Thought Markets Were Volatile Already? Watch Out.
It has been a Jekyll-and-Hyde start to 2025. Analysts and investors are bracing for more drama in the second half.
S&P 500 futures point to a weak opening on Tuesday, but the benchmark index is on a winning streak, having closed on Monday at another record. But the dollar has had its worst start to the year in more than a half-century as some investors sweat a possible return of the 'sell America' trade instigated by President Trump's trade war.
Amid this split screen, Trump has stepped up his attacks on the Fed and its chair, Jay Powell. The threat to the central bank's independence could jolt global investors' nerves.
A recap: Coming into the year, Wall Street hoped that Trump's business-friendly agenda of slashing taxes and regulations would propel stocks.
But while the S&P 500 is up more than 5 percent this year, tariff uncertainty has rattled business executives, consumers and investors. And the fate of the Republican policy bill that is central to Trump's domestic agenda remains unclear as the legislation awaits a vote in Congress.
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18 minutes ago
Republican budget bill dismantles climate law passed by Democrats
WASHINGTON -- The sprawling Republican budget bill approved by the Senate Tuesday removes a proposed tax on solar and wind energy projects but quickly phases out tax credits for wind, solar and other renewable energy. The Senate approved the bill 51-50 as President Donald Trump and GOP lawmakers move to dismantle the 2022 climate law passed by Democrats under former President Joe Biden. Vice President JD Vance broke a tie after three Republican senators voted no. The bill now moves to the House for final legislative approval. The excise tax on solar and wind generation projects was added to the Senate bill over the weekend, prompting bipartisan pushback from lawmakers as well as clean energy developers and advocates. The final bill removes the tax but mostly sticks with legislative language released late Friday night and would end incentives for clean energy sooner than a draft version unveiled two weeks ago. Democrats and environmental groups said the GOP plan would crush growth in the wind and solar industry and lead to a spike in Americans' utility bills. The measure jeopardizes hundreds of renewable energy projects slated to boost the nation's electric grid, they said. 'Despite limited improvements, this legislation undermines the very foundation of America's manufacturing comeback and global energy leadership,' said Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association. If the bill becomes law, 'families will face higher electric bills, factories will shut down, Americans will lose their jobs, and our electric grid will grow weaker,'' she said. The American Petroleum Institute, the top lobbying group for the oil and gas industry, applauded the bill's passage. 'This historic legislation will help usher in a new era of energy dominance by unlocking opportunities for investment, opening lease sales and expanding access to oil and natural gas development,'' said Mike Sommers, the group's president and CEO. While Democrats complained that the bill would make it harder to get renewable energy to the electric grid, Republicans said the measure represents historic savings for taxpayers and supports production of traditional energy sources such as oil, natural gas and coal, as well as nuclear power, increasing reliability. In a compromise approved overnight, the bill allows wind and solar projects that begin construction within a year of the law's enactment to get a full tax credit without a deadline for when the projects are 'placed in service,'' or plugged into the grid. Wind and solar projects that begin later must be placed in service by the end of 2027 to get a credit. The bill retains incentives for technologies such as advanced nuclear, geothermal and hydropower through 2032. Changes to the renewable energy language — including removal of the excise tax on wind and solar — were negotiated by a group of Republican senators, including Alaska Sen. Lisa Murkowski and Iowa Sens. Joni Ernst and Chuck Grassley. Iowa is a top producer of wind power, while Murkowski is a longtime supporter of renewable energy as crucial for achieving energy independence, particularly for isolated rural communities in Alaska. Murkowski, who voted in favor of the final bill, called her decision-making process 'agonizing.' Changes that push back the timeline for terminating wind and solar credits mean that 'a good number' of Alaska projects would still qualify, she said. 'Again, it's not all we wanted. It could have been worse,' she told reporters Tuesday. Murkowski praised provisions calling for more oil lease sales in the Arctic National Wildlife Refuge and other areas in Alaska and increased revenue sharing. Rhode Island Sen. Sheldon Whitehouse, the top Democrat on the Senate Environment and Public Works Committee, called the bill a 'massively destructive piece of legislation' that 'increases costs for everyone by walloping the health care system, making families go hungry and sending utility bills through the roof.' The bill 'saddles our children and grandchildren with trillions and trillions of dollars in debt — all to serve giant corporations, fossil fuel polluters and billionaire Republican megadonors who are already among the richest people on the planet,' Whitehouse said. Wyoming Sen. John Barrasso, the No. 2 Senate Republican, hailed the bill for rescinding many elements of what he called the Biden administration's 'green new scam,' including electric vehicle tax credits that have allowed car owners to lower the purchase price of EVs by $7,500. The bill also blocks for 10 years a first-ever fee on excess methane emissions from oil and gas production. Industry groups fiercely opposed the methane fee, which was authorized by Democrats in the 2022 climate law but never implemented. The GOP bill also increases oil and gas leases on public lands and revives coal leasing in Wyoming and other states. 'Today, the Senate moved President Trump's agenda forward,'' said West Virginia Sen. Shelley Moore Capito, a Republican who chairs the Senate environment committee. Clean energy advocates were deeply disappointed by the bill, which they argue undoes much of the climate law before it fully takes effect. 'By eliminating a number of clean energy incentives and slashing others, this bill represents a significant step backward for America's energy future,' said Nathaniel Keohane, president of the Center for Climate and Energy Solutions, a nonprofit that seeks to accelerate the global transition to net-zero greenhouse gas emissions. 'Curtailing incentives for electricity generated from wind and solar power is particularly shortsighted'' and will raise energy prices for households and businesses and threaten reliability of the electric grid, Keohane said.
