Deutsche Bank's Raab on Markets' Response to Trade Talks
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
12 minutes ago
- Yahoo
EU-US trade deals buoy stocks while Tesla plummets
Stock markets mostly bumped upwards Thursday as hopes grew that the European Union could strike a trade deal with the United States, while Tesla shares nosedived on poor earnings results. Investors have profited in recent weeks from wagers that governments will eventually hammer out pacts with Donald Trump ahead of the US president's looming August 1 deadline to avoid steeper levies. analyst Patrick O'Hare said Trump's Tuesday trade announcement with Japan had raised hopes about further agreements. "There is underlying enthusiasm for more trade deals being struck before the August 1 deadline," O'Hare said. This was boosted further by "optimism surrounding trade talks between the US and EU", said Joshua Mahony, chief market analyst at Rostro trading group. On Wall Street, both the S&P 500 and tech-heavy Nasdaq edged higher in the morning's trading, although the Dow slid lower as investors digested mixed company earnings. Google parent Alphabet was among the early gainers, rising about three percent after reporting a whopping $28.2 billion in second-quarter profits as it touted its artificial intelligence offerings. But Tesla fell around nine percent as CEO Elon Musk warned investors of a rough patch for earnings after the electric car maker reported a 16-percent drop in quarterly profits. A survey of US manufacturers released Thursday showed business confidence in the world's top economy also deteriorated in July for the second month running. "Companies cite ongoing concerns over the impact of government policies, notably in terms of both tariffs and cuts to federal spending," said Chris Williamson, Chief Business Economist at S&P Global Market Intelligence. In Europe, London's FTSE 100 gained 0.9 percent at the close, lifted by a stream of robust earnings, including from consumer goods group Reckitt, mobile phone giant Vodafone and Lloyds bank. Paris fell, dragged down by a drop in luxury stocks and disappointing profits from fossil fuel giant TotalEnergies. Yet most other European stocks markets including Frankfurt rose, as the European Union and Washington appeared close to a deal that would halve a threatened 30-percent levy on EU goods to 15 percent. A European Commission spokesman said Thursday that he believed a trade deal with the US is "within reach". According to multiple diplomats, the deal could waive tariffs on aircraft, lumber, pharmaceutical products and agricultural goods. The bloc, however, is still forging ahead with contingency plans in case talks fail, with member states approving a 93-billion-euro ($109-billion) package of counter-tariffs on US goods. Meanwhile, the European Central Bank left interest rates unchanged, as widely expected. It warned that the economic environment remained "exceptionally uncertain, especially because of trade disputes" as higher US tariffs hang in the balance. The euro dipped a touch following Thursday's rate decision, but it did perk up after ECB President Christine Lagarde said the central bank was monitoring the dollar-euro exchange rate but had no target. The euro has surged almost 14 percent against the dollar since the start of the year, boosted by investors dumping US assets in the face of Trump's impetuous policymaking and attacks on the US Federal Reserve. The euro's appreciation helps contain inflation but could harm European exports and thus slow already sluggish economic growth. In Asia, stocks advanced with Tokyo adding more than one percent, building on a more than three percent surge Wednesday on the back of the Japan-US trade deal. Hong Kong and Shanghai also rose. - Key figures at around 1530 GMT - New York - Dow: DOWN 0.4 percent at 44,851,07 points New York - S&P 500: UP 0.3 percent at 6,375.34 New York - Nasdaq Composite: UP 0.3 percent at 21,075.70 London - FTSE 100: UP 0.9 percent at 9,138.37 (close) Paris - CAC 40: DOWN 0.4 percent at 7,818.28 (close) Frankfurt - DAX: UP 0.2 percent at 24,295.93 (close) Tokyo - Nikkei 225: UP 1.6 percent at 41,826.34 (close) Hong Kong - Hang Seng Index: UP 0.5 percent at 25,667.18 (close) Shanghai - Composite: UP 0.7 percent at 3,605.73 (close) Dollar/yen: UP at 146.79 yen from 146.47 yen on Wednesday Euro/dollar: DOWN at $1.1774 from $1.1777 Pound/dollar: DOWN at $1.3537 from $1.3579 Euro/pound: UP at 86.98 pence from 86.68 pence West Texas Intermediate: UP 1.3 percent at $66.09 per barrel Brent North Sea Crude: UP 1.1 percent at $69.26 per barrel burs-sbk/rl Sign in to access your portfolio
