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CNBC
09-05-2025
- Business
- CNBC
CNBC Daily Open: London markets didn't seem to view the U.K.-U.S. trade deal positively
The U.K. is the first country to seal a trade deal with the U.S. Cue the jubilations. And investors certainly did, giving the three major U.S. indexes back-to-back winning sessions. Curiously, the mood across the Atlantic wasn't as upbeat: the U.K.'s FTSE 100 closed lower following the announcement of the agreement. To be sure, the U.K. extracted some concessions, such as a lower tariff rate on its first 100,000 vehicles exported to the U.S. and securing new discussions for U.S. President Donald Trump's universal 25% levies on steel and aluminum imports. That said, the deal does seem more advantageous to the U.S., at least based on the fact that a 10% tariff will remain on all U.K. imports, alongside other compromises allowed by Britain. The U.S. already runs a trade surplus with the U.K., meaning that it exports more to the country than it imports. And a 10% tariff was what Trump slapped on the U.K. on April 2, so there was no reduction in those levies despite both countries reaching an agreement. "What we heard today is just noise for most U.K. imports. It doesn't affect the majority of products," Andy Abbott, CEO of niche ocean liner company Atlantic Container Line, told CNBC's Lori Ann LaRocco. Based on the available details, Washington seems to have got the better end of the deal. UK makes preliminary trade deal with U.S.U.S. President Donald Trump on Thursday laid out the outline of a trade agreement with the United Kingdom. Many specifics about the deal were not immediately clear, and nothing was signed during the Oval Office event. A White House fact sheet stated that the U.S. will keep a blanket 10% tariff on U.K. imports, which Trump said will be floor for tariffs. The impact of the deal could be limited, a freight CEO said. Most markets rally on trade deal newsU.S. stocks climbed Thursday on news of the freshly minted U.S.-U.K. agreement. The S&P 500 added 0.58%, the Dow Jones Industrial Average gained 0.62% and the Nasdaq Composite advanced 1.07%, boosted by a broad rise in tech shares. Asia-Pacific markets mostly rose Friday. Hong Kong's Hang Seng Index was up 0.2% even as shares of Semiconductor Manufacturing International Corporation, China's largest contract chipmaker, fell nearly 7% after its first-quarter earnings missed estimates. China's April exports surge despite U.S. tariffsChina's exports in April jumped 8.1% in U.S. dollar terms from a year earlier, according to data released by the country's customs authority on Friday, sharply beating Reuters' poll estimates of a 1.9% rise. The surge in exports defies a 21% year-on-year plunge in China's outbound shipments to the U.S., based on CNBC's calculation of official customs data. China's exports to the Association of Southeast Asian Nations climbed 20.8% in April from a year earlier, helping to offset the drop in exports to the U.S. Coinbase misses estimates as bitcoin jumpsCoinbase shares fell nearly 3% in extended trading after it reported first-quarter revenue that failed to meet expectations. The company said consumer trading volume fell 17% from the fourth quarter. The same day, bitcoin prices rose almost 7% during U.S. trading hours to above $100,000 for the first time since February, and a Standard Chartered analyst wrote a tongue-in-cheek apology that his target of $120,000 for bitcoin "may be too low." First American pope electedCardinal Robert Francis Prevost was elected as pope on Thursday, the first time an American has been selected as pontiff of the Roman Catholic Church. Prevost, 69, chose the papal name Leo XIV. Following the news, Trump congratulated the new pope, writing on Truth Social that Leo being the "first American Pope" is "a Great Honor for our Country." [PRO] Trade deal only a temporary stimulus?Even though investors cheered the U.S.-U.K. trade deal and sent stocks higher Thursday, CNBC Pro contributor Josh Brown, CEO of Ritzholtz Wealth Management, is keeping his expectations of a prolonged market rebound in check — and points out two defensive tech stocks because they behave more like consumer staples. U.S. tariff pressure has retailers evaluating their prices Household brands including Pandora, Puma and Hugo Boss said this week that they are evaluating their pricing strategies in the U.S. and beyond, in the event that President Donald Trump's most punitive levies come into effect. Others said that they are altering their supply chains and potentially revising their sales forecasts amid U.S. trade policy uncertainty. Last month, Trump announced sweeping, so-called reciprocal import duties on all U.S. trading partners. The charges were later paused for 90 days and reduced to 10% for most countries except China, pending trade negotiations. Here's what some major European retailers have been saying about their product prices and earnings outlooks.
