New Tariffs to Push Inflation up 1%: BlueBay
That will prevent the Fed from cutting interest rates in coming months regardless of likely slowing in economic activity, he said.
The new measures will deliver a 10% increase 'end state' after accounting for retaliation by targeted countries and unwinds of some levies, he said.
Gross-domestic product growth will likely slow to 1.5% but the economy is unlikely to fall into recession, according to BlueBay, which is a unit of RBC Global Asset Management. The combination of higher inflation and slower growth will suppress any temporary relief from the arrival of the long-awaited tariffs, Skiba said.
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an hour ago
- Yahoo
'Tariffs are starting to bite': Latest inflation, jobs data sparks Wall Street concern over US economy
Stocks have continued to notch record highs this year as investors bet on a resilient economy and minimal fallout from tariff-driven inflation. But last week, both assumptions came under pressure. It was a packed week for economic data, offering a more nuanced and, in some cases, sobering look at the state of the US economy. The week kicked off with signs of strain in the labor market: The hiring rate fell to a seven-month low, and the quits rate, a key measure of worker confidence, dropped to just 2%. On Wednesday, GDP data showed the economy rebounded at a 3% annualized pace in the second quarter, recovering from a surprise Q1 contraction driven by a pre-tariff surge in imports. But economists cautioned that the headline growth masked underlying softness. Sales to private domestic purchasers, a key proxy for consumer and business demand, rose just 1.2%, the weakest pace since 2022. Greg Daco, chief economist at EY-Parthenon, called the rebound an "economic mirage," adding that policy uncertainty, rising inflation pressures from tariffs, and tighter immigration constraints are starting to weigh more visibly on economic activity. Then, after the Fed held interest rates steady, Thursday's release of its preferred inflation gauge, the Personal Consumption Expenditures (PCE) index, showed price increases accelerated in June as inflation remained above the Fed's 2% target. Consumer spending also showed signs of strain as real personal spending rose just 0.1% in June following a revised 0.2% drop in May. The week culminated in a disappointing July jobs report, which offered the clearest sign yet that the labor market may be cracking. The US added just 73,000 jobs, far short of the 104,000 forecast. Even more striking were sharp downward revisions to May and June, which erased a combined 258,000 jobs, the largest two-month downgrade since May 2020. Taken in totality, last week's data painted a picture of mounting economic pressure, with growing signs that households are beginning to feel the strain as the second half of the year gets underway. "Tariffs are starting to bite," EY's Daco told Yahoo Finance. "They're leading to higher inflationary pressures, which are curtailing consumer spending and prompting businesses to adopt more of a wait-and-see approach." Michael Pearce, deputy chief US economist at Oxford Economics, said the overall trend is becoming clearer: "The signs are that consumer spending is losing momentum." He added that "as real income growth wanes, we expect an increasing drag on consumer spending, particularly on discretionary purchases and goods most exposed to tariff-driven price increases." While auto sales had been front-loaded earlier this year ahead of tariff implementation, Pearce pointed to renewed declines in tariff-sensitive categories like furniture. He noted that any short-term lift from early buying is now "mostly in the rear-view mirror," and warned that consumers have yet to fully absorb the impact of tariff-driven shocks to income and purchasing power. Adding to the pressure, trade tensions escalated as President Trump raised tariff rates on several US trading partners, including a surprise 39% levy on imports from Switzerland. "There's a repeated refrain that tariffs are not having an impact, and that assessment misses the mark," Wells Fargo economists, led by Jay Bryson, said in the latest installment of Yahoo Finance's Chartbook series. "Consumer spending is not as sturdy as it was initially reported in the first quarter," the team added. "With two months of data on hand for the second quarter, it is becoming increasingly clear that households are reducing their discretionary outlays." The strain is also beginning to show in corporate earnings. "When you take a look at companies like Whirlpool, like P&G, they are being impacted by tariffs," Michael Kantrowitz, chief investment strategist at Piper Sandler, told Yahoo Finance's Opening Bid. "There seems to be a sort of bifurcation when it comes to how tariffs are impacting bottom lines. Those that are focused on products for consumers ... And then you've got other companies, like Big Tech, that is sort of immune to the tariff situation." But even Big Tech is starting to feel the squeeze. Apple (AAPL) CEO Tim Cook warned this week that the company expects a $1.1 billion tariff hit this quarter. Elsewhere, a slew of consumer-facing companies, including Shake Shack (SHAK), Canada Goose (GOOS), and snack maker Kellanova (K), have struggled this earnings season as price-sensitive shoppers pull back. With contributing reporting from Yahoo Finance's Josh Schafer. Allie Canal is a Senior Reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at
