Latest news with #SamuelIndyk
Yahoo
4 days ago
- Business
- Yahoo
Trump tariff push given new twist by court setback
By Samuel Indyk and Sarah Marsh (Reuters) -A U.S. trade court ruling that blocked most of President Donald Trump's tariffs and found he had overstepped his authority triggered some relief on financial markets on Thursday, while adding to the uncertainties weighing on the global economy. Among the United States' big trading partners, in the throes of negotiation with the Trump administration, Germany said it could not comment, as did the European Commission. "We ask for your understanding that we cannot comment on the legal proceedings in the U.S., as they are still ongoing," a spokesperson for Germany's economy ministry said. "We continue to hope that a mutually beneficial solution can be reached in the negotiations between the EU Commission and the U.S. government." Winners on financial markets included chip makers, banks, luxury stocks and auto industry, all hit hard by tariff-led disruptions. The U.S. dollar rallied 0.2% against the yen and 0.3% against the Swiss franc as currencies and assets that have benefited from the tariff-induced market turmoil fell. [MKTS/GLOB] Wall Street stock index futures rose by more than 1.5%. The trade court ruling on Wednesday dealt a blow to Trump's central policy of using tariffs to wring concessions from trading partners. His administration immediately said it will appeal and analysts said investors will remain cautious as the White House explores its legal avenues. If the court ruling holds, the president could deploy other trade laws to impose sector-specific levies as well as across-the-board and country-specific tariffs. Following a market revolt after his major tariff announcement on April 2, Trump paused most import duties for 90 days and said he would hammer out bilateral deals with trade partners. But apart from a pact with Britain this month, agreements remain elusive and the court's stay on the tariffs may dissuade countries like Japan from rushing into deals, analysts said. Another pause in Trump's stop-start trade policy could be helpful to opponents of his tariffs and to traders who relish volatility. "Assuming that an appeal does not succeed in the next few days, the main win is time to prepare, and also a cap on the breadth of tariffs – which can't exceed 15% for the time being," George Lagarias, chief economist at Forvis Mazars international advisers, said. TURMOIL Trump's trade war has shaken makers of everything from luxury handbags and sneakers to household appliances and cars as the price of raw materials has risen, supply chains have been disrupted and company strategies redrafted. Drinks company Diageo, automakers General Motors and Ford are among those who have abandoned forecasts for the year ahead. Non-U.S. companies including Honda, Campari and pharmaceutical companies Roche and Novartis have said they are considering moving operations or expanding their U.S. presence to mitigate the impact of tariffs. As markets assessed the latest twist in the trade upheaval, European export-sensitive sectors, such as autos and luxury stocks, were among leading gainers on Thursday. The pan-continental STOXX 600 was up 0.4%, while France's CAC 40, which has a heavy weighting of luxury and bank stocks, rose 0.8%. Overall sentiment was also lifted by strong results late on Wednesday from AI bellwether Nvidia. Spot gold declined for a fourth straight day, while U.S. Treasury yields rose. Bond yields move inversely with prices. But the gains in shares may be short-lived, analysts said, with those who relish risk making the most of them. "I think we are in a period of higher volatility - we will get some more spikes on the way, I think. But volatility is the friend of the active investors," Kevin Barker, global head of active equities, UBS Asset Management, told a media briefing.
Yahoo
4 days ago
- Business
- Yahoo
US ruling that Trump tariffs are unlawful stirs relief and uncertainty
By Samuel Indyk and Sarah Marsh (Reuters) -A U.S. trade court ruling that blocked most of President Donald Trump's tariffs and found he had overstepped his authority triggered some relief on financial markets on Thursday, while adding to the uncertainties weighing on the global economy. Among the United States' big trading partners, in the throes of negotiation with the Trump administration, Germany said it could not comment, as did the European Commission. "We ask for your understanding that we cannot comment on the legal proceedings in the U.S., as they are still ongoing," a spokesperson for Germany's economy ministry said. "We continue to hope that a mutually beneficial solution can be reached in the negotiations between the EU Commission and the U.S. government." Winners on financial markets included chip makers, banks, luxury stocks and auto industry, all hit hard by tariff-led disruptions. The U.S. dollar rallied 0.2% against the yen and 0.3% against the Swiss franc as currencies and assets that have benefited from the tariff-induced market turmoil fell. Wall Street stock index futures rose by more than 1.5% The trade court ruling on Wednesday dealt a blow to Trump's central policy of using tariffs to wring concessions from trading partners. His administration immediately said it will appeal and analysts said investors will remain cautious as the White House explores its legal avenues. Following a market revolt after Trump's major tariff announcement on April 2, the U.S. president paused most import duties for 90 days and said he would hammer out bilateral deals with trade partners. But apart from a pact with Britain this month, agreements remain elusive and the court's stay on the tariffs may dissuade countries like Japan from rushing