All Posts in "George"

Investors say it’s time to take Trump seriously as markets recoil

SINGAPORE, March 4 (Reuters) – Markets no longer think Donald Trump is full of bluster and are moving quickly to anticipate a slowdown in U.S. and global growth as he raises a wall of tariffs around the world’s biggest economy and trading partners start to respond in kind. Six weeks into his second term, the U.S. president has hit imports from Mexico and Canada with 25% levies, put an additional 20% tariff on goods from China, threatened reciprocal tariffs globally and cut off military aid to Ukraine. But instead of the rising yields and higher dollar that investors had wagered on in November, the so-called “Trump trade” is in full retreat. Trade conflict has begun in earnest and the dollar is falling while bond yields dive. U.S. allies are rattled. As Goldman Sachs analysts note, the average tariff rate on imports from China is now 34% and the increase is already roughly twice as large as that in the first Trump administration. Nobody wants to bet anymore that there will be swift compromises or deals. “It is difficult for markets to get on with aggressive positioning given the risk of U.S. tariff policies turning on a dime,” said Chang Wei Liang, currency and credit strategist at DBS. “In credit markets, spreads certainly look too low given the change in risk environment and a more adverse and uncertain trade backdrop.” Volatility gauges for Treasuries (.MOVE), opens new tab and for U.S. (.VIX), opens new tab and Japanese stocks (.JNIV), opens new tab hit their highest levels of the year this week and implied volatility in currencies ticked higher. Stocks and bond yields slid on Tuesday as investors globally ducked for cover. Defence stocks ran higher, while shares in technology companies slumped. As China announced retaliatory tariffs and Mexico and Canada prepared their responses, investors reckoned on a global growth slowdown and upped expectations for U.S. rate cuts. Futures pricing still implies about 75 basis points of U.S. cuts this year, up from about 50 bps two weeks ago, while 10-year yields hit a 4-1/2 month low of 4.115%. Investors see an uncertain outlook where shelter lies in defensive sectors such as real estate or healthcare. And, while protected companies such as U.S. steelmakers may prosper, higher prices will flow along supply chains with unpredictable effect. “I’m spending a lot of time talking to CEOs who are really trying to understand the consequence of some of this,” said Goldman Sachs CEO David Solomon at conference in Australia. “Until there’s more certainty, we have a little bit more runway time. I think we’re going to live with a slightly higher level of volatility. But I think he (Trump) has a purposeful direction that he’s pursuing, and we should take him at his word that he’s going to pursue that direction.”

DIFFICULT TO TRADE

The fall in the dollar has been one of the most eye-catching reversals as conviction turns to confusion in currency trade. What had, in January, been speculators’ largest long-dollar bet in nearly a decade has rapidly unwound – so much so that, as of last week, speculators were short dollars against emerging market currencies and held a record long yen position . Against the euro , the dollar is down nearly 1% in two trading sessions as the fall in U.S. yields has coincided with rises for European yields since the continent prepares to ramp up defence spending while Trump backs away from Ukraine. At the White House, Trump took aim at China and Japan for holding their currencies too cheap. In fact, the yuan , against a basket of trading partners’ currencies, is historically firm and Japan has been intervening in recent years to buy the yen . But on Tuesday, as the dollar fell, Nomura’s global head of foreign exchange flow, Hoe Lon Leng, said it seemed like the “final blow” for those hoping for a higher dollar. “That argument is waning and we keep seeing the price action move the other way,” he said, noting that if both China and the U.S. did not want to see the dollar go higher against the yuan “then it is going to go lower”. To be sure, market gyrations have not been enormous and plenty of analysts do still see room for trade negotiations and an exit ramp from escalation. But the policy whiplash has gnawed away at hopes investors had in a breakthrough deal. And nobody can say they are sure Trump is bluffing. “The threat of tariffs has run its course for now, so the next phase is to endure them,” said Jamie Cox, managing partner at Harris Financial Group in Richmond, Virigina. “Markets have to price in that reality, and those numbers are painted red.”
George by — March 05, 2025 By George in Business News
Trump hails ‘reclaiming’ of Panama Canal after BlackRock-led group’s deal to buy stake

