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Malay Mail
15-07-2025
- Business
- Malay Mail
Betting on TACO: How stock markets learned to ignore Trump's bluster amid latest tariff threats
PARIS, July 15 — When it comes to Donald Trump's repeated tariff threats and financial markets, it looks like 'TACO' is the dish investors are dining on, analysts said. The acronym — coined by a Financial Times columnist and standing for 'Trump Always Chickens Out' — has become a lodestar for equities, currencies and commodities traders, resulting in diminishing reactions to the US president's warnings. To be sure, Trump's vows of future tariff hikes still weigh on markets — just not to the extent they used to. When his 'Liberation Day' protectionist offensive was unveiled in April, the reaction was panic. Now, said analysts, traders take his tariff announcements in their stride. On Monday, stock markets largely shrugged off Trump's weekend threat to impose 30-percent tariffs on the EU. 'It's amazing in fact, the tariff rates are as high as they were announced back in April, yet the market reaction is completely different,' Ipek Ozkardeskaya, an analyst at Swissquote Bank, told AFP. 'Investors continue to bet that Trump 'will chicken out' — the so-called TACO trade — and that negotiations will extend beyond August 1st,' when the tariffs are to come into effect, she said. Despite Trump trying to raise the stakes with several tariff announcements over recent days, targeting a dozen countries and products such as copper, 'the market has increasingly overcome its queasiness', said Jim Reid, a Deutsche Bank analyst. US stock indices are hitting record highs, while European equities are also proving attractive to buyers. Germany's DAX index has risen more than 20 percent since the beginning of this year, despite the export-dependent country being among the more exposed to Trump's levies. A member of civic groups wearing a mask of US President Donald Trump performs during a protest against Trump's tariff policy near the US embassy in Seoul on July 15, 2025. — AFP pic Inured to Trump's behaviour That resilience speaks to traders becoming inured to Trump's pattern of behaviour that goes from headline threats, to delays, and then in some cases to negotiated outline deals. 'Markets aren't collapsing because they've grown conditioned to tariff threats as part of the US negotiating playbook. Investors see this more as tactical leverage than an immediate economic cliff,' Stephen Innes, managing partner at SPI Asset Management, said. When it comes to the latest threat, 'the real tell is that the EU hasn't responded with reciprocal tariffs, which suggests Brussels still thinks a negotiated outcome is possible — and that's keeping risk sentiment afloat,' he said. 'The markets expect the (EU-US) negotiations to continue,' agreed Alexandre Baradez, head of market analysis at IG France. But there is a lingering worry that Trump this time might make good on his threat. 'If huge tariffs do get imposed on August 1st, in thin holiday markets, we could get a sizeable market reaction,' said Deutsche Bank's Reid. In America, the effects of the tariffs Trump has already implemented are also being watched closely, especially for signs of spiking inflation. That, combined with lower growth, could usher in a period of stagflation, which could prevent the US central bank, the Federal Reserve, using lower interest rates to revive the economy. 'The market's reaction — or the lack thereof — increases the gap between how investors want to see the reality, and what the reality will look like,' warned Swissquote Bank's Ozkardeskaya. — AFP
Khaleej Times
14-07-2025
- Business
- Khaleej Times
Dubai: Gold prices at 3-week high, budget-conscious shoppers hold purchases
Gold prices hit a three-week high in Dubai at the start of the week due to US President Donald Trump's threat to impose 30 per cent tariffs on imports from the European Union countries and Mexico. The 24K was trading at Dh404.75 per gram at the opening of the markets in Dubai on Monday. The higher prices are prompting many budget-conscious shoppers to put off their purchases and wait for the prices to drop to a more acceptable level. Among the other precious metal variants, 22K, 21K and 18K were trading higher at Dh375.0, Dh359.5 and Dh308.25 per gram, respectively. Spot gold was trading at $3,356.66 per ounce. Ozkardeskaya, senior analyst at Swissquote Bank, said Trump continued his tariff reveals over the weekend, announcing that the EU and Mexico would be hit with 30 per cent tariffs from August 1. "That's far more than what the EU expected. They were hoping for a figure closer to what the UK secured: a 10 per cent tariff, with exceptions for key sectors like metals and pharmaceuticals. Instead, they got a big, fat 30 per cent," he said. "However, Trump did leave the door open for further negotiations and some fine-tuning, but given the level of tariffs unveiled since last week, you have to wonder whether it's worth the time and energy to negotiate with a government that appears to have lost the plot — or if it's better to pursue other deals with other nations. That's what the Europeans are now discussing: finding new friends," he added.
Business Times
09-07-2025
- Business
- Business Times
Singapore stocks extend rally on Wednesday; STI up 0.3%
[SINGAPORE] Investors stayed positive on local stocks on Wednesday (Jul 9) while bracing for the impact of US President Donald Trump's tariff shocks. The blue-chip Straits Times Index (STI) closed 0.3 per cent or 9.96 points higher at 4,057.82. Across the broader market, gainers outnumbered losers 287 to 187, with about 1.2 billion securities worth S$1.2 billion changing hands. On the STI, UOL was the top gainer, climbing 3.4 per cent or S$0.22 to S$6.61. SGX was the biggest loser, falling 1.2 per cent or S$0.18 to S$15.41. Regional bourses closed mixed. South Korea's Kospi gained 0.6 per cent and Japan's Nikkei 225 rose 0.2 per cent. However, Malaysia's KLCI was down 0.1 per cent and Hong Kong's Hang Seng Index dropped 1.1 per cent. Ipek Ozkardeskaya, senior analyst at Swissquote Bank, noted that hopes of an extension to the current tariff pause were dashed after Trump confirmed the Aug 1 deadline with no further delays. He also slapped a 50 per cent tariff on copper and threatened a 200 per cent tariff on pharmaceuticals overnight. 'Trump is sowing the seeds of higher inflation – and higher debt. To keep debt-to-GDP (gross domestic product) in check, the US would need to post strong growth, which may prove unrealistic,' said Ozkardeskaya. In this environment, she picked inflation-protecting assets, including stocks of companies that are able to pass on price increases to clients and customers, such as those in consumer staples, utilities and healthcare. 'Homebuilders could also perform well if they can raise home prices faster than input costs rise,' she added.
