large meatpackers Tyson and JBS USA ( Tyson and JBS told Reuters their facilities were not raided.
Reuters
22 minutes ago
- Reuters
TRADING DAY Good vibrations turn sour
ORLANDO, Florida, June 11 (Reuters) - TRADING DAY Making sense of the forces driving global markets By Jamie McGeever, Markets Columnist I'm excited to announce that I'm now part of Reuters Open Interest (ROI), an essential new source for data-driven, expert commentary on market and economic trends. You can find ROI on the Reuters website, and you can follow us on LinkedIn and X. The US and China have reached a trade deal, or at least agreed on the framework of a deal, which together with surprisingly soft U.S. inflation data, gave markets a lift on Wednesday. But Wall Street's gains were mild, and they were later wiped out by rising tensions in the Middle East. In my column today I look at the 'equity risk premium' and other metrics that suggest relative U.S. equity and bond valuations are getting very stretched. 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 Good vibrations turn sour It's a "done" deal, according to U.S. President Donald Trump, although the he and Chinese leader Xi Jinping still have to finalize the wording of the trade agreement between the two superpowers and sign off on it. The main points of the deal appear to be: China will remove export restrictions on rare earth minerals and other key industrial components; U.S. tariffs on Chinese goods will total 55%; Chinese tariffs on U.S. goods will total 10%. Trump could not have been more enthusiastic in his praise for the agreement on Wednesday, and Commerce Secretary Howard Lutnick said 'deal after deal' with other countries will follow in the weeks ahead. Yet, judging by the relatively muted market reaction, investors are less enthused. And given the chaotic and unpredictable nature of the Trump administration's tariff announcements thus far, the irony of Treasury Secretary Scott Bessent calling on China to be a "reliable partner" in trade negotiations will not be lost on some observers. Especially, one suspects, in Beijing. Based on these proposed China levies, and with the US expected to conclude more trade deals in the coming weeks, the overall U.S. effective tariff rate will be lower than feared a couple of months ago. That's a relief. But the effective tariff rate of around 15% that many economists expect will still be significantly higher than the 2.5% rate at the end of last year, and would be the highest since the 1930s. Also, as the May inflation figures showed, tariffs have yet to be felt on prices. Investors - and Fed policymakers, who meet next week - are in a state of limbo. How will corporate profits and consumer spending be affected? What proportion of the tariffs will companies "swallow", and how much will they pass on to their customers? Zooming out, inflation appears to be cooling around the world, although this trend is expected to reverse once tariffs start to fuel higher goods price inflation. Figures on Wednesday showed that U.S. consumer inflation and Japanese wholesale inflation were lower than expected in May. These reports follow similar numbers from Europe recently, and China remains stuck in its battle against deflation. Next up is India, which releases consumer inflation figures on Thursday, which are expected to show annual inflation slowed to 3.0% in May, the lowest in more than six years. Another focus for investors on Thursday will be the auction of 30-year U.S. Treasury bonds. US stocks-bonds warnings flash amber again Calm has descended on U.S. markets following the 'Liberation Day' tariff turmoil of early April. But Wall Street's rally has revived questions about U.S. equity valuations, as stocks once again look super pricey compared to bonds. Since the chaotic days of early April, U.S. equities have rebounded fiercely, with the S&P 500 up 25%, putting the Shiller cyclically adjusted price-earnings (CAPE) ratio for the index in the 94th percentile going back to the 1950s, according to bond giant PIMCO. Stocks are looking expensive in absolute terms, and in relation to bonds. The equity risk premium (ERP), the difference between equity yields and bond yields, is near historically low levels. According to analysts at PIMCO, the ERP is now zero. The previous two times it fell to zero or below were in 1987 and 1996–2001. In both instances, the ultra-low ERP precipitated a steep equity drawdown and sharp fall in long-dated bond yields. "The U.S. equity risk premium ... is exceptionally low by historical standards," they wrote in their five-year outlook on Tuesday. "A mean reversion to a higher equity risk premium typically involves a bond rally, an equity sell-off, or both." But reversion to the mean doesn't just happen by magic. A catalyst is needed. Equities have recovered largely because they were oversold in April, trade tensions have been dialed down, and investors remain confident that Big Tech will drive solid AI-led earnings growth. So