March 5 (Reuters) – U.S. President Donald Trump has hailed a deal led by U.S. firm BlackRock (BLK.N), opens new tab to buy most of the $22.8 billion ports business of Hong Kong conglomerate CK Hutchison (0001.HK), opens new tab which includes assets along the Panama Canal. The deal will give the U.S. consortium control of key Panama Canal ports amid White House calls to remove them from what it says is Chinese ownership. The high purchase price sent CK Hutchison’s stock up more than 20%. “My administration will be reclaiming the Panama Canal, and we’ve already started doing it,” Trump told the U.S. Congress. “Just today, a large American company announced they are buying both ports around the Panama Canal and lots of other things having to do with the Panama Canal and a couple of other canals.” The deal with the BlackRock-led consortium includes 90% of Panama Ports Company, which has operated the Balboa and Cristobal ports at each end of the canal for over two decades, said CK Hutchison. In total, the consortium, which includes Terminal Investment and Global Infrastructure Partners, will control 43 ports comprising 199 berths in 23 countries, the conglomerate said. CK Hutchison’s stock closed up 21.9% on Wednesday, outpacing a 2.8% rise in Hong Kong’s broader Hang Seng Index (.HSI), opens new tab. Its price is now the highest since August 1, 2023. The sale involves CK Hutchison’s 80% stake in Hutchison Ports with an equity value of $14.21 billion. However, the conglomerate will receive more than $19 billion following repayment of some shareholder loans. Goldman Sachs is advising CK Hutchison on the deal, two sources with knowledge of the deal said. Goldman Sachs declined to comment. The size of the proceeds would be similar to CK Hutchison’s entire Hong Kong market value prior to Wednesday’s share rally. The remainder of Hutchison Ports is owned by Singapore’s PSA International. About 12,000 ships used the Panama Canal last year that connects 1,920 ports across 170 countries. Its position is strategic for the U.S. as more than three-quarters of vessels passing through originate in or are bound for the United States. “I would like to stress that the transaction is purely commercial in nature and wholly unrelated to recent political news reports concerning the Panama Ports,” CK Hutchison co-managing director Frank Sixt in a statement. The conglomerate had been waiting for Panama Supreme Court to make a final ruling about the legal status of its government contract to operate the ports after the local attorney general determined the contract “unconstitutional”.

RAPID, COMPETITIVE PROCESS

CK Hutchison, controlled by billionaire tycoon Li Ka-shing, has interests ranging from infrastructure, retail to telecoms, aside from being the world’s largest privately owned port operator. Li has been diversifying his business outside of Hong Kong and mainland China since the 1980s and now only about 12% of CK Hutchison’s revenue is from Hong Kong and China, with the remainder from Europe, the rest of Asia Pacific and Canada. Sixt said the ports deal was the result of “a rapid, discrete but competitive process” during which CK Hutchison received numerous bids and expressions of interest. JPMorgan said in a report that while selling the Panama business is “understandable”, the deal is nevertheless a “surprise” given most of CK Hutchison’s other ports are not in regions directly exposed to Sino-U.S. geopolitical tension. It could be “an opportunistic deal”, JPMorgan said. “Based on our understanding of the management philosophy of CKH, any deal is possible as long as ‘the price is right’.” The brokerage said the deal would represent a significant strategy shift because it would leave ports contributing about 1% of the conglomerate’s earnings before interest, tax, depreciation and amortisation, down from 15%. The contribution of infrastructure, currently the largest segment, will rise to 33% from 28%. The $19 billion that CK Hutchison is set to receive from the sale is well above a $13 billion valuation on the ports assets estimated by analysts. “The disposal would be significantly value enhancing,” Citigroup analysts said. CK Hutchison’s net debt level was HK$138 billion ($17.76 billion) in June and the sales proceeds could put the conglomerate into a net cash position, UBS analysts said. ($1 = 7.7722 Hong Kong dollars)
George by — March 05, 2025 By George in Business News
US manufacturing hit by ‘operational shock’ of Trump tariffs pushing costs up

Data out Monday showed activity in the manufacturing sector slowed in February while costs increased and employment contracted, as President Donald Trump’s tariff policies weighed on the sector.