CNBC
09-05-2025
- Business
- CNBC
CNBC Daily Open: Wall Street cheered U.S.-UK trade deal — London market, not really
The U.K. is the first country to seal a trade deal with the U.S. Cue the jubilations. And investors certainly did, giving the three major U.S. indexes back-to-back winning sessions. Curiously, the mood across the Atlantic wasn't as upbeat: the U.K.'s FTSE 100 closed lower following the announcement of the agreement. To be sure, the U.K. extracted some concessions, such as a lower tariff rate on its first 100,000 vehicles exported to the U.S. and securing new discussions for U.S. President Donald Trump's universal 25% levies on steel and aluminum imports. That said, the deal does seem more advantageous to the U.S., at least based on the fact that a 10% tariff will remain on all U.K. imports, alongside other compromises allowed by Britain. The U.S. already runs a trade surplus with the U.K., meaning that it exports more to the country than it imports. And a 10% tariff was what Trump slapped on the U.K. on April 2, so there was no reduction in those levies despite both countries reaching an agreement. "What we heard today is just noise for most U.K. imports. It doesn't affect the majority of products," Andy Abbott, CEO of niche ocean liner company Atlantic Container Line, told CNBC's Lori Ann LaRocco. Based on the available details, Washington seems to have got the better end of the deal. UK takes lead: strikes a deal with U.S.U.S. President Donald Trump on Thursday laid out the outline of a trade agreement with the United Kingdom. Many specifics about the deal were not immediately clear, and nothing was signed during the Oval Office event. A White House fact sheet stated that the U.S. will keep a blanket 10% tariff on U.K. imports, which Trump said will be floor for tariffs. The impact of the deal could be limited, a freight CEO said. Most markets rally on trade deal newsU.S. stocks climbed Thursday on news of the freshly minted U.S.-U.K. agreement. The S&P 500 added 0.58%, the Dow Jones Industrial Average gained 0.62% and the Nasdaq Composite advanced 1.07%, boosted by a broad rise in tech shares. The pan-European Stoxx 600 index rose 0.4%. The U.K.'s FTSE 100 dropped 0.32%, giving up earlier gains as the country and the U.S. announced a trade deal and its central bank cut interest rates. Britain's central bank lowers ratesThe Bank of England on Thursday cut interest rates to 4.25% from 4.5%. The cut had been widely expected, especially after a slowdown in price rises, with annual inflation cooling to 2.6% in March, down from 2.8% the previous month. Five of the BOE's nine policymakers voted for the cut, with two members wanting a larger 50-basis-point reduction, and two wanting to keep rates on hold. Coinbase misses estimates as bitcoin jumpsCoinbase shares fell nearly 3% in extended trading after it reported first-quarter revenue that failed to meet expectations. The company said consumer trading volume fell 17% from the fourth quarter. The same day, bitcoin prices rose almost 7% to above $100,000 for the first time since February, and a Standard Chartered analyst wrote a tongue-in-cheek apology that his target of $120,000 for bitcoin "may be too low." First American pope electedCardinal Robert Francis Prevost was elected as pope on Thursday, the first time an American has been selected as pontiff of the Roman Catholic Church. Prevost, 69, chose the papal name Leo XIV. Following the news, Trump congratulated the new pope, writing on Truth Social that Leo being the "first American Pope" is "a Great Honor for our Country." [PRO] Trade deal only a temporary stimulus?Even though investors cheered the U.S.-U.K. trade deal and sent stocks higher Thursday, CNBC Pro contributor Josh Brown, CEO of Ritzholtz Wealth Management, is keeping his expectations of a prolonged market rebound in check — and points out two defensive tech stocks because they behave more like consumer staples. Why the Bank of England governor thinks uncertainty is here to stay despite a trade deal Bank of England Governor Andrew Bailey told CNBC on Thursday that the U.K. was heading for more economic uncertainty, despite the country being the first to strike a trade agreement with the U.S. under President Donald Trump's controversial tariff regime. "The tariff and trade situation has injected more uncertainty," Bailey told CNBC in an interview. "A U.K.-U.S. trade agreement is very welcome in that sense, very welcome. But the U.K. is a very open economy." That means that the impact from tariffs on the U.K. economy comes not just from its own trade relationship with Washington, but also from those of the U.S. and the rest of the world, he said.
