Latest news with #Nikkei225
Yahoo
a day ago
- Business
- Yahoo
The End of the Easy US Stock Bet Has Been Good to Contrarians
(Bloomberg Markets) -- On Wall Street, it's been years since anyone had to think very hard to make money. Buy the largest US stocks, ignore everything else and watch your portfolio soar. Investing was reduced to one-click simplicity. NYC Congestion Toll Brings In $216 Million in First Four Months Now With Colorful Blocks, Tirana's Pyramid Represents a Changing Albania The Economic Benefits of Paying Workers to Move NY Wins Order Against US Funding Freeze in Congestion Fight Why Arid Cities Should Stick Together Then life got more complicated. President Donald Trump's sudden tariff escalation in April offered a glimpse of what a world without that certainty might look like. Confidence wavered—not just in megacap resilience, but in American economic exceptionalism and Trump's market-friendly reputation. But after a sharp market decline, some of the panic subsided. The president backed away from some of his most dramatic tariff plans, and major US equity indexes bounced back. On May 28, a US trade court said many of Trump's tariffs were illegal, with the administration appealing the decision. Yet for many, the market and political mayhem highlighted the increasing fragility of the one-way buy-America trade. You can still see the shadows of all that doubt in the lower value of the dollar, in Moody's Ratings' recent decision to downgrade America's debt, and in the steady drumbeat of money finding its way to anything that isn't just another bet on US stocks. A motley crew of finance professionals long dismissed as having complex and cautious strategies have been having their moment. With megacap valuations still looking stretched, these money managers are pitching a slew of allocation ideas to investors newly receptive to the age-old virtue of diversification. 'I am looking forward to this being a world again where prices matter,' says Ben Inker, the co-head of asset allocation at Grantham Mayo Van Otterloo, a money manager known for bull-market skepticism as well as its dedication to value investing. His GMO International Developed Equity Allocation Fund is up about 20% this year—its biggest outperformance over the S&P 500 since the strategy's 2006 inception. The fund has about half its assets in Europe and almost 30% in Japan. Meb Faber, too, has been waiting patiently for this. The founder of Cambria Investment Management LP has been calling the end of the US exceptionalism trade for years. Before 2025 his model, which spread money across regions and assets, had trailed the S&P 500 in 14 out of 16 years. Now people are seeing the virtues of contrarian strategies. 'Nobody is interested in talking about or wanting any of these investments, and all of a sudden you just blink, and the next thing you know, they're outperforming,' Faber says. Nothing lasts forever, Faber says. He points the 1980s, when international markets, Japan's in particular, left American equities in the dust. That episode foreshadowed the Nikkei 225's two decades of woe. Fund flows highlight the shift away from the go-long-US trade. International equities are attracting money in droves. Exchange-traded funds holding value stocks, which typically snub the top-heavy Magnificent Seven tech stocks, have already seen $30 billion in inflows this year. Hedge funds attracted about $14 billion in cash this year through April, according to data compiled by fund administrator Citco. And quantitatively driven diversification strategies—with names like risk parity and factor investing that seem designed to resist easy marketing—are gaining fresh attention. Also on the hot list: buffer funds, a breed of ETF that employs stock options to limit a portfolio's downside while capping the upside. And there's been a revival of once-dormant techniques such as portable alpha, a way of using borrowed money to try to sprinkle some idiosyncratic bets on top of exposure to the market index. 'There's not as big an opportunity cost in introducing diversification and having to sacrifice that core stock exposure,' says Corey Hoffstein, chief investment officer of quantitative money manager Newfound Research, speaking of portable alpha. This year 'has been about making diversification look great again,' says Dan Villalon, principal at AQR Capital Management LLC, a Greenwich, Connecticut-based manager of quant and hedge fund strategies. 'We see it in every dimension: We see in equity markets. We see it in asset classes. We see it in alternative strategies.' AQR has long warned that US dominance of equity markets is at risk and that investors are underdiversified. Of course, the push to spread out risks comes with big pitfalls. In an age of artificial intelligence advances, there's a constant fear of missing out on another Big Tech rally. Already, chipmaker Nvidia Corp.