Yahoo
an hour ago
- Yahoo
'Tariffs are starting to bite': Latest inflation, jobs data sparks Wall Street concern over US economy
Stocks have continued to notch record highs this year as investors bet on a resilient economy and minimal fallout from tariff-driven inflation. But last week, both assumptions came under pressure. It was a packed week for economic data, offering a more nuanced and, in some cases, sobering look at the state of the US economy. The week kicked off with signs of strain in the labor market: The hiring rate fell to a seven-month low, and the quits rate, a key measure of worker confidence, dropped to just 2%. On Wednesday, GDP data showed the economy rebounded at a 3% annualized pace in the second quarter, recovering from a surprise Q1 contraction driven by a pre-tariff surge in imports. But economists cautioned that the headline growth masked underlying softness. Sales to private domestic purchasers, a key proxy for consumer and business demand, rose just 1.2%, the weakest pace since 2022. Greg Daco, chief economist at EY-Parthenon, called the rebound an "economic mirage," adding that policy uncertainty, rising inflation pressures from tariffs, and tighter immigration constraints are starting to weigh more visibly on economic activity. Then, after the Fed held interest rates steady, Thursday's release of its preferred inflation gauge, the Personal Consumption Expenditures (PCE) index, showed price increases accelerated in June as inflation remained above the Fed's 2% target. Consumer spending also showed signs of strain as real personal spending rose just 0.1% in June following a revised 0.2% drop in May. The week culminated in a disappointing July jobs report, which offered the clearest sign yet that the labor market may be cracking. The US added just 73,000 jobs, far short of the 104,000 forecast. Even more striking were sharp downward revisions to May and June, which erased a combined 258,000 jobs, the largest two-month downgrade since May 2020. Taken in totality, last week's data painted a picture of mounting economic pressure, with growing signs that households are beginning to feel the strain as the second half of the year gets underway. "Tariffs are starting to bite," EY's Daco told Yahoo Finance. "They're leading to higher inflationary pressures, which are curtailing consumer spending and prompting businesses to adopt more of a wait-and-see approach." Michael Pearce, deputy chief US economist at Oxford Economics, said the overall trend is becoming clearer: "The signs are that consumer spending is losing momentum." He added that "as real income growth wanes, we expect an increasing drag on consumer spending, particularly on discretionary purchases and goods most exposed to tariff-driven price increases." While auto sales had been front-loaded earlier this year ahead of tariff implementation, Pearce pointed to renewed declines in tariff-sensitive categories like furniture. He noted that any short-term lift from early buying is now "mostly in the rear-view mirror," and warned that consumers have yet to fully absorb the impact of tariff-driven shocks to income and purchasing power. Adding to the pressure, trade tensions escalated as President Trump raised tariff rates on several US trading partners, including a surprise 39% levy on imports from Switzerland. "There's a repeated refrain that tariffs are not having an impact, and that assessment misses the mark," Wells Fargo economists, led by Jay Bryson, said in the latest installment of Yahoo Finance's Chartbook series. "Consumer spending is not as sturdy as it was initially reported in the first quarter," the team added. "With two months of data on hand for the second quarter, it is becoming increasingly clear that households are reducing their discretionary outlays." The strain is also beginning to show in corporate earnings. "When you take a look at companies like Whirlpool, like P&G, they are being impacted by tariffs," Michael Kantrowitz, chief investment strategist at Piper Sandler, told Yahoo Finance's Opening Bid. "There seems to be a sort of bifurcation when it comes to how tariffs are impacting bottom lines. Those that are focused on products for consumers ... And then you've got other companies, like Big Tech, that is sort of immune to the tariff situation." But even Big Tech is starting to feel the squeeze. Apple (AAPL) CEO Tim Cook warned this week that the company expects a $1.1 billion tariff hit this quarter. Elsewhere, a slew of consumer-facing companies, including Shake Shack (SHAK), Canada Goose (GOOS), and snack maker Kellanova (K), have struggled this earnings season as price-sensitive shoppers pull back. With contributing reporting from Yahoo Finance's Josh Schafer. Allie Canal is a Senior Reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at 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
Yahoo
3 hours ago
- Yahoo
Oppenheimer Predicts Up to 590% Rally for These 2 ‘Strong Buy' Stocks
