Latest News from CNBC
CNBC
42 minutes ago
- Business
- CNBC
European shares set to open sharply higher as U.S. judges put a halt to Trump's reciprocal tariffs
The U.S. Court of International Trade on Wednesday blocked steep reciprocal tariffs unilaterally imposed by President Donald Trump on scores of countries in April to correct what he said were persistent trade imbalances. The ruling deals a potentially serious blow to the Republican president's economic agenda and ongoing efforts to negotiate trade deals with various nations. Read the full story here. — Christina Wilkie, Erin Doherty, Lora Kolodny, Kevin Breuninger Good morning from London. It's just over an hour until European financial markets open, and equities listed in the region look set to move higher when trade kicks off. Futures tied to the German DAX index were last seen trading 1.2% higher, while FTSE 100 futures gained 0.8% and those tied to France's CAC 40 were up by 0.2%. Pan-European Stoxx 600 futures have jumped 1.3%. The moves come after the U.S. Court of International Trade on Wednesday blocked President Donald Trump from imposing his swathe of country specific tariffs — policies that could see some countries soon hit with import duties exceeding 40%. — Chloe Taylor
CNBC
an hour ago
- Business
- CNBC
Gulf-Asia ties in focus at Tadawul Capital Market Forum in Hong Kong
Gulf-Asia ties are in focus at Tadawul Capital Market Forum in Hong Kong. CNBC's Emily Tan reports.
CNBC
an hour ago
- Business
- CNBC
Dollar surges after U.S. court blocks Trump's tariffs
The U.S. dollar rallied on Thursday in knee-jerk reaction to a court blocking President Donald Trump from imposing his import tariffs on other countries, providing some relief for the currency that has struggled this year due to trade uncertainty. The Manhattan-based Court of International Trade said the U.S. Constitution gives Congress exclusive authority to regulate commerce with other countries that is not overridden by the president's emergency powers to safeguard the U.S. economy. In response, the Trump administration filed an appeal within minutes. "It's almost impossible to know if the tariffs will be completely unwound by this. But in the hypothetical situation that they are, it's natural to see dollar appreciation," said Yunosuke Ikeda, head of macro research at Nomura in Tokyo. "Trump's tariffs will lead to stagflation pressure on the U.S. economy, so reversing those tariffs would be a positive for the dollar." U.S. assets including the dollar, equities and longer-dated Treasury bonds have witnessed sharp declines in recent months as investors reassessed historic assumptions around the strength and outperformance of U.S. markets as Trump's erratic trade and tax policies sap confidence and spur inflation. On Thursday, the dollar reversed some of those moves and rose 0.72% against the yen to 145.86 and 0.63% against the Swiss franc to 0.8326. The euro slid 0.42% to $1.1245 and sterling fell 0.30% to $1.3432. That left the dollar index, which measures the U.S. currency against six major peers, back above 100 for the first time in a week. The index, though, is down 8% this year and analysts remain skeptical of a sustained dollar rally and expect a long court battle over tariffs. "There's an initial reaction of a stronger dollar and weaker yen. However, considering judicial processes like appeals, I don't expect a continuous rise in the dollar," said Hirofumi Suzuki, chief FX strategist at SMBC. The greenback has weakened about 2% against the Japanese yen, nearly 6% against the Swiss franc and 4% against the euro since Trump slapped harsh levies on global economies on April 2, while the broader dollar index has fallen more than 3%. "The markets are buying back the dollar on the news, rather than selling the yen," said Tohru Sasaki, chief strategist at Fukuoka Financial Group. "But if the dollar continued to rise to above 148 yen, speculative short yen positions may be forced to unwind, causing the dollar-yen pair to rise even more," he said. U.S. stock futures and Asian bourses jumped on a risk-on rally. Traders also cut their expectations for interest rate cuts by the Federal Reserve to 42 basis points of easing compared to 50 basis points earlier in the week, LSEG data showed. Investor focus this month has been on the bond market, with lackluster demand for longer-dated debt globally drawing attention to worsening government deficits. Traders are also watching progress of a budget and spending bill in the U.S. Congress that is expected to add trillions of dollars of debt. But sentiment about the U.S. economy has improved after Trump delayed on the weekend a plan to impose 50% tariffs on European Union imports and investors are on the lookout for any signs of improving relations between the United States and its trade partners.