18 minutes ago
Florida cooperation with immigration enforcement sparks fears people will disappear into jails
MIAMI -- As Florida law enforcement agencies work with federal immigration officials, family members and immigrants' rights advocates worry that people will disappear into county jail systems despite the state's expansive public record laws. Miami-Dade officials said during a Thursday commission meeting that they are committed to transparency and will continue to follow state laws regarding the release of information about inmates. But one section of an agreement with U.S. Immigration and Customs Enforcement designates all records and information created under the agreement as federal records, and some observers say ICE would have the final say on what information is made public, including whether a person is even in custody. That could be a huge problem, said William Mann, an attorney with the Community Justice Project. 'I think the concerns that many folks have would be that they (county officials) would use this language that's in this basic ordering agreement ... to prevent loved ones, family members, friends, advocates and journalists from accessing information,' Mann said. 'Meaning that they would disappear into the Miami-Dade system if they were technically an ICE prisoner.' Tricia McLaughlin, the assistant secretary of ICE, told the Associated Press via email that any allegations that detainees do not have due process are false. 'Further, all detainees are provided ample opportunity to communicate with their attorneys and family members,' McLaughlin said. She said the easiest way to locate someone in custody is through the ICE detainee locator. Under Republican Gov. Ron DeSantis, local and state officials must take a much more aggressive role in supporting federal immigration enforcement, which has ramped up since President Donald Trump's return to office in January. A law 2022 law expanded the state's ban on so-called sanctuary policies and required agencies that operate county detention facilities to enter into agreements with ICE that empower local officers to identify and process 'removable aliens' in their jails. Another measure signed into law this year requires officials responsible for overseeing local or state law enforcement to use their 'best efforts' to support federal immigration enforcement. Upon the request of a federal agency, county detention centers are also required to provide a list of 'all inmates' and 'any information' about each one's immigration status. 'Today, the Florida Legislature has passed the strongest legislation to combat illegal immigration of any state in the entire country,' DeSantis said earlier this year. 'We are ahead of the curve on ending the illegal immigration crisis.' Local elected officials who initially balked at signing cooperation agreements with ICE have been threatened by the state attorney general with removal from office. At Thursday's Miami-Dade commission meeting, the board was scheduled to vote on new provisions for the county's existing ICE agreement but ultimately deferred and chose to let Mayor Daniella Levine Cava ratify the deal herself. Levine Cava told people who attended the hearing that she had no choice in the matter: 'This is the law of Florida, and it was required that this agreement be signed.' She and several commissioners noted that any public records the county has jurisdiction over would continue to be publicly available. While officials in Miami-Dade have said they are committed to transparency, federal inmates, including people on immigration holds, had not been appearing in Orange County jail records until just last week. Ericka Gómez-Tejeda, organizing director for Hope Community Center, said officials in the central Florida county took the position that the federal records were not covered by state open records laws, meaning immigrants were effectively disappearing into the system. Gómez-Tejeda pointed to the case of Esvin Juarez, who was arrested and deported to Guatemala this month before his family and attorney even knew where he was being held. Making it difficult to track detained immigrants is intentional, she said. 'It's working to the advantage of people's due process being violated,' Gómez-Tejeda said. Orange County Mayor Jerry Demings directed the jail to begin posting information about ICE detainees last week, but Gómez-Tejeda said that might not help inmates were arrested in other counties or states before being taken to Orange County. 'We have people who have been sent to four or five different detention centers,' Gómez-Tejeda said. 'And each state that you go into, that family then needs to identify an attorney that will then do their representation and their paperwork. So it puts an onerous responsibility on the families.' U.S. Rep. Maxwell Frost, a Democrat who represents the Orlando area, introduced legislation this month aimed at stopping unlawful detention and ending detainee mistreatment. It would require all ICE facilities to publicly report who is being detained, as well as where, when and why. 'This bill won't fix everything, but if Donald Trump and his allies think these policies are defensible, then they shouldn't be afraid to tell the public exactly what they're doing,' Frost said. 'If they're proud of it, they'll report it. If they're ashamed, they need to end it.'