There's a lot to say about the economy and markets today. Earnings season is well underway, with 317 S&P 500 companies having reported so far, and the results have been broadly encouraging – 83% have topped profit forecasts. That strength has helped drive both the S&P 500 and NASDAQ toward record highs, although August began with a pullback as investors reacted to a weaker-than-expected jobs report and the rollout of new tariffs from President Trump. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Even with those headwinds, Oppenheimer's chief investment strategist John Stoltzfus remains optimistic about the path ahead. 'This year reminds us of the classic Charles Dickens quote, 'It was the best of times, it was the worst of times.' Although much uncertainty and worry prevailed for some time both with trade policy and geopolitical events, and given the multitude of potential outcomes, we'd note that cooler heads prevailed – leading to positive outcomes at least for now. Monetary policy by the Fed has brought down the pace of inflation (if not yet to its 2% target level) without thus far causing a recession. This in our view is a substantial achievement… We are revising our year-end price target for the S&P 500 to 7,100 from 5,950,' Stoltzfus noted. That S&P target implies a gain of ~14% from current levels, a solid gain by any standard. But some stocks are going to outperform, even substantially – and Oppenheimer analysts are predicting much stronger rallies for 2 names in particular, including one with a potential upside as high as 590%. Using the TipRanks database, we've looked at the big-picture view on both of these picks, and it seems the broader Street agrees with Oppenheimer's bullish stance – both stocks hold Strong Buy consensus ratings, with forecasts pointing to potential triple-digit gains. Let's dig into what makes these high-upside picks so compelling. Climb Bio (CLYM) We'll start with Climb Bio, a biotech research firm focused on developing new treatments for immune-mediated diseases. These conditions – affecting an estimated 1 in 7 people worldwide – often stem from malfunctioning B cells, which can mistakenly attack the body's own tissues. Climb is developing therapies that target this root cause, aiming to address a range of serious and underserved diseases. The company's pipeline includes two drug candidates: its lead program, budoprutug, is currently being tested in three clinical trials and one preclinical study, while its second candidate, CLYM116, remains in preclinical development. Budoprutug is an anti-CD19 monoclonal antibody designed to deplete B cells. The drug has shown encouraging early clinical data and is now being evaluated in clinical trials across three distinct indications: primary membranous nephropathy (pMN), immune thrombocytopenia (ITP), and systemic lupus erythematosus (SLE). In pMN, a rare autoimmune kidney disorder that causes damaging protein leakage into the urine, budoprutug is entering a Phase 2 open-label, dose-ranging trial to assess safety and efficacy. This follows positive data from a small Phase 1b study, in which 3 of 5 patients who completed all four doses achieved complete remission of proteinuria. All five patients in that study experienced rapid and sustained B-cell depletion, even at the lowest tested dose of 100 mg, and no serious drug-related adverse events were reported. Meanwhile, in ITP, Climb has received FDA clearance to begin a Phase 1b/2a study, with the trial now advancing. ITP is an autoimmune disorder in which B cells produce antibodies that target and destroy platelets. Budoprutug is being tested in this setting based on its CD19-targeting mechanism, which may offer an advantage over CD20-based therapies by depleting a broader range of B-cell populations, including plasma cells that drive the underlying disease process. The drug is also being explored in SLE, a chronic autoimmune disease that can cause widespread inflammation and tissue damage across multiple organs. A Phase 1b trial has been cleared by the FDA and is set to run at ex-U.S. sites. This open-label study is designed to assess safety, tolerability, pharmacokinetics, pharmacodynamics, and early signs of clinical efficacy. Climb's B-cell-targeted approach is supported by the well-established role these cells play in driving lupus pathogenesis. To further expand its reach, Climb is also developing a subcutaneous formulation of budoprutug, with a Phase 1 trial in healthy volunteers expected to begin by year-end. Beyond budoprutug, Climb is advancing its second candidate, CLYM116, an Fc-engineered anti-APRIL monoclonal antibody with a novel pH-dependent mechanism. Currently in preclinical development, CLYM116 is being explored as a treatment for IgA nephropathy (IgAN), a serious kidney disorder also known as Berger's disease. Climb expects to report preclinical data and submit an Investigational New Drug (IND) application or Clinical Trial Application (CTA) by year-end. With CLYM trading at $1.45, Oppenheimer analyst Leland Gershell views the stock as a high-potential opportunity, pointing to the company's advancing clinical pipeline and the therapeutic promise of budoprutug. 