—a key member of the Mag 7—has roared back from its April depths, notching a near-30% return over the past month. Moreover, the leverage used in many market-defying strategies can easily backfire. And many of these techniques layer on cost and are poorly understood by clients. Villalon, for example, has been an outspoken critic of buffer funds. AQR has published research arguing that a simple mix of stocks and safe Treasury bills is a better bet for those seeking downside Benz, director of personal finance and retirement planning at the research firm Morningstar Inc., likewise argues that most individual investors can do just fine with a low-cost, do-it-yourself version of diversification. Just own a broad of mix of different assets. 'I would argue that the basic principles of asset allocation are delivering beautifully this year—the vanilla strategy of holding cash and bonds to cushion against equity losses has been a winning one. Diversifying equity exposure globally has also helped.'And there's still a large chorus warning against giving up on stocks in the world's most dynamic economy. 'With ever more complex investment products becoming available to retail investors, history keeps proving that a simple, diversified portfolio of large-cap stocks wins out,' says Liz Miller, president of Summit Place Financial Advisors LLC. 'Alternative and structured investments can appeal to investors' fears of market volatility, but long-term growth comes from investing appropriately in equities and staying committed throughout market turmoil.' Still, investors seem to have widened their view of the range of outcomes. For Vineer Bhansali, CIO and founder of LongTail Alpha LLC, it's been the busiest time since the onset of the pandemic. LongTail's name refers to the rare but extreme events that can occur at both ends of the bell curve of possible market outcomes; the firm sells strategies that hedge the really bad ones but often suffer losses in a bull market. Bhansali says clients are calling all day with concerns about high exposure to US stocks and market patterns breaking down. Recently, a $24 billion Australian pension fund allocated to the strategies. 'Everybody has a lot of US assets,' Bhansali says. 'Trade, the reason this whole thing is happening, is a global phenomenon. Everybody gets pulled into it. Everybody's concerned about what happens to their old global asset allocation.' YouTube Is Swallowing TV Whole, and It's Coming for the Sitcom Mark Zuckerberg Loves MAGA Now. Will MAGA Ever Love Him Back? Millions of Americans Are Obsessed With This Japanese Barbecue Sauce Inside the First Stargate AI Data Center How Coach Handbags Became a Gen Z Status Symbol ©2025 Bloomberg L.P. 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
Straits Times
a day ago
- Business
- Straits Times
Singapore stocks fall as Trump tariffs resumes for now; STI retreats 0.6%
The STI was led by DFI Retail Group, which rose 3 per cent to US$2.76. PHOTO: ST FILE Singapore stocks fall as Trump tariffs resumes for now; STI retreats 0.6% SINGAPORE – The Trump tariff roller-coaster took another swing through markets on May 30 and helped depress shares across the region. The latest twist in the seemingly never-ending saga came when a US appeals court paused a ruling that blocked President Donald Trump's sweeping tariffs, and in turn stopped Thursday's rally dead in its tracks. That left the benchmark Straits Times Index (STI) down 0.6 per cent or 22.23 points to 3,894.6 with losers beating gainers 248 to 209 on trade of 1.3 billion securities worth $3.3 billion. Ms Ipek Ozkardeskaya, analyst at Swissquote Bank, said the optimism triggered by the initial ruling that halted the 'Liberation Day' tariffs 'turned out too good to be true' as it is now effectively on hold. 'If tariffs are ultimately found to be unlawful, the willingness of partners to make concessions during trade talks may shrink – not exactly ideal, especially given the critical window for negotiations,' she added. Regional indexes reacted negatively. Hong Kong's Hang Seng lost 1.2 per cent, South Korea's Kospi fell 0.8 per cent, the Nikkei 225 in Tokyo declined 1.2 per cent and Malaysian shares slipped 0.7 per cent. By contrast, Wall Street shrugged off the tariff news overnight and focused more on tech stocks after Nvidia posted robust earnings. The Nasdaq and S&P 500 both rose 0.4 per cent while the Dow Industrials added 0.3 per cent. Meanwhile, the STI was led by DFI Retail Group, which rose 3 per cent to US$2.76. After the market closed, the group said it will divest a 22.2 per cent stake in Robinsons Retail. DFI parent company Jardine Matheson did not fare so well, falling 2.4 per cent to US$44.50, after announcing that chief executive John Witt is retiring at the end of November. The local banks were in the red: DBS fell 0.6 per cent to $44.72; UOB declined 1.2 per cent to $35.41; and OCBC retreated 1 per cent to $16.23. THE BUSINESS TIMES Join ST's Telegram channel and get the latest breaking news delivered to you.
