Latest news with #SiddarthS
RNZ News
03-05-2025
- Business
- RNZ News
US economy risks losing billions as travel demand weakens, analysts warn
By Siddarth S , Reuters Last month Delta Air Lines, a major international carrier, warned travel demand had "largely stalled", scrapping its forecasts for the year. Photo: 123RF Weakening travel demand, signalled by grim earnings forecasts of travel-related companies, may erase billions of dollars from the US economy this year as the Trump administration's trade policy takes a toll on consumer sentiment, analysts have warned. "Anti-American sentiment could be driving a decline in international tourism, which is considered a service export," JP Morgan said in a note last week. Goldman Sachs and JP Morgan projected lower foreign travel spending to trim 0.1 percent from US GDP this year, adding that the hit could be as much as 0.2 percent to 0.3 percent. As of the first quarter of 2025, US GDP stands at US$23.53 trillion (NZ$39.5 trillion), according to LSEG data, and the impact could amount to anywhere between US$23 billion and $71 billion, based on Reuters calculations. Last month Delta Air Lines, a major international carrier, warned travel demand had "largely stalled", scrapping its forecasts for the year. Southwest Airlines, American Airlines, Alaska Air and Frontier pulled their guidance, while United Airlines gave two different forecasts as the trade war created the biggest uncertainty for the industry since the Covid-19 pandemic. Vacation rental platform Airbnb forecast second-quarter revenue largely below Wall Street estimates, while hotel operator Hilton indicated travellers were in a "wait-and-see" mode. "Tariff announcements and a more aggressive stance toward historical allies have hurt global opinions about the United States. "The bigger issue is a pullback in tourist visits to the US," Goldman Sachs said in March, at a time when Europeans were already booking fewer trips to the country. President Donald Trump's erratic tariffs have also led to global consumers boycotting and ditching US products and brands. Spending by foreign travellers and tourists in 2024 accounted for 0.7 percent, or $215 billion, of US GDP, according to J P Morgan estimates. A 10 percent reduction in spending is a direct 7-basis point hit to US GDP, the brokerage added. President Donald Trump's erratic tariffs have also led to global consumers boycotting and ditching US products and brands. Photo: AFP / Andrew Caballero-Reynolds Americans have also been wary about non-essential spending as household budgets get squeezed amid worries of a probable recession brought on by the fluctuating trade policies. The US travel and tourism industry accounted for about 3 percent of GDP and more than six million jobs in 2023, according to the Bureau of Economic Analysis. Following a strong run in 2023 and 2024, this year has had a slow start, with Bank of America-aggregated card data showing softer lodging, tourism and airline spending through the week ending March 22. Earlier this week, data showed, the US economy contracted for the first time in three years in the first quarter, while consumer sentiment remained weak in April. - Reuters
Yahoo
02-05-2025
- Business
- Yahoo
US economy risks losing billions as travel demand weakens, analysts warn
By Siddarth S (Reuters) -Weakening travel demand, signaled by grim earnings forecasts of travel-related companies, may erase billions of dollars from the U.S. economy this year as the Trump administration's trade policy takes a toll on consumer sentiment, analysts have warned. "Anti-American sentiment could be driving a decline in international tourism, which is considered a service export," said in a note last week. Goldman Sachs and projected lower foreign travel spending to trim 0.1% from U.S. GDP this year, adding that the hit could be as much as 0.2% to 0.3%. As of the first quarter of 2025, U.S. GDP stands at $23.53 trillion, according to LSEG data, and the impact could amount to anywhere between $23 billion and $71 billion, based on Reuters calculations. Last month, Delta Air Lines, a major international carrier, warned travel demand has "largely stalled," scrapping its forecasts for the year. Southwest Airlines, American Airlines, Alaska Air and Frontier pulled their guidance, while United Airlines gave two different forecasts as the trade war creates the biggest uncertainty for the industry since the COVID-19 pandemic. Vacation rental platform Airbnb forecast second-quarter revenue largely below Wall Street estimates, while hotel operator Hilton indicated travelers were in a "wait-and-see" mode. "Tariff announcements and a more aggressive stance toward historical allies have hurt global opinions about the United States. The bigger issue is a pullback in tourist visits to the U.S.," Goldman Sachs said in March, at a time when Europeans were already booking fewer trips to the country. President Donald Trump's erratic tariffs have also led to global consumers boycotting and ditching U.S. products and brands. Spending by foreign travelers and tourists in 2024 accounted for 0.7%, or $215 billion, of U.S. GDP, according to estimates. A 10% reduction in spending is a direct 7-basis point hit to U.S. GDP, the brokerage added. DOMESTIC PULLBACK Americans have also been wary about non-essential spending as household budgets get squeezed amid worries of a probable recession brought on by the fluctuating trade policies. The U.S. travel and tourism industry accounted for about 3% of GDP and more than six million jobs in 2023, according to the Bureau of Economic Analysis. Following a strong run in 2023 and 2024, this year has had a slow start, with Bank of America-aggregated card data showing softer lodging, tourism and airline spending through the week ending March 22. Earlier this week, data showed, the U.S. economy contracted for the first time in three years in the first quarter, while consumer sentiment remained weak in April. Sign in to access your portfolio