Business Times
09-07-2025
- Business
- Business Times
Singapore stocks extend rally; STI up 0.3%
[SINGAPORE] Investors stayed positive on local stocks on Wednesday (Jul 9) while bracing for the impact of US President Donald Trump's tariff shocks. The blue-chip Straits Times Index (STI) closed 0.3 per cent or 9.96 points higher at 4,057.82. Across the broader market, gainers outnumbered losers 287 to 187, with about 1.2 billion securities worth S$1.2 billion changing hands. On the STI, UOL was the top gainer, climbing 3.4 per cent or S$0.22 to S$6.61. SGX was the biggest loser, falling 1.2 per cent or S$0.18 to S$15.41. Regional bourses closed mixed. South Korea's Kospi gained 0.6 per cent and Japan's Nikkei 225 rose 0.2 per cent. However, Malaysia's KLCI was down 0.1 per cent and Hong Kong's Hang Seng Index dropped 1.1 per cent. Ipek Ozkardeskaya, senior analyst at Swissquote Bank, noted that hopes of an extension to the current tariff pause were dashed after Trump confirmed the Aug 1 deadline with no further delays. He also slapped a 50 per cent tariff on copper and threatened a 200 per cent tariff on pharmaceuticals overnight. 'Trump is sowing the seeds of higher inflation – and higher debt. To keep debt-to-GDP (gross domestic product) in check, the US would need to post strong growth, which may prove unrealistic,' said Ozkardeskaya. In this environment, she picked inflation-protecting assets, including stocks of companies that are able to pass on price increases to clients and customers, such as those in consumer staples, utilities and healthcare. 'Homebuilders could also perform well if they can raise home prices faster than input costs rise,' she added.
Time of India
05-07-2025
- Business
- Time of India
Dollar slips versus major currencies as US tariff deadline looms
The dollar slipped against other major currencies on Friday after President Donald Trump got his signature tax cut bill over the final hurdle and pressure mounted on countries to secure trade deals with the United States. The U.S. currency had rallied on Thursday after stronger than expected U.S. jobs data pushed out the timing for potential rate cuts by the Federal Reserve . But the dollar index, which tracks the currency against major peers, is headed for a second-straight weekly decline. The Republican-controlled House of Representatives narrowly passed Trump's "One, Big, Beautiful Bill" of spending and tax cuts that is estimated to add $3.4 trillion to the country's $36.2 trillion debt. Trump is expected to sign the bill into law on Friday. With the U.S. closed for Independence Day, attention turns to Trump's July 9 deadline when sweeping tariffs take effect on countries like Japan that have not yet secured trade agreements. "The appetite for the dollar is waning because, one, the U.S. debt worries are rising and appetite for U.S. debt is at risk," said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank. Live Events "And also because of the fact that the tariff situation and trade disruptions are going to have a negative impact on growth for the U.S. and the Fed will not necessarily be able to support the economy when inflation risks are rising." The dollar index had its worst first half since 1973 as Trump's chaotic roll-out of sweeping tariffs heightened concerns about the U.S. economy and the safety of Treasuries. The U.S. currency has fallen more than 6% since April 2, which was when the U.S. announced tariffs on the world, and had hit the lowest in more than three years against the euro and British pound earlier in the week. The dollar index edged 0.1% lower to 96.92, trimming its 0.4% advance on Thursday. The euro added 0.2% to $1.178, poised for a 0.5% weekly gain. The yen climbed 0.4% to 144.32 versus the dollar, while the Swiss franc firmed 0.2% to fetch 0.793 per dollar. TRADE CONCERNS Trump said many countries will get letters on Friday specifying what tariff rates they will face, marking a shift from earlier pledges to do individual deals with trading partners. European Commission President Ursula von der Leyen said the EU was aiming for a trade agreement "in principle" with the U.S. before the deadline. Japan, which has been a focus of Trump's ire of late, is reportedly sending its chief trade negotiator to the U.S. again as early as this weekend. Indonesia offered to cut duties on key imports from the United States to "near zero" and to buy $500 million worth of U.S. wheat. Elsewhere, China said it would implement duties of up to 34.9% on brandy originating in the European Union for a period of five years starting from July 5. In some relief for investors worried about the health of the U.S. economy, the employment report on Thursday showed that non-farm payrolls increased by 147,000 jobs in June, well ahead of economists' forecast in a Reuters poll for a rise of 110,000. "The U.S. labour market is gradually slowing down, but the fact that it hasn't experienced a sudden change is reassuring," said SMBC chief currency strategist Hirofumi Suzuki. "I personally predict that the tariff negotiations will not be very favourable, leading to continued dollar weakness and yen strength." Market expectations that the Fed will leave rates unchanged at its July meeting are now at 95.3% probability, up from 76.2% on July 2, according to the CME's Fedwatch tool. Economists continue to expect the Fed will not start cutting rates again until September or even later.