CNBC
08-05-2025
- Automotive
- CNBC
U.S.-U.K. trade deal: From Ford to McLaren, steel to beef, impact to be limited, says freight CEO
The U.S.-U.K. trade deal announced by President Trump on Thursday will result in some wins across the autos, agriculture and industrial sectors, but the overall impact on trade will be limited, according to a freight CEO whose company handles shipments across the Atlantic Ocean route. For most U.K. importers, the deal terms disclosed to date would not affect the majority of products, Andy Abbott, CEO of niche ocean liner company Atlantic Container Line, tells CNBC. "A lot of this deal is smoke and mirrors," Abbott said. "What we heard today is just noise for most U.K. imports. It doesn't affect the majority of products." For one, he said the U.K. government is not weakening its food standards on meat imports, so any hormone-treated beef from the U.S. "is not on the table." The National Cattlemen's Beef Association called the deal a "tremendous win," in a statement on Thursday, but the US Meat Export Federation said it needed more details. In autos, U.K.-manufactured cars are on the upper end of the pricing spectrum from automakers including Lotus, Rolls-Royce, Bentley, McLaren, Jaguar Land Rover, and Mini. So, while the deal will soften the blow for luxury car companies, "I don't see anyone moving from a British car to a Ford because of a 10% tariff," Abbott said. A separate deal for the U.K. when it comes to steel tariffs could be good news for U.S. companies like industrial equipment maker Cummins, and high-tech steel importers in the aerospace and auto sectors, Abbott said. A fact sheet from the White House calls for an alternative to the tariffs on steel and aluminum for the U.K. It also detailed a plan for the first 100,000 vehicles imported from U.K. car manufacturers each year to face a 10% rate, and any additional vehicles a 25% tariff. And it estimates a $5 billion opportunity for farm exports, including $700 million in ethanol and $250 million in beef and other ag products. But with the 10% tariffs as a baseline, Abbott says most British products imported to the U.S. are likely to get more expensive. "The news today may prompt U.S. importers of U.K. products to raise prices sooner rather than later, as they assume no relief below the 10% tariff level is coming," he said. "Most have been swallowing the extra cost until now." United States Trade Representative Jamieson Greer said on CNBC on Thursday that this deal is the framework other countries should look to as a model, with the U.K. the sixth-largest economy in the world, and is "the exact type of deal we should be making." But Abbott's view of the deal's impact matches that of trade and market experts, such as Josh Lipsky, Atlantic Council senior director, who told CNBC on Thursday that the deal was limited in scope, and a "very small win." "Forty days out from 'Liberation Day' and the first win is U.S.-U.K. ... it's not great news," Lipsky said. He said it's a win for the U.K. to say it was first to reach a deal, but aside from that, he said the 10% baseline tariffs still in place are a sign that higher tariff rates stay on for longer. Oxford Economics said in an analysis on Thursday that with the baseline 10% tariff untouched, "tariff rates will be in the double digits for the foreseeable future." It added that anyone hoping for a major de-escalation in the trade war wasn't given any reason to believe this would spur it, and that "the lack of specifics suggests those headline figures could be spread over many years, and will include some purchases that would have been made anyway." There had been a surge in trade from Europe to the U.S. since April after Trump announced a pause on reciprocal tariffs for countries other than China, but those volumes have pulled back to more normal levels, Abbott said. The European Union launched a trade dispute against the U.S. tariffs at the World Trade Organization on Thursday. "The car carriers are canceling sailings now due to reduced volume," said Abbott, who added that his company has not cancelled sailings because of its niche business carrying oversized cargo, as well as containers, and not cars. "We are now getting space inquiries from European car manufacturers for the first time since Covid," he said. Recent trade data has shown evidence of a likely drop at East Coast ports following what already occurred at West Coast ports, where Chinese freight shipments and vessel visits have plummeted. The impact of the vessel cancellations coming to the East Coast has not been felt yet, but Abbott said he is expecting a pullback in the middle of May. "Everything I am seeing indicates that the frontloading from Europe has slowed down after the short surge that followed the 'pause' announcement," he said. "In Europe, the numbers are skewed a bit because of the Easter and May Day holidays, but the volumes now are just 'decent' and not spectacular – very similar to 2024 on U.S. imports." Abbott said European importers are waiting to see if the pause is extended, and if not, another surge could begin. "I expect another surge again in early June," Abbott said. For ACL, shippers can depart the U.K. as late as June 21 and still arrive in time before the current pause ends. "Most are looking at that date as their deadline. So, I don't expect anything unusual to occur before then unless some new proclamation is made," he said. While many U.S. exports to Europe remain healthy, including construction equipment, Abbott said autos are an exception. "What is troubling is we are seeing a big cargo hold on automobiles bound for Europe. The car companies cannot swallow a 25% tariff, and most consumers won't shell out an extra 25% for a new car." Abbott says one auto segment he is closely watching is the transport of used cars. There is some evidence of Americans buying more used cars instead of spending more on imports. A key used car price index hit its highest level since 2023, according to data released this week. Abbott said many ex-rental cars and leased cars end up getting shipped to West Africa, and it is a trade pattern that could change. "We have seen no changes in booking volume yet, but there are a lot of concerns from the traders about higher prices and reduced available volume in the months ahead," he said.