into deals, analysts said. Another pause in Trump's stop-start trade policy could be helpful to opponents of his tariffs and to traders who relish volatility. "Assuming that an appeal does not succeed in the next few days, the main win is time to prepare, and also a cap on the breadth of tariffs – which can't exceed 15% for the time being," George Lagarias, chief economist at Forvis Mazars international advisers, said. TURMOIL Trump's trade war has shaken makers of everything from luxury handbags and trainers to household appliances and cars as the price of raw materials has risen, supply chains have been disrupted and company strategies redrafted. Drinks company Diageo, automakers General Motors and Ford are among those who have abandoned forecasts for the year ahead. Non-U.S. companies including Honda, Campari and pharmaceutical companies Roche and Novartis have said they are considering moving operations or expanding their U.S. presence to mitigate the impact of tariffs. As markets assessed the latest twist in the trade upheaval, European export-sensitive sectors, such as autos and luxury stocks, were among leading gainers on Thursday. The pan-continental STOXX 600 was up 0.4%, while France's CAC 40, which has a heavy weighting of luxury and bank stocks, rose 0.8%. Overall sentiment was also lifted by strong results late on Wednesday from AI bellwether Nvidia. Spot gold declined for a fourth straight day, while U.S. Treasury yields rose. Bond yields move inversely with prices. But the gains in shares may be short-lived, analysts said, with those who relish risk making the most of them. "I think we are in a period of higher volatility - we will get some more spikes on the way, I think. But volatility is the friend of the active investors," Kevin Barker, global head of active equities, UBS Asset Management, told a media briefing.
Yahoo
22-05-2025
- Business
- Yahoo
Pound holds near three-year high on trade optimism
By Samuel Indyk LONDON (Reuters) -The British pound dipped slightly against the dollar but remained close to its highest level since 2022 reached the day before as hot inflation and improving relations with Europe and the U.S. continued to support the currency. The pound was last down 0.1% against the dollar at $1.3399, having touched a high of $1.3468 on Wednesday, its strongest level in over three years. Britain has recently looked to improve relations with the U.S. and the European Union, becoming the first nation to sign a deal with the U.S. after President Trump's reciprocal tariffs, and agreeing its biggest reset of trade and defence ties with the EU since Brexit this week. "The trade deals are generally good news for the pound," said ING FX strategist Francesco Pesole. "We still think the pound is in a pretty good position." Sterling was up 0.1% against at 84.2 pence per euro. A downturn in business activity for British firms eased this month, the S&P Global UK Composite Purchasing Managers' Index (PMI) showed on Thursday, as businesses grew a little cheerier about the outlook, including fewer worries about the impact of higher U.S. tariffs. The British currency has also been supported this week by hot inflation data, which might lower the prospect of rates cuts from the Bank of England. The BoE's chief economist Huw Pill said this week that a quarterly pace of cuts was "too rapid" given still strong wage pressures on inflation. "There's a bit of dissent building at the Bank of England," ING's Pesole noted. The British central bank lowered interest rates by a quarter point to 4.25% on May 8 in a three-way split vote, with two members of the Monetary Policy Committee favouring a bigger cut, and two - including Pill - preferring a hold. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Mint
21-05-2025
- Business
- Mint
Bitcoin surges to all-time peak as crypto sentiment improves
By Samuel Indyk, Alun John, Gertrude Chavez-Dreyfuss LONDON/NEW YORK (Reuters) -Bitcoin rose to its highest level on record on Wednesday, eclipsing the previous high from January, as risk sentiment continues to improve after last month's tariff-induced selloff. The world's largest cryptocurrency touched a high of $109,760.08, and was last up 1.1% at $108,117. Its ascent was driven by a combination of factors including easing trade tension between the United States and China and Moody's downgrade of U.S. sovereign debt which has prompted investors to seek alternative investment sources to the dollar. "Now that January's high has been surpassed - and the 50 percent upside from April's lows has been achieved - bitcoin enters blue sky territory with tailwinds in the form of institutional momentum and a favorable U.S. regulatory environment," Antoni Trenchev, co-founder of digital asset trading platform Nexo, said in an emailed comment. Bitcoin at times trades in a similar fashion to tech stocks and other assets that rise in value when investor sentiment is high. The tech-heavy Nasdaq is up 30% from its early April low. That has also coincided with continued weakness in the dollar, a further boost for bitcoin's exchange rate against the U.S. currency. Crypto market participants often point to increased involvement from traditional financial firms as reasons for its gains. This week they have referenced JPMorgan CEO Jamie Dimon, a longtime crypto skeptic, who said the bank will let clients buy bitcoin. Earlier this month, crypto exchange Coinbase was added to the S&P 500 index. Coinbase said on Monday the U.S. Department of Justice has opened a probe into a recent data breach at the company. "We're still in year four of the bitcoin price cycle - the year after the bitcoin halving when miner rewards are slashed in half - which historically means its best days are still ahead of it and - while macro uncertainty and the threat of further volatility remains, a target of $150,000 in 2025 is still very much on the cards," Trenchev said. Meanwhile, ether, the second-largest cryptocurrency, surprisingly did not rise in tandem with bitcoin. It was last down 0.5% at $2,513. (Reporting by Samuel Indyk and Alun John in London and Gertrude Chavez Dreyfuss in New York; Editing by Dhara Ranasinghe and Matthew Lewis)