USA Today
14 minutes ago
- USA Today
TACO or tariffs? Trump's big trade deadline is coming. Here's what to expect
If Trump holds firm to his third deadline, a slew of countries will face steep levies, including a 50% tariff on imports from Brazil and a 30% tariff on the European Union. Standing in the Rose Garden and holding a giant chart, President Donald Trump, who likes to call himself 'Tariff Man' showed off the 'reciprocal' tariffs he was planning to levy on dozens of countries. That was April 2, christened 'Liberation Day' by Trump. Almost four months and two extensions later, a new Aug. 1 deadline is looming. A slew of countries will face steep tariffs − including a 50% tariff on imports from Brazil and a 30% tariff on the European Union. A baseline tariff of 10% remains for all countries. 'We'll have a straight, simple tariff of anywhere between 15% and 50%," Trump said during an AI summit in Washington, on July 23. "We have 50 (percent) because we haven't been getting along with those countries too well." Are new tariffs really coming? Will there be another extension? Trump has said no. But Treasury Secretary Scott Bessent recently left the door open for a third reprieve. The first deadline, on April 9, was paused for 90 days − until July 9 − after it caused significant turbulence in the financial markets and economists warned of a potential recession. "I thought that people were jumping a little bit out of line," Trump said on April 9. 'They were getting yippy, you know. They were getting a little bit yippy, a little bit afraid." Trump's shifting on the deadlines also gave birth to an acronym: TACO, for Trump Always Chickens Out, mocking his on-again-off-again tariff policies. A pause – then a tariff storm On July 7, two days before the new tariffs were to go into effect, Trump extended the deadline to Aug. 1, saying several countries were negotiating deals. Trump also began sending letters on July 7 to countries letting them know of the new, updated tariffs that would be imposed on them. The first batch of 14 letters to countries including South Africa and Malaysia also made clear that if they retaliated against the United States with their own tariffs, their target tariffs would go even higher. On July 9, he sent tariff letters to another eight countries, including Brazil. So far, the United States has sent 25 tariff letters, White House Press Secretary Karoline Leavitt said on July 23. What trade deals have been struck so far? While the U.K. was the first country to reach a trade agreement with the United States, the latest and the most significant deal so far has been with Japan, Washington's fifth-largest trading partner. Other countries with whom Trump announced deals in recent months include Indonesia, Vietnam and the Philippines. On July 22, Trump announced a 'massive deal' with Japan under which the United States would impose a 15% tariff on Japanese imports. Trump had previously threatened a 24% tariff on Japan. He also wrote said Japan would invest $550 billion in the United States and that the United States would receive 90% of the profits, without offering any details. His announcement also said Japan had agreed to open up to imports of vehicles, rice and other agricultural products from the United States. Of the five countries that the United States has struck trade deals with, it only runs a trade surplus with the U.K. TACO time? On July 21, in an interview with CNBC, Bessent was noncommittal on whether there could be an extension for countries negotiating in good faith. 'We'll see what the president wants to do,' Bessent said. He added that reverting to the steep tariffs that were first proposed after the deadline might force countries to come up favorable terms. 'But again, if we somehow boomerang back ... I would think that a higher tariff level will put more pressure on those countries to come with better agreements,' said Bessent. Meanwhile Trump has repeatedly said there will be 'no change' in the deadline. 'In other words, all money will be due and payable starting AUGUST 1, 2025 − No extensions will be granted,' he wrote on Truth Social on July 8. What's happening with tariffs on Canada, Mexico and China? Trump threatened a 25% tariff on imports from Mexico and Canada shortly after his election victory. Ten days after taking office, Trump went after the top three trading partners of the United States with an executive order imposing 25% tariffs on nearly all goods from Canada and Mexico. Trump said it was to force the countries to stem the flow of migrants and fentanyl across the United States border. Meanwhile, China was hit with a 10% tariff. Canada and Mexico immediately responded with retaliatory tariffs of their own. Two days later, Trump agreed to a 30-day pause. In March, Trump waived tariffs on goods compliant with the United State-Mexico-Canada Agreement (USMC) and the imposed 25% universal tariffs on steel, aluminum and automotive imports, including those from Mexico and Canada. Tariffs on steel, aluminum and copper were raised in June to 50% − Canada is the biggest supplier of steel and aluminum to the United States − while the tariffs on automotive imports held steady. Trump sent a letter to Canadian Prime Minister Mark Carney in July saying he planned to impose 35% tariffs across-the-board on imports from Canada come Aug. 1. Trump said fentanyl was "hardly the only" challenge United States had with Canada and that its trade barriers and non-tariff polices were causing "unsustainable" trade deficits. "Canada charges extraordinary Tariffs to our Dairy farmers – up to 400% - and that is even assuming our Dairy Farmers even have access to sell their products to the people of Canada," Trump said in the letter. In a letter to Mexican President Claudia Sheinbaum, Trump said that the country had helped in 'securing the border.' But he said Mexico had 'still not stopped the Cartels who are trying to turn all of North America into a Narco-Trafficking Playground.' After months of tit-for-tat tariffs and trade war with China, which saw the U.S. tariffs spiking to 145% and Chinese tariffs on U.S. goods reaching 125%, the two called a truce in May, agreeing to a 90-day suspension of the levies, set to expire on Aug 12. On June 11, Trump announced a deal had been 'done' subject to 'final approval' by both leaders. He said the U.S. tariffs would be set at 55% on imported Chinese goods while China's tariffs remain at 10%. Bessent, who is scheduled to meet his Chinese counterpart on July 28 in Stockholm, Sweden, indicated the deadline was likely to be moved. 'We'll be working out what is likely an extension' Bessent told Fox Business on July 22. Swapna Venugopal Ramaswamy is a White House correspondent for USA TODAY. You can follow her on X @SwapnaVenugopal
Los Angeles Times
14 minutes ago
- Los Angeles Times
Europe and China agree to take action on climate change and nothing else in tense Beijing summit
BEIJING — China and the European Union have issued a joint call to action on climate change during an otherwise tense bilateral summit in Beijing on Thursday riven with major disagreements over trade and the war in Ukraine. The two economic juggernauts issued a joint statement on climate change, urging more emission cuts and greater use of green technology and affirming their support for the Paris Climate Agreement as well as calling for strong action at the upcoming COP30 climate summit in Brazil. 'In the fluid and turbulent international situation today, it is crucial that all countries, notably the major economies, maintain policy continuity and stability and step up efforts to address climate change,' the joint statement said. Their climate agreement was a silver lining on a stormy day where European leaders demanded a more balanced relationship with China in talks with President Xi Jinping. They highlighted trade in their opening remarks, calling for concrete progress to address Europe's yawning trade deficit with China. 'As our cooperation has deepened, so have the imbalances,' European Commission President Ursula von der Leyen said. 'We have reached an inflection point. Rebalancing our bilateral relation is essential. Because to be sustainable, relations need to be mutually beneficial.' Expectations were low ahead of the talks, initially supposed to last two days but scaled back to one. They come amid financial uncertainty around the world, wars in the Middle East and Ukraine, and the threat of U.S. tariffs. Neither the EU nor China is likely to budge on key issues. European Council President António Costa called on China to use its influence over Russia to bring an end to the war in Ukraine — a long-running plea from European leaders that is likely to fall again on deaf ears. Xi called for deeper cooperation between China and Europe to provide stability in an increasingly complex world. Both sides should set aside differences and seek common ground, he said, a phrase he often uses in relationships like the one with the EU. China is willing to strengthen coordination on climate and make greater contributions to addressing climate change, he said, but he pushed back against EU restrictions on Chinese exports. 