U.S.-China trade truce: chip design software and jet engine makers among the early beneficiaries
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CNBC
12 minutes ago
- CNBC
Re-risking your portfolio: Investor John Davi's picks for the second half of 2025
John Davi, founder and CEO of investment management company Astoria Portfolio Advisors, has one overriding piece of advice for investors heading into the second half of the year: "Re-risk your portfolio." The stock market has made a sharp turnaround from its early April lows, when fears over tariffs and their effect on inflation and the econony were at their highest. The S & P 500 was down 15% year-to-date on April 8, but is now up roughly 6.7% for the year as investors have regained confidence in the outlook for the economy , strong corporate profits and AI technology. But investors lately continue to seek out resilient pockets of the market due to uncertain trade policies and geopolitical tensions, however. Like many investors, Davi — whose firm manages $2.5 billion in total assets, including four ETFs — has gotten more constructive on U.S. stocks compared to the beginning of 2025. The recent run-up, particularly in the broader market outside tech, has given him greater conviction in companies beyond classic growth stocks. "Now we're at a point where earnings revision breadth has had this V-shape recovery. We have a weaker dollar. We've got policy uncertainty that's declined ... less tariffs. We have renewed optimism over AI," Davi told CNBC. In the past, a declining dollar "has been a tailwind for risk assets, globally ... rather than keep buying the 'Mag 7' stocks, there's so many other opportunities out there." "It's time to re-risk your portfolio," Davi said, at a time when markets are likely to rally further over the coming six months. ETFs to navigate the rest of 2025 Buying exchange-traded funds tied to the broader market are a generally safe bet for long-term investors seeking passive gains. But Davi's advice is to look beyond popular ETFs such as SPDR S & P 500 ETF and Vanguard S & P 500 ETF and look instead at opportunities in industrials, energy, real estate and fixed income. Davi named several ETFs that are strong picks heading into the latter half of the year, noting they're tax-efficient with low fees and a "safer and more conducive" means of accumulating wealth for individual investors. Equal-weighted ETFs are among his favorite during periods of high concentration, as they can offer strong returns and more diversification, particularly when smaller companies outperform. As an example, Davi spotlighted the Invesco S & P 500 Eql Wght Industrials ETF (RSPN) as a better way to gain exposure to industrials than the popular Industrial Select Sector SPDR Fund (XLI) . "There's all this risk still out there, right. But really, if you strip out the 'Mag 7,' the S & P 500 is not that expensive," he said. An equal-weighted ETF that's not skewed to the largest stocks today takes advantage of stocks outside technology, or mid-sized and smaller companies, "that are growing faster earnings than these tech stocks." One of Davi's top picks is the BNY Mellon Global Infrastructure Income ETF (BKGI) , which has jumped 30% in 2025 and 41% over the past year, against S & P 500 returns of nearly 7% and 15% over the same periods, according to FactSet. The fund's last 12 months' distribution yield is 4.17%, its net expense ratio is 0.55% and the average price-to-earnings ratio of its portfolio is 16.2 times trailing earnings, FactSet data shows. The ETF's top holdings are concentrated in utilities and energy, with Enel SpA , Hess Midstream , Orange SA and Dominion Energy among its top 10 holdings as of March 31. PPI SPY 1Y mountain Astoria Real Assets ETF (PPI) vs. SPDR S & P 500 ETF (SPY) over the past year. Astoria Real Assets ETF (PPI) offers similar opportunities, Davi said. The fund has also outperformed, rallying 14% so far in 2025. With a net expense ratio of 0.78% and a trailing, 12-month yield of 1.36%, the fund' top holdings include SPDR Gold MiniShares Trust , Rolls-Royce Holdings , Simon Property Group , Shell and Constellation Energy . Industrial and utility stocks have raced ahead this year, gaining more than 13% and 8%, respectively, as investments have ooured into AI-related projects such as data center infrastructure and equipment. In fixed income, Davi pointed to the Schwab High Yield Bond ETF (SCYB) , JPMorgan BetaBuilders USD High Yield Corp Bd ETF (BBHY) , Janus Henderson AAA CLO ETF (JAAA) and the SPDR Portfolio Intermediate Term Corporate Bd ETF (SPIB) as attractive. "Owning credit makes a lot of sense. There's value in holding high yield credit and corporate credit," he said.