'We have a favorable outlook on budoprutug across its three indications in primary membranous nephropathy (pMN), immune thrombocytopenia (ITP), and systemic lupus erythematosus (SLE)… Each of these indications has clear IgG-driven pathophysiology and significant residual unmet need, despite existing first- and second-line therapies, where budoprutug has opportunity to shine above… We see $1B+ sales potential across these indications, and a subcutaneous, potentially use-at-home version offers upside optionality… With shares reflecting little credit for the company's opportunities and cash runway into 2027, we see favorable risk-reward and encourage investors to build a position. We would expect positive results in pMN to generate considerable stock upside potential,' Gershell opined. So how much upside does Gershell see overall? The analyst rates CLYM an Outperform (i.e., Buy), with a $10 price target – implying a substantial 590% surge over the next year. (To watch Gershell's track record, click here) Supporting this optimistic outlook, CLYM has 3 recent analyst reviews on record – all unanimously positive – earning the stock a Strong Buy consensus rating. With an average price target of $9, analysts expect shares to be changing hands at ~521% premium over the next 12 months. (See CLYM stock forecast) Wave Life Sciences (WVE) The next Oppenheimer pick is Wave Life Sciences, a biotech company developing a lineup of RNA medicines through its proprietary platform, dubbed PRISM. RNA therapeutics represent a fast-growing frontier in biotechnology, and Wave is harnessing innovations in chemistry and human genetics to create targeted treatments for serious, genetically driven diseases that have historically lacked effective solutions. This ambitious vision is translating into a diverse clinical pipeline. Wave is advancing four distinct programs, each built on a separate RNA modality: WVE-006 uses RNA editing, WVE-007 employs RNA interference (RNAi), WVE-N531 leverages exon skipping, and WVE-003 utilizes allele-selective silencing. By tackling different mechanisms and indications, the company is positioning itself to address multiple areas of high unmet medical need. WVE-006 is a GalNAc-conjugated, subcutaneously delivered RNA editing oligonucleotide (AIMer) designed to treat alpha-1 antitrypsin deficiency (AATD), a genetic disorder affecting the lungs and liver. The drug is currently in the Phase 1b/2a RestorAATion-2 trial, with key clinical data from both the 200 mg single and multidose cohorts expected in the third quarter of 2025. Additional results from the 400 mg single-dose cohort are anticipated later this fall. Progress is also accelerating with WVE-007, an RNAi therapy targeting obesity. This GalNAc-siRNA candidate works by silencing the INHBE gene and has shown strong preclinical efficacy in reducing weight while preserving muscle mass. Following promising initial safety and pharmacodynamic results in Cohort 1, Wave expanded enrollment in Cohort 2 and expects data from the first two cohorts in Q4 2025, with high-dose cohort results to follow in early 2026. The third program, WVE-N531, is an exon-skipping oligonucleotide developed for Duchenne muscular dystrophy (DMD), a severe and progressive neuromuscular disorder. In a Phase 2 open-label trial, the therapy showed statistically significant and clinically meaningful improvements in Time-to-Rise, a key measure of functional strength. Wave plans to submit a New Drug Application (NDA) in 2026 to pursue accelerated approval. Rounding out the clinical pipeline is WVE-003, an allele-selective oligonucleotide designed for Huntington's disease (HD). This first-in-class candidate has demonstrated selective reduction of mutant huntingtin protein (mHTT) while preserving healthy wild-type HTT – an approach believed to protect neuronal function. A Phase 2/3 trial is in planning, with Wave aiming to submit an IND in the second half of 2025. This pipeline, and its potential for success, has caught the attention of Oppenheimer analyst Cheng Li, who writes: 'We think RNA medicine is poised to become an important therapeutic modality for future medicine, leveraging its unique target engagement mechanism compared to other modalities. The PRISM platform further enhances the potency, durability, tissue distribution, and pharmacological properties of oligonucleotides in a multimodal fashion… We are optimistic about WVE's four clinical programs, each having its own merits and collectively providing validation to the platform technology that propels a next wave of programs for high-value targets with differentiated approaches… We anticipate multiple meaningful clinical catalysts from WVE-006 for alpha1 antitrypsin deficiency (AATD) and WVE-007 for obesity, with current valuation offering a favorable risk/reward setup.' Reflecting this conviction, Li assigns WVE an Outperform (i.e., Buy) rating, along with a $24 price target that suggests shares could surge 178% over the next year. (To watch Li's track record, click here) Li's bullish stance is echoed across the Street. The stock has picked up 12 recent analyst reviews, supporting a Strong Buy consensus rating, with an 11-to-1 split favoring Buys over Holds. Shares currently trade at $8.63, and the average price target of $18.18 points to a potential upside of ~111% over the next 12 months. (See WVE stock forecast) To find good ideas for stocks trading at attractive valuations, visit TipRanks' Best Stocks to Buy, a tool that unites all of TipRanks' equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment. Disclaimer & DisclosureReport an Issue 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