even though huge economic, trade, and policy risks continue to hang over markets, there is no sign of an imminent catalyst that would cause an equity market selloff. The flip side of equities looking expensive is that bonds look like a bargain. Indeed, the relative divergence between stocks and bonds is such that, by one measure, U.S. fixed income assets are the cheapest relative to equities in over half a century. Using national flow of funds data from the Federal Reserve, retired strategist Jim Paulsen calculates that the total market value of U.S. bonds as a percentage share of the total market value of U.S. equities is the lowest since the early 1970s. "Since the aggregate U.S. portfolio is currently aggressively positioned, investors may have far more capacity and desire to boost bond holdings in the coming years than most appreciate," Paulsen wrote last week. But bonds are 'cheap' for a reason. Washington's profligacy – the reason ratings agency Moody's recently stripped the U.S. of its triple-A credit rating – and inflation worries have kept yields stubbornly high. The term premium - the risk premium investors demand for holding long-term debt rather than rolling over short-dated loans - is the highest in over a decade, reflecting concerns about Uncle Sam's long-term fiscal health. And the diagnosis here shows no signs of improving. Trump's 'Big Beautiful Bill' is expected to add $2.4 trillion to the U.S. debt over the next decade, according to the nonpartisan Congressional Budget Office, likely putting more upward pressure on yields. Of course, equity investors do seem to be pricing in a very rosy scenario, and the past few months have shown how quickly the market landscape can change. The U.S. economy could weaken more than expected, the trade war could escalate, or there could be a geopolitical surprise that causes bond yields and equity prices to fall. Investors should therefore be mindful of the warnings being sent by ERPs and other absolute and relative valuation metrics. However, they should also remember that stretched valuations can get even more stretched. As the famous saying goes, markets can stay irrational longer than investors can remain solvent. What could move markets tomorrow? 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 lawmakers to attend Paris Airshow amid tariff, national security concerns
WASHINGTON, June 11 (Reuters) - More than two dozen U.S. lawmakers are set to attend the Paris Airshow next week amid rising concerns about potential American aerospace tariffs and national security issues, lawmakers told Reuters. Senators Jerry Moran and Jeanne Shaheen will lead a previously unreported bipartisan delegation of 11 U.S. senators, including Senate Armed Services Committee Chair Roger Wicker, as well as about a dozen U.S. governors and more than a dozen House lawmakers led by Representative Sam Graves, who heads the House Transportation Committee. "As China continues to exert its aggression on democratic countries and Russia prolongs its unjust war in Ukraine, the U.S. must partner with our allies to bolster our national security and promote economic partnerships," said Moran, the Republican senator who chairs a Senate aviation subcommittee. Airbus ( opens new tab and Boeing (BA.N), opens new tab are both boosting U.S. investments. Virginia Governor Glenn Youngkin and Arkansas Governor Sarah Huckabee Sanders are among the state officials attending as they make the case for aerospace companies to boost U.S. investments. The push comes as global aerospace companies and U.S. airlines have warned new tariffs on imported commercial aircraft, jet engines and parts could put air safety and the supply chain at risk or trigger other unintended consequences like higher ticket prices. "Unfortunately, our manufacturers are experiencing severe disruptions as a result of this administration's tariffs and our allies are questioning our commitment to mutual defense," Shaheen said, adding "it's especially important for this bipartisan delegation to reaffirm that America remains a reliable, stable partner and that our capabilities remain unmatched – and that's exactly what we intend to do." Transportation Secretary Sean Duffy and Acting FAA Administrator Chris Rocheleau are also attending the show. The industry already faces 10% tariffs on nearly all imported planes and parts after U.S. President Donald Trump announced sweeping duties on trade partners in April. Last month, the Commerce Department opened an investigation known as Section 232 looking at risks to U.S. national security from imported goods, which could be used as a basis for even higher tariffs on imported planes, engines and parts. Airlines and manufacturers have been lobbying Trump to restore a tariff-free regime under the 1979 Civil Aircraft Agreement, in which the U.S. sector enjoyed a $75 billion annual trade surplus. According to the agreement, parts must be certified by the Federal Aviation Administration to be deemed tariff-free.