CNBC
28 minutes ago
- CNBC
London IPO fundraising hits a three-decade low in another blow to the UK capital
Fundraising from London IPOs slumped to at least a three-decade low in the first half of this year, new data showed on Friday – raising fresh questions about the fading allure of the U.K. as a hub for global capital. The five debuts on the London market in the first six months of 2025 raised a total of £160 million ($218.6 million), according to new data from Dealogic. That's the lowest level of London IPO funds raised in the first half of the year recorded by Dealogic since it began collecting data in 1995. Even in the aftermath of the 2008 financial crisis, two London IPOs managed to raise £222 million in the first half of 2009, the data shows. London's biggest IPO so far this year was the listing of professional services company MHA, which raised £98 million at its debut on the Alternative Investment Market (AIM) in April. The listings slump in London this year adds to the city's struggles to hold onto its former glory as one of the top destinations for global capital. According to the most recent IPO Watch report from professional services giant PwC, IPO proceeds in the U.K. fell to £100 million in the first quarter of 2025, down from £300 million in the same period a year earlier. This year alone, the city's financial markets have been passed over by firms that had once planned blockbuster listings there. Shein, for example, is reported to be planning an IPO in Hong Kong after abandoning earlier plans to float its shares in London, while Glencore-backed metals investor Cobalt Holdings confirmed to CNBC last month that it had scrapped plans for a London IPO. The troubles aren't limited to new listings – in June, British fintech giant Wise announced it was moving its primary listing from London to New York, and earlier this week it was reported that pharma giant AstraZeneca – the most valuable company on London's FTSE 100 index – is considering moving its listing to the United States. Kristo Kaarmann, Wise's CEO and co-founder, said in a statement at the time that the move would help raise awareness of the company in the U.S., while giving the firm better access to "the world's deepest and most liquid capital market." Dealogic's data highlighted a significant gap between U.S. and U.K. listings so far this year. U.S. markets saw 156 IPOs in the first six months of the year, which collectively raised $28.3 billion, the figures showed. However, Samuel Kerr, head of equity capital markets at Mergermarket, told CNBC that while U.K. equity markets have "been under a cloud of negative press for some time," there could be brighter times ahead for London. "We are seeing more businesses beginning to look seriously at London listings again after several years of reform and broader uncertainty over the regulatory and policy direction of the US," he said in an email. U.K. Prime Minister Keir Starmer has touted his government's plans to revitalize Britain's capital markets, pledging to look into regulation that is "needlessly holding back investment." Last summer, the U.K.'s Financial Conduct Authority overhauled listing rules in a bid to simplify the process of floating shares on the U.K. market. "If London can convert early-stage interest in UK listings into successful IPOs, it will go some way to reversing some of the doom narrative," Mergermarket's Kerr told CNBC. Janet Mui, head of market analysis at wealth manager RBC Brewin Dolphin, pointed out that exits via IPOs were slowing globally. "It's easy to be bearish when we have news like this," she said in an email on Friday. "The reality is more nuanced, including macro uncertainty and tighter financial conditions have slowed listing globally." Last week, the Financial Times reported that Norwegian software giant Visma had chosen London for its upcoming debut on the public market. Mui argued that this news showed there was still appetite for high growth companies to list in London. "That said, more work is needed to deliver reforms to streamline listing and make London more attractive to businesses," she conceded.
CNBC
an hour ago
- CNBC
Trump's tariffs deadline is looming for Europe. Here's where things stand
All eyes are on talks between the U.S. and the European Union, which have yet to strike a trade deal with just days to go before Washington's tariffs come into full effect. Should the trading partners fail to reach an agreement by July 9 — when a 90-day reprieve on U.S. President Donald Trump's so-called reciprocal tariffs ends — EU goods imported to the U.S. could be hit by duties of up to 50%. Retaliatory measures from the EU targeting a wide range of U.S. goods, which have also been temporarily put on hold, could then follow shortly afterward. The U.S.-EU trade relationship is one of the most important in the world, accounting for around 30% of global goods trading according to the European Council. Medicinal and pharma products, road vehicles and petroleum products are some of the top traded goods. In 2024, trade between the two transatlantic partners was valued at around 1.68 trillion euros ($1.98 trillion) when taking into account both goods and services, the European Council said. The EU recorded a surplus of 198 billion euros, when it comes to goods, but logged a deficit of around 148 billion euro in the trading of services — meaning the bloc overall had a trade surplus of around 50 billion euros in 2024. Trump has repeatedly taken issue with the trade relationship between Washington and Brussels, suggesting it is unfair and accusing the EU of taking advantage of the U.S. U.S.-EU negotiations have appeared to be difficult and slow to gain ground. Sources told CNBC earlier this week that a bare-bones political deal that is light on details may be the EU's best hope. European Commission President Ursula von der Leyen seemed to echo the view on Thursday. "What we are aiming at is an agreement in principle," she said, adding that a detailed agreement was "impossible" to reach during the 90-day reprieve. Von der Leyen also reiterated that, if no agreement is reached, "all the instruments are on the table." European Trade Commissioner Maros Sefcovic meanwhile said in a social media post on Friday said that he had had a "productive" week in Washington D.C. meeting various U.S. officials. "The work continues. Our goal remains unchanged: a good and ambitious transatlantic trade deal," he said. U.S. Treasury Secretary Scott Bessent seemed more hesitant about the odds of a trade agreement being struck before the deadline. "We'll see what we can do with the European Union," he told CNBC's "Squawk on the Street" on Thursday. Experts speaking to CNBC appeared skeptical about the short-term likelihood of a fully-fledged deal. Anthony Gardner, former U.S. Ambassador to the EU, told CNBC's "Squawk Box Europe" on Friday that he was "not surprised" von der Leyen had excluded the possibility of an all-inclusive deal. "The detailed agreement is what it says: detailed. It can run into many pages, [because] full trade agreements are thousands of pages, but what we could see is heads of terms like the one that the U.S. signed with the U.K.," he said. "So that's possible, but I don't think the actual content will be similar," Gardner added.