The Star
a day ago
- Business
- The Star
Bursa Malaysia sinks amid foreign sell-off and regional weakness
KUALA LUMPUR: Bursa Malaysia remained under selling pressure on Friday as foreign investors continued to pare down their holdings, amid ongoing tariff concerns and weakness in regional markets. The benchmark FBM KLCI slid 10.63 points, or 0.7%, to 1,508.35 — its intraday low. It fell 1.8% for the week and about 2.1% for the month of May. Stocks that fell outnumbered those that rose 616 to 336, with another 418 counters unchanged. A total of 3.2 billion shares changed hands, worth RM5.04bil. Dealers said selling in the past few days has shaken market sentiment, pushing more investors to the sidelines. They added that overall conditions remain tepid, with interest staying relatively muted even as foreign investors continue to sell. Among the decliners, Nestle tumbled RM2.26 to RM78.60, Ajinomoto slid RM1.28 to RM12.96, PETRONAS Dagangan fell 80 sen to RM19.70 and Heineken lost 60 sen to RM7.10. Hong Leong Financial Group rose 32 sen to RM16.58, Bintulu Port gained 21 sen to RM5.46, F&N added 20 sen to RM27.30 and Kumpulan Fima climbed 19 sen to RM2.58. Among the actives, KPJ slid 24 sen to RM2.72, with 81.42 million shares traded, Eco Shop added seven sen to RM1.26, with 63.15 million shares done, and Public Bank traded flat at RM4.31, with 62.14 million shares changing hands. Meanwhile, the ringgit was quoted at 4.2585, slipping 0.36% against the US dollar. It also fell 0.24% to 3.2969 against the Singapore dollar. Among the key regional markets: Japan's Nikkei 225 closed down 1.22% to 37,965.10; South Korea's Kospi slipped 0.84% to 2,697.67; Hong Kong's Hang Seng Index fell 1.2% to 23,289.77; China's CSI 300 Index finished down 0.48% to 3,840.23 and; Singapore's Straits Times Index fell 0.57% to 3,894.61 points.
RTÉ News
a day ago
- Automotive
- RTÉ News
Trump's tariff tally: $34 billion and counting, global companies say
President Donald Trump's trade war has cost companies more than $34 billion in lost sales and higher costs, according to a Reuters analysis of corporate disclosures. This toll is expected to rise as ongoing uncertainty over tariffs paralyses decision making at some of the world's largest companies. Across the US, Asia and Europe, companies including Apple, Ford, Porsche and Sony have pulled or slashed their profit forecasts, and an overwhelming majority say the erratic nature of Trump's trade policies has made it impossible to accurately estimate costs. Reuters reviewed company statements, regulatory filings, conference and media call transcripts to pull together for the first time a snapshot of the tariff cost so far for global businesses. The $34 billion is a sum of estimates from 32 companies in the S&P 500, three companies from Europe's STOXX 600 and 21 companies in Japan's Nikkei 225 indices. Economists say the cost to businesses will likely be multiple times what companies have so far disclosed. "You can double or triple your tally and we'd still say ... the magnitude is bound to be far greater than most people realise," said Jeffrey Sonnenfeld, professor at the Yale School of Management. The ripple effects could be worse, he added, citing the potential for lower spending from consumers and businesses, higher inflation expectations. While a recent pause in Sino-US trade hostilities has offered some relief and Trump has backed down from tariff threats against Europe, it is still not clear what the final trade deals will look like. A US trade court on Wednesday blocked Trump's tariffs from going into effect. In this environment, strategists say companies will look to strengthen supply chains, boost near-shoring efforts, and prioritise new markets - all of which will push up costs. Companies themselves are uncertain about the final cost. As the corporate earnings season draws to a close, Reuters found at least 42 companies have cut their forecasts and 16 have withdrawn or suspended their guidance. For instance, earlier this month, Walmart declined to provide a quarterly profit forecast and said it would raise prices, drawing a rebuke from Trump. Volvo Cars, one of the European automakers most exposed to US tariffs, withdrew its earnings forecast for the next two years and United Airlines gave two different forecasts, saying it was impossible to predict the macro environment this year. Trump has argued that tariffs will cut America's trade deficit and prompt companies to move operations to the country, bringing jobs back home. Tariffs will also force countries including Mexico to stop the flow of illegal immigrants and drugs into the US, Trump has said. "The administration has consistently maintained that the US has the leverage to make our trading partners ultimately bear the cost of tariffs," said White House spokesperson Kush Desai. Tariff talk On earnings conference calls for the January to March quarter, 360 companies, or 72%, in the S&P 500 index mentioned tariffs, up from 150 companies, or 30%, in the previous quarter. Executives at 219 companies listed on the STOXX 600 mentioned tariffs, compared with 161 in the prior quarter. Of the Nikkei 225 companies in Japan, that number was 58, up from 12 earlier. "I don't think corporations have an awful lot of visibility about anything in the future," said Rich Bernstein, CEO of Richard Bernstein Advisors in New York. Referring to withdrawn forecasts, he said. "If you take into account this uncertain world and you can't guide anybody to a number, it's safer not to guide," he added. Wall Street is expecting net profit for companies in the S&P 500 index to grow at an average 5.1% per quarter from April to December, compared to a growth rate of 11.7% a year earlier, according to data compiled by LSEG. Automakers, airlines and consumer goods importers have been among the worst hit. Levies on raw material costs and parts including aluminum and electronics have risen, and tariffs on multiple countries are making assembling cars more expensive because of far-flung supply chains. Moving any production to the US will also raise labour costs. Kleenex tissue maker Kimberly Clark slashed its annual profit forecast last month and said it would incur about $300m in costs this year as tariffs push up its supply-chain costs. A few days later the company said it would invest $2 billion over five years to expand its manufacturing capacity in the US, a number not included in the Reuters tally. Companies including Apple and Eli Lilly have this year announced investments in the US. Johnnie Walker whiskey and Don Julio tequila maker Diageo, which also makes Guinness, said said earlier this month it would cut $500m in costs and make substantial asset disposals by 2028, as a 10% tariff on imports from places like Britain and the European Union is expected to deal a $150m hit to its operating profit every year.