'We hope the EU will keep its trade and investment markets open, refrain from using restrictive economic and trade tools and provide a good business environment for Chinese companies to invest and develop in Europe,' he said, according to a readout posted online by state broadcaster CCTV. Besides trade and the Ukraine war, von der Leyen and Costa were expected to raise concerns about Chinese cyberattacks and espionage, its restrictions on the export of rare earth minerals and its human rights record in Tibet, Hong Kong and Xinjiang. The EU, meanwhile, has concerns about a looming trade battle with the United States. 'Europe is being very careful not to antagonize President Trump even further by looking maybe too close to China, so all of that doesn't make this summit easier,' said Fabian Zuleeg, chief economist of the European Policy Center. 'It will be very hard to achieve something concrete.' China's stance has hardened on the EU, despite a few olive branches, like the suspension of sanctions on European lawmakers who criticized Beijing's human rights record in Xinjiang province, where it is accused of a widespread campaign of repression against the Uyghurs. The summit ended with almost no movement on the major issues of trade, electric vehicles, or Russia, said Noah Barkin, an analyst at the Rhodium Group think tank. Rather, frustration from the EU was glaringly obvious 'after years in which its concerns have been largely ignored by Beijing.' He said the Europeans will likely use more 'trade defense tools in the months ahead, including a debate over expanding safeguards and new cases under the bloc's foreign subsidies regulation.' Like the U.S., the 27-nation EU bloc runs a massive trade deficit with China — around 300 billion euros ($350 billion) last year. It relies heavily on China for critical minerals and the magnets made from them for cars and appliances. When China curtailed the export of those products in response to Trump's tariffs, European automakers cried foul. China agreed during the summit to to start 'an upgraded export supply mechanism' to fast-track exports of critical minerals, von der Leyen said. Details of the arrangement were not immediately made public. Barkin said he doubted the mechanism would be 'a miracle solution for what may become a go-to coercion tool for Beijing in the years ahead.' The EU has imposed tariffs on Chinese electric vehicles to support its carmakers by balancing out Beijing's heavy auto subsidies. China would like those tariffs revoked. The rapid growth in China's market share in Europe has sparked concern that Chinese cars will eventually threaten the EU's ability to produce its own green technology to combat climate change. Business groups and unions also fear that the jobs of 2.5 million auto industry workers could be put in jeopardy, as well those of 10.3 million more people whose employment depends indirectly on EV production. China has launched investigations into European pork and dairy products, and placed tariffs on French cognac and armagnac. It has criticized new EU regulations of medical equipment sales and fears upcoming legislation that could further target Chinese industries, said Alicia García-Herrero, a China analyst at the Bruegel think tank. The EU has leverage because China needs to sell goods to the bloc, García-Herrero said. 'The EU remains China's largest export market, so China has every intention to keep it this way, especially given the pressure coming from the U.S.,' she said. China bristles at EU sanctions over Russia's war against Ukraine. The latest package included two Chinese banks that the EU accused of links to Russia's war industry. China's Commerce Ministry protested the listing and vowed to respond with 'necessary measures to resolutely safeguard the legitimate rights and interests of Chinese enterprises and financial institutions.' Buffeted between a combative Washington and a hardline Beijing, the EU has more publicly sought new alliances elsewhere, inking a trade pact with Indonesia and drafting trade deals with South America and Mexico. Costa and von der Leyen visited Tokyo the day before their meetings in Beijing, launching an alliance with Japan to boost economic cooperation, defend free trade and counter unfair trade practices. 'Both Europe and Japan see a world around us where protectionist instincts grow, weaknesses get weaponized, and every dependency exploited,' von der Leyen said. So it is normal that two like-minded partners come together to make each other stronger.' McNeil and Moritsugu write for the Associated Press. McNeil reported from Brussels. Mark Carlson in Brussels and Olivia Zhang in Beijing contributed to this report.