San Francisco Chronicle
22 minutes ago
- San Francisco Chronicle
Asian shares are mixed, tracking Wall Street split as momentum slows and Tesla drops
MANILA, Philippines (AP) — Asian shares were mixed on Wednesday following a similar drift overnight on Wall Street as losses for Tesla and other technology shares put a brake on the momentum of recent record highs. U.S. futures edged higher and oil prices were little changed. Shares fell in Japan, hit by jitters over a lack of progress in trade talks with the U.S., but they recovered much of their lost ground, trading 0.3% lower at 39,874.33. Stephen Innes, managing partner at SPI Asset Management, pointed to President Donald Trump's declaration that there will be no extension of his tariff pause, which ends on July 9. 'The message was blunt: if Tokyo won't yield, it will pay. Tariffs of 30%, 35% or 'whatever number we determine' are now openly back on the table,' he said. 'The negotiating table just became a pressure cooker.' Hong Kong's Hang Seng advanced 0.6% to 24,220.65 and the Shanghai Composite index was down just over 1 point at 3,456.51. Australia's S&P ASX 200 edged up 0.4% to 8,580.70. On Tuesday, the S&P 500 dipped 0.1% to 6,198.01 for its first loss in four days. The Dow Jones Industrial Average rose 0.9% to 44,494.94, and the Nasdaq composite fell 0.8% to 20,202.89. Tesla tugged on the market as the relationship between its CEO, Elon Musk, and President Donald Trump soured even further. Once allies, the two have clashed recently, and Trump suggested there's potentially 'BIG MONEY TO BE SAVED' by scrutinizing subsidies, contracts or other government spending going to Musk's companies. Tesla fell 5.3%. It has lost just over a quarter of its value so far this year, 25.5%, in large part because of Musk's and Trump's feud. Drops for several darlings of the artificial-intelligence frenzy also weighed on the market. Nvidia's decline of 3% was the heaviest weight on the S&P 500. But more stocks within the index rose than fell, led by several casino companies. They rallied following a report showing better-than-expected growth in overall gaming revenue in Macao, China's casino hub. Las Vegas Sands gained 8.9%, Wynn Resorts climbed 8.8% and MGM Resorts International rose 7.3%. Automakers outside of Tesla were also strong, with General Motors up 5.7% and Ford Motor up 4.6%. The U.S. stock market has made a stunning recovery from its springtime sell-off of roughly 20%. But challenges still lie ahead for Wall Street, with one of the largest being the continued threat of Trump's tariffs. Many of Trump's stiff proposed taxes on imports are currently on pause, and they're scheduled to kick into effect in about a week. Depending on how big they are, they could hurt the economy and worsen inflation. Washington is also making progress on proposed cuts to tax rates and other measures that could send the U.S. government's debt spiraling higher, which could raise inflation. That in turn could mean higher interest rates, which would hurt prices for bonds, stocks and other investments. Despite such challenges, strategists at Barclays say they see signals of euphoria among some investors. The strategists say a measure that tries to show how much 'excess optimism' is in the market is not far from the peaks seen during the 'meme stock' craze that sent GameStop to market-bending heights or to the dot-com bubble at the turn of the millennium. In other dealings early Wednesday, benchmark U.S. crude gained 1 cent to $65.46 per barrel. Brent crude, the international standard, rose 5 cents per barrel to $67.16.