Yahoo
15-05-2025
- Business
- Yahoo
Trump's tariff fog clouds outlook for Europe Inc after robust first quarter
By Samuel Indyk and Danilo Masoni LONDON (Reuters) -Europe Inc has weathered the turbulence sparked by U.S. President Donald Trump's tariff policies to deliver resilient first-quarter earnings, but in spite of the newly-minted trade truce, investors still face a fog of uncertainty. According to LSEG I/B/E/S, first quarter earnings are expected to have increased 1.9% from the same quarter a year ago, marking the fourth straight quarter of growth. Excluding the energy sector, earnings are expected to have risen 7.3%. The impact of Trump's tariffs and macro-economic uncertainty dominated corporate communications, while some companies warned about the strong euro and its impact on revenue. Cyclical parts of the market struggled, while bank earnings remained robust. Here are five key takeaways: UNCERTAINTY REIGNS Trump's tariff plans cast a shadow over earnings and companies mostly reacted by maintaining or pulling guidance, even as business got off to a relatively strong start to the year. "The last time we had this kind of uncertainty around guidance and companies pointing to a lack of visibility was Q1 in 2020 when COVID started," said Magesh Kumar Chandrasekaran, equity strategist at Barclays. "This has been the most unclear, or uncertain, earnings season from a guidance standpoint." Despite the relatively upbeat first quarter - where 60% of companies have beaten estimates, compared to a usual quarter of about 54% - consensus estimates for the full year have still been cut aggressively over the last two months. "It's going to be difficult to project first quarter earnings further down the year because so much has happened since the end of the quarter," said Kevin Thozet, member of the investment committee at Carmignac. MISSES PUNISHED BY MOST IN A DECADE As has been the case in recent quarters, earnings misses have been heavily penalised by the market, in part because expectations had been downgraded heading into reporting season. According to Goldman Sachs, the average relative price reaction for companies reporting below expectations has been a 2% drop, the most severe of the last 10 years. Rewards for earnings beats remain in line with the historical average. "There was probably expectation that some of the numbers in Q1 would have the benefit of front-loading and companies pulling activity forward because they were unsure what was going to happen in Q2," said Maarten Geerdink, head of the European equities team in fundamental equity at Goldman Sachs Asset Management. "So even though earnings expectations had dripped down, the market still believed they could beat these numbers. That's weighed pretty heavily on these misses." EURO RALLY ADDS TO HEADWINDS Not only were corporates worried about tariffs, but they sounded the alarm over the unexpected strength of the euro, as investors shunned dollar assets after Trump's tariff blitz. The single currency has surged about 10% against the dollar since its February trough, and although it has pulled back slightly since the U.S./China tariff pause, it remains elevated. This is a problem, given about 60% of revenues for companies on Europe's STOXX 600 index are generated abroad. "It's an issue for exporters. When you have tariffs and a stronger currency on top of that it becomes a double whammy," said Barclays' Chandrasekaran. "The sharp cuts (to earnings expectations) have come for the export-oriented part of the market," he added. Companies that flagged currency movements as a potential headwind in the year ahead included Europe's largest company SAP, Munich Re, Bayer, Prysmian, Unilever and L'Oreal. BANKS UNFAZED Bank earnings have largely weathered the market volatility around U.S. tariffs. Many lenders beat expectations and stuck to their 2025 forecasts – a clear departure from prevailing corporate caution. Even with pressures from moderating interest rates, their latest updates showed resilience in the face of global trade and macro uncertainties. UBS estimates nearly 90% of banks beat market consensus, largely driven by strong revenue performances. The sector trades cheaply based on various metrics, and even after a 28% surge this year, it remains in favour among investors attracted by high payouts and stronger balance sheets. According to BofA's European fund manager survey, banks reclaimed their spot as the most overweighted sector this month, with financial stocks expected to be the best performers this year. "Bank numbers are all very strong," said Carlo Franchini, head of institutional clients at Banca Ifigest. ENERGY EARNINGS DRAG Seven of the 10 major sectors tracked by LSEG I/B/E/S have seen growth in earnings relative to the first quarter of 2024, but energy is not one of them, with the sector expected to report earnings down 28% from the same period a year ago. "There's a very clear correlation between profitability and the oil price, and the oil price has come off," GSAM's Geerdink said. "It's a function of two things, lower economic activity and OPEC producing much more than anticipated." Oil prices tumbled to a four-year low last month on concerns about demand following Trump's tariffs, but have since rebounded slightly as trade tensions thawed. 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