The Institute for Supply Management’s manufacturing PMI registered a reading of 50.3 in February, down from January’s 50.9 reading and below the 50.7 economists had expected. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate a contraction.

Meanwhile, the prices paid index surged to a reading of 62.4, up from 54.9 the month prior and its highest level since July 2022, reflecting company costs continuing to increase. The employment index fell into contraction with a reading of 47.6 in February, down from 50.3 in January.

All three major stock indexes hit their lows of the day following the release, with the Nasdaq Composite (^IXIC) sliding the furthest, down about 1% before paring back losses.

“Demand eased, production stabilized, and destaffing continued as panelists’ companies experience the first operational shock of the new administration’s tariff policy,” Institute for Supply Management Chair Timothy Fiore wrote in the release. “Prices growth accelerated due to tariffs, causing new order placement backlogs, supplier delivery stoppages and manufacturing inventory impacts.”

Fiore explained in an interview with Yahoo Finance that the surge in the prices paid index was largely due to Trump’s 25% tariffs on steel and aluminum imports.

“The whole story here is really around the tariff issue,” Fiore said, further explaining that the increases in prices lead to lower new orders from businesses and also could impact hiring plans. If Trump’s proposed 25% tariffs on Mexico and Canada are enacted, Fiore said he expects the situation to worsen, with prices continuing to increase and manufacturing activity further weakening.

“If you stay on the path that we’re headed on, I think it’s going to be tough, a tough route [for the US economy],” Fiore said.

ISM’s prices paid index has closely tracked the monthly prints of the Consumer Price Index (CPI) and the Producer Price Index (PPI), per Fiore. This month’s large increase in the prices paid index likely points to an increase in prices for the two inflation measures — CPI and PPI — in February, Fiore said.

Capital Economics North America economist Thomas Ryan wrote in a note to clients on Monday that the ISM data “supports our view that there will be a goods-driven resurgence in core inflation in the second half of the year.”

“The drop back in the ISM manufacturing index and the negative tone of the report will add to fears that the economy has taken a sudden turn for the worse amid the barrage of weaker activity data in recent weeks,” Ryan wrote.

George by — March 04, 2025 By George in World News
China, Mexico and Canada hit back against Trump tariffs

Canada, Mexico and China have vowed to retaliate after tariffs on goods entering the US from their countries came into effect on Tuesday.

US President Donald Trump has imposed 25% tariffs against Canada and Mexico, and 20% tariffs against China.

Stock markets in the US, UK and Asia dipped following the introduction of the taxes amid fears of trade war widening.

Analysts have warned tariffs could push up prices for US households and could also have a knock on effect on consumers across the world, including the UK.

Trump threatened to impose the tariffs, which are a tax added to a product when it enters a country – on Canada, Mexico and China in response to what claims is the unacceptable flow of illegal drugs and illegal immigrants into the US.

But Canadian Prime Minister Justin Trudeau said his country was responsible for less than 1% of fentanyl entering the US and would retaliate with 25% tariffs on $150bn worth of US goods.

China swiftly announced its own counter measures, which include 10-15% tariffs on some US agricultural goods, including wheat, corn, beef and soybeans. Mexico is expected to announce its response later.

The three major stock market indexes in the US sank following the news, while the FTSE 100 index of the UK’s biggest publicly-listed companies opened sharply lower on Tuesday and stock markets in Asia were also down.

Andrew Wilson, from the International Chamber of Commerce, said: “What we’re seeing is the biggest effective increase in US tariffs since the 1940s – with severe economic risks attached to that.”

“The initial market moves are entirely reflective that we’re now entering into a very risky scenario for global trade and for the global economy,” he told BBC Radio 4’s Today programme

He said Yale University had predicted these measures could cost US households in the region of $2,000 in this year alone.