CNBC
an hour ago
- Business
- CNBC
Oil prices climb as U.S. court blocks Trump tariffs
Oil prices rose on Thursday after a U.S. court blocked President Donald Trump's tariffs from taking effect, while the market was watching out for potential new U.S. sanctions curbing Russian crude flows and an OPEC+ decision on hiking output in July. Brent crude futures climbed 81 cents, or 1.25%, to $65.71 a barrel. U.S. West Texas Intermediate crude advanced by 83 cents, or 1.34%, to $62.62 a barrel at 0102 GMT. A U.S. trade court on Wednesday ruled that Trump overstepped his authority by imposing across-the-board tariffs on imports from nations that sell more to the United States than they buy. The ruling buoyed risk appetite across global markets which have been on edge about the impact of the levies on economic growth, but analysts said the relief may only be temporary given the administration has said it will appeal. "But for now, investors get a breather from the economic uncertainty they love to loathe," said Matt Simpson, an analyst at City Index in Brisbane. On the supply front, there are concerns about potential new sanctions on Russian crude. At the same time, the Organization of the Petroleum Exporting Countries and allies, together called OPEC+, could agree on Saturday to accelerate their oil production hikes in July. With Russian oil so far overall showing relative resistance to the sanctions, imposed over Moscow's war on Ukraine, "it is hard to be convinced that any new U.S. sanctions on Russia will meaningfully dent Russia's oil exports," Commonwealth Bank of Australia analyst Vivek Dhar said in a note. Adding to supply risks, Chevron has terminated its oil production and a number of other activities in Venezuela, after its key license was revoked by U.S. President Donald Trump's government in March. Venezuela in April cancelled cargoes scheduled to Chevron citing payment uncertainties related to U.S. sanctions. Chevron was exporting 290,000 barrels per day (bpd) of Venezuelan oil or over a third of the country's total before that. "From May through August, the data points to a constructive, bullish bias with liquids demand set to outpace supply," Mukesh Sahdev, Global Head of Commodity Markets at Rystad Energy, said in a note, as he expects demand growth outpacing supply growth by 0.6 million to 0.7 million bpd. Later on Thursday, investors will be watching for the weekly reports from the American Petroleum Institute (API) and the Energy Information Administration, the statistical arm of the U.S. Department of Energy. U.S. crude oil and distillate inventories likely rose last week while gasoline stockpiles likely fell, an extended Reuters poll showed on Wednesday. According to the market sources familiar with the API data, U.S. crude and gasoline stocks fell last week while distillate inventories rose.
CNBC
2 hours ago
- Automotive
- CNBC
German defense firm Renk looks to struggling auto sector for new talent as it scales up
Tank parts maker Renk is eyeing up talent from the auto sector as it races to scale up and fuel growth in the wake of rising geopolitical tensions and soaring military spending. Earlier this year Germany passed a historic fiscal package that enabled a steep increase in the defense spending capabilities of Europe's largest economy. The 27-member state bloc is scaling up its defense efforts amid the war in Ukraine and the increasingly strained transatlantic security partnership. Renk, a global leader in creating gear boxes for tanks, is among the defense firms that has seen its stock rally on the back of increased military spending. Its share price rose over 300% so far this year and its order book jumped 164% to 549 million euros ($622.3 million) in the first quarter. To keep pace with the soaring demand, defense companies like Renk, Hensoldt, Rheinmetall are increasingly collaborating with the automotive industry. It's a sector which historically has been one of Germany's most important economic pillars, but has been facing major difficulties due to the country's sluggish economy, increased competition from China and U.S. tariffs. For Renk, this cross-industry collaboration has mainly consisted of hiring workers from the automotive industry, capitalizing on CEO Alexander Sagel and Chief Operating Officer Emmerich Schiller's previous experience working in this sector. Sagel has previously held positions at Rheinmetall and Daimler, which has since been renamed to Mercedes-Benz Group AG, while Schiller has worked in various management roles at Mercedes-AMG GmbH. In an exclusive interview from Renk's headquarters in Augsburg, Germany, CEO Sagel told CNBC's Annette Weisbach that the tank-parts supplier has seen a range of applicants from the automotive industry and is "of course" benefitting from incorporating such experts. Schiller confirmed the trend, adding, "We are looking really for engineers who have that education, who can adapt to our industry and bring in the methods which we have in automotive like continuous improvement, like lineback principles to increase efficiency — to increase quality, this is what we are really looking for." A branch of Germany's largest trade union, IG Metall Lower Saxony, told CNBC it has seen cases of defense firms targeting skilled workers and collaborative opportunities with German carmakers and manufacturers. "These developments are taking place against the backdrop of two parallel dynamics: The automotive industry is undergoing a profound transformation process – key words [are]: electrification, digitalization, new mobility concepts – while at the same time the defense-related sector is expanding due to political decisions and increased defense budgets," a spokesperson from IG Metall Lower Saxony said, in emailed comments translated by CNBC. While there are technological connections between the two industries and job creation is welcome, IG Metall warns of a "one-sided industrial policy focus towards rearmament," which may provide employment in the short term but is based on an unstable security environment. "Our goal has to be a lasting peace, not continuous rearmament," the spokesperson said. In a Deutsche Bank note from March, analysts led by Adrian Cox explained that overcapacity is an issue across Europe's auto industry, particularly in Germany, where they estimate 100,000 jobs are now be at risk. Auto factories are lying idle while the defense sector remains "subscale," the analysts said, adding that experienced auto workers can benefit the defense industry as it "moves to serial production and greater profitability." There is "a historic opportunity to kill two birds with one stone by turning some of [Germany's] automaking prowess to military production," the analysts commented. "The German automotive industry is now increasingly talking to adjacent sectors," a spokesperson from the German Association of the Automotive Industry (VDA) told CNBC. "In contrast to industry, Germany is no longer internationally competitive as a business location," they said, adding that they "welcome anything that upgrades Germany as a production location in order to maintain and create growth, prosperity and jobs in Germany." When asked about the shifts from automotives to defense, Monika Schnitzer, the chair of the German Council of Economic Experts, told CNBC's Squawk Box Europe on Tuesday that it's a chance "we should seize." Given the guarantee that auto industry layoffs will happen, these workers "will be needed somewhere else" and therefore it'll be key "to ease this transition by actually bringing people from one company to another company where they are needed" and also foster reskilling, she added.