Time of India
22-04-2025
- Business
- Time of India
Nvidia-backed CoreWeave gets largely bullish coverage from brokerages
By Joel Jose and Siddarth S Wall Street brokerages on Tuesday began coverage of Nvidia-backed CoreWeave with broadly bullish views, although the stock has failed to gain traction with investors following a lackluster initial public offering and market debut. Among the five major brokerages covering CoreWeave's shares, Goldman Sachs set the highest price target at $54, while had the lowest at $43. The stock, which was priced at $40 in its IPO, is currently trading at $36.25. After the expiration of the industry-required quiet period, the brokerages started coverage of the stock, citing the company's strong foothold in the booming AI infrastructure market for their bullish stance. "CoreWeave exhibits a track record of being first to deploy next-gen GPUs, making it difficult for other hyperscalers to claim industry leadership," said. Livingston, New Jersey-based CoreWeave offers access to data centers and high-powered Nvidia chips, which are highly coveted in the competitive AI development landscape. However, they also expressed caution about its over-reliance on some of its customers and a tough market backdrop. "Volatile macro (and equities) backdrop may limit investors' willingness," said Morgan Stanley, as it started coverage with an "equal-weight" rating. Last year, CoreWeave - whose 32 data centers house over 250,000 GPUs, mainly supplied by Nvidia - generated 77% of its revenue from just its top two clients, one of which was Microsoft . Ahead of its IPO, CoreWeave inked a blockbuster $11.9 billion, five-year deal with OpenAI , Reuters reported last month, forging an alliance with the industry's top startup. "Close relationship with Microsoft and OpenAI could cut both ways ... and the customer concentration here does pose a risk," Barclays said. "We expect the stock to provide a wild, lumpy, volatile ride, requiring a risk tolerance that may not exist for most investors," said, warning that the firm's debt-fueled, capital-intensive business could pose risks. The IPO was underwritten by a syndicate of 18 banks, led by Morgan Stanley, and Goldman Sachs and was seen as a pivotal gauge of investor enthusiasm for new listings and AI-related stocks, especially in light of China's DeepSeek launch.
Yahoo
22-04-2025
- Business
- Yahoo
Nvidia-backed CoreWeave gets largely bullish coverage from brokerages
By Joel Jose and Siddarth S (Reuters) - Wall Street brokerages on Tuesday began coverage of Nvidia-backed CoreWeave with broadly bullish views, although the stock has failed to gain traction with investors following a lackluster initial public offering and market debut. Among the five major brokerages covering CoreWeave's shares, Goldman Sachs set the highest price target at $54, while had the lowest at $43. The stock, which was priced at $40 in its IPO, is currently trading at $36.25. After the expiration of the industry-required quiet period, the brokerages started coverage of the stock, citing the company's strong foothold in the booming AI infrastructure market for their bullish stance. "CoreWeave exhibits a track record of being first to deploy next-gen GPUs, making it difficult for other hyperscalers to claim industry leadership," said. Livingston, New Jersey-based CoreWeave offers access to data centers and high-powered Nvidia chips, which are highly coveted in the competitive AI development landscape. However, they also expressed caution about its over-reliance on some of its customers and a tough market backdrop. "Volatile macro (and equities) backdrop may limit investors' willingness," said Morgan Stanley, as it started coverage with an "equal-weight" rating. Last year, CoreWeave - whose 32 data centers house over 250,000 GPUs, mainly supplied by Nvidia - generated 77% of its revenue from just its top two clients, one of which was Microsoft. Ahead of its IPO, CoreWeave inked a blockbuster $11.9 billion, five-year deal with OpenAI, Reuters reported last month, forging an alliance with the industry's top startup. "Close relationship with Microsoft and OpenAI could cut both ways ... and the customer concentration here does pose a risk," Barclays said. "We expect the stock to provide a wild, lumpy, volatile ride, requiring a risk tolerance that may not exist for most investors," said, warning that the firm's debt-fueled, capital-intensive business could pose risks. The IPO was underwritten by a syndicate of 18 banks, led by Morgan Stanley, and Goldman Sachs and was seen as a pivotal gauge of investor enthusiasm for new listings and AI-related stocks, especially in light of China's DeepSeek launch. Following are the ratings and price targets for CoreWeave from some of the major brokerages: Brokerage Rating Price Target Jefferies Buy $51 Overweight $43 Barclays Overweight $48 Morgan Stanley Equal-weight $46 Goldman Sachs Neutral $54