Ella Hoxha, head of fixed income at Newton Investment Management, told the BBC: “In terms of consumers, you’re more likely looking at, certainly over the short term, increases in prices as companies pass some of those prices onto the consumer.”

Chris Torrens, vice president of the British Chamber of Commerce in China, added: “It’s a huge challenge for British business because of the historical links that the UK and the US have. [We are] Seeing what looks like the dismantling of a transatlantic alliance between the US and Europe.

“But, there is a real sense of hope for a stronger UK-China relationship.”

George by — March 04, 2025 By George in World News
Here’s Why We Think On Holding (NYSE:ONON) Might Deserve Your Attention Today

For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to investors, even if it currently lacks a track record of revenue and profit. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. While a well funded company may sustain losses for years, it will need to generate a profit eventually, or else investors will move on and the company will wither away.

Despite being in the age of tech-stock blue-sky investing, many investors still adopt a more traditional strategy; buying shares in profitable companies like On Holding (NYSE:ONON). Now this is not to say that the company presents the best investment opportunity around, but profitability is a key component to success in business.

How Fast Is On Holding Growing Its Earnings Per Share?

Over the last three years, On Holding has grown earnings per share (EPS) at as impressive rate from a relatively low point, resulting in a three year percentage growth rate that isn’t particularly indicative of expected future performance. As a result, we’ll zoom in on growth over the last year, instead. On Holding’s EPS skyrocketed from CHF0.25 to CHF0.39, in just one year; a result that’s bound to bring a smile to shareholders. That’s a commendable gain of 57%.

Top-line growth is a great indicator that growth is sustainable, and combined with a high earnings before interest and taxation (EBIT) margin, it’s a great way for a company to maintain a competitive advantage in the market. While we note On Holding achieved similar EBIT margins to last year, revenue grew by a solid 26% to CHF2.2b. That’s a real positive.

In the chart below, you can see how the company has grown earnings and revenue, over time. For finer detail, click on the image.

earnings-and-revenue-history
NYSE:ONON Earnings and Revenue History March 1st 2025

You don’t drive with your eyes on the rear-view mirror, so you might be more interested in this free report showing analyst forecasts for On Holding’s future profits.

Are On Holding Insiders Aligned With All Shareholders?

Since On Holding has a market capitalisation of US$15b, we wouldn’t expect insiders to hold a large percentage of shares. But thanks to their investment in the company, it’s pleasing to see that there are still incentives to align their actions with the shareholders. We note that their impressive stake in the company is worth CHF2.9b. That equates to 19% of the company, making insiders powerful and aligned with other shareholders. So there is opportunity here to invest in a company whose management have tangible incentives to deliver.

Is On Holding Worth Keeping An Eye On?

If you believe that share price follows earnings per share you should definitely be delving further into On Holding’s strong EPS growth. This EPS growth rate is something the company should be proud of, and so it’s no surprise that insiders are holding on to a considerable chunk of shares. Fast growth and confident insiders should be enough to warrant further research, so it would seem that it’s a good stock to follow. Of course, profit growth is one thing but it’s even better if On Holding is receiving high returns on equity, since that should imply it can keep growing without much need for capital. Click on this link to see how it is faring against the average in its industry.

Although On Holding certainly looks good, it may appeal to more investors if insiders were buying up shares. If you like to see companies with more skin in the game, then check out this handpicked selection of companies that not only boast of strong growth but have strong insider backing.

George by — March 04, 2025 By George in Equities
IonQ, Inc. (NYSE:IONQ) Just Reported, And Analysts Assigned A US$44.60 Price Target

One of the biggest stories of last week was how IonQ, Inc. (NYSE:IONQ) shares plunged 23% in the week since its latest yearly results, closing yesterday at US$24.57. Revenues of US$43m beat expectations by a respectable 4.0%, although statutory losses per share increased. IonQ lost US$1.56, which was 80% more than what the analysts had included in their models. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there’s been a strong change in the company’s prospects, or if it’s business as usual. We’ve gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Following the latest results, IonQ’s five analysts are now forecasting revenues of US$85.4m in 2025. This would be a substantial 98% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 25% to US$1.15. Before this latest report, the consensus had been expecting revenues of US$83.2m and US$0.95 per share in losses. While this year’s revenue estimates increased, there was also a very substantial increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