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Business Standard
a day ago
- Business
- Business Standard
Asian shares mostly decline as uncertainty grows about Trump tariffs
Asian shares were mostly lower Friday as uncertainty grew about what will happen next after a US court blocked many of President Donald Trump's sweeping tariffs. Japan's benchmark Nikkei 225 lost 1.4 per cent in morning trading to 37,892.39. Government data showed Tokyo core inflation, excluding fresh food, accelerating to a higher-than-expected 3.6 per cent in May. Some analysts say that makes it more likely the Bank of Japan will raise interest rates. Australia's S&P/ASX 200 was little changed, inching down less than 0.1 per cent to 8,404.50. South Korea's Kospi declined 0.6 per cent to 2,703.64, ahead of a presidential election set for next week. Hong Kong's Hang Seng slipped 1.4 per cent to 23,235.94, while the Shanghai Composite shed 0.3 per cent to 3,353.07. On Wall Street, the S&P 500 rose 0.4 per cent on Thursday after giving up more than half of an early gain. The Dow Jones Industrial Average added 117 points, or 0.3 per cent, and the Nasdaq composite rose 0.4 per cent. It's a downshift after stocks initially leaped nearly 2 per cent in Tokyo and Seoul, where markets had the first chance to react to the ruling late Wednesday by the US Court of International Trade. The court said that the 1977 International Emergency Economic Powers Act that Trump cited for ordering massive increases in taxes on imports from around the world does not authorize the use of tariffs. The ruling at first raised hopes in financial markets that a hamstrung Trump would not be able to drive the economy into a recession with his tariffs, which had threatened to grind down on global trade and raise prices for consumers already sick of high inflation. But the tariffs remain in place for now while the White House appeals the ruling, and the ultimate outcome is still uncertain. The court's ruling also affects only some of Trump's tariffs, not those on foreign steel, aluminum and autos, which were invoked under a different law. The Court of Appeals for the Federal Circuit on Thursday allowed the president to temporarily continue collecting the tariffs under the emergency powers law while he appeals the trade court's decision. Trump is still able to impose significant and wide-ranging tariffs over the longer-term through other means, according to Ulrike Hoffmann-Burchardi, chief investment officer of global equities at UBS Global Wealth Management. On Wall Street, tech stocks led the way after Nvidia once again topped analysts' expectations for profit and revenue in the latest quarter. The chip company has grown into one of the US market's largest and most influential stocks because of the frenzy around artificial-intelligence technology, and its 3.2 per cent rise was the strongest force by far lifting the S&P 500. Best Buy fell 7.3 per cent even though it reported a stronger profit than expected. The electronics retailer also cut its forecasted ranges for revenue and profit over the full year on the assumption that tariffs stay at the current levels, Chief Financial Officer Matt Bilunas said. All told, the S&P 500 rose 23.62 points to 5,912.17. The Dow Jones Industrial Average added 117.03 to 42,215.73, and the Nasdaq composite gained 74.93 to 19,175.87. In the bond market, Treasury yields eased following some mixed reports on the economy. One said that the US economy likely shrunk by less in the first three months of the year than earlier estimated. Another said slightly more US workers applied for unemployment benefits last week than economists expected. The yield on the 10-year Treasury fell to 4.43 per cent from 4.47 per cent late Wednesday. In energy trading, benchmark US crude dropped 30 cents to USD 60.64 a barrel. Brent crude, the international standard, fell 31 cents to USD 63.84 a barrel. In currency trading, the US dollar declined to 143.92 Japanese yen from 144.12 yen. The euro cost USD 1.1355, down from USD 1.1367. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