Spiting the revenue upgrading, the average price target fell 5.5% to US$44.60, clearly signalling that higher forecast losses are a valuation concern. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company’s valuation. There are some variant perceptions on IonQ, with the most bullish analyst valuing it at US$54.00 and the most bearish at US$29.00 per share. This shows there is still a bit of diversity in estimates, but analysts don’t appear to be totally split on the stock as though it might be a success or failure situation.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It’s clear from the latest estimates that IonQ’s rate of growth is expected to accelerate meaningfully, with the forecast 98% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 67% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 6.7% per year. Factoring in the forecast acceleration in revenue, it’s pretty clear that IonQ is expected to grow much faster than its industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at IonQ. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

 

George by — March 04, 2025 By George in Equities
European stocks close at record high, led by defence shares

March 3 (Reuters) – Defence stocks powered European shares to a record high on Monday, after expectations mounted of higher military spending in the region, and the prospect of a Ukraine peace proposal boosted sentiment. Germany’s blue-chip index (.GDAXI), opens new tab logged its biggest one-day jump since November 2022, and closed at a record high, alongside Britain’s benchmark index (.FTSE), opens new tab. The pan-European STOXX 600 index (.STOXX), opens new tab closed up 1.1%, at a record high, building on 10 straight weeks of gains. Leaders from major European economies agreed, over the weekend, to boost defence spending to show U.S. President Donald Trump that the continent could protect itself. Britain said there were several possible proposals for a Ukraine ceasefire after last week’s Oval Office rupture between U.S. President Donald Trump and Ukrainian President Volodymyr Zelenskiy. Rheinmetall (RHMG.DE), opens new tab surged 13.7% to a record high, while Italy’s Leonardo (LDOF.MI), opens new tab advanced 16%. Britain’s BAE Systems (BAES.L), opens new tab was up 14.5%. France’s Thales (TCFP.PA), opens new tab and Dassault Aviation (AM.PA), opens new tab were up 16% and 14%, respectively. The European aerospace and defence index (.SXPARO), opens new tab climbed 7.7% to a record high, while the industrial goods and services sector (.SXNP), opens new tab gained 2.5%. A Reuters report that said parties in talks to form Germany’s new government were considering setting up a defence fund also boosted sentiment towards the defence companies. “While hopes of a Ukraine peace plan continue to play some part in today’s positive market action, it is the expectation of rearmament across Europe that is the most important driver,” said Chris Beauchamp, chief market analyst at trading platform IG. “However, the problem is, as with all these euphoric surges, that it may take some time for it to fully develop… With European defence, it’s a question of seeing how this translates into actual funding.” Germany’s 10-year Bund yield , the euro zone benchmark, rose to 2.49%, pressuring rate-sensitive real estate (.SX86P), opens new tab and utilities (.SX6P), opens new tab, which were the top sectors in the red. Meanwhile, data showed Euro zone inflation dipped less than expected last month, but its most closely watched element dropped, sealing the case for another ECB interest rate cut on Thursday and for further policy easing in the coming months. The focus, however, will be on the central bank’s stance on U.S. plans for “reciprocal” tariffs on the European Union, as Trump’s deadline for tariffs on Canada and Mexico, and a further 10% duty on China looms Bunzl (BNZL.L), opens new tab fell 8.8% after the business supplies distributor reported a fall in annual profit.
George by — March 04, 2025 By George in Market Watch
NEW YORK, March 3 (Reuters) – Kraken, one of the world’s largest cryptocurrency exchanges, said on Monday the U.S. Securities and Exchange Commission agreed in principle to dismiss a civil lawsuit accusing it of operating illegally as an unregistered securities exchange. In a statement on its blog, Kraken called the dismissal a turning point for cryptocurrency that ended a “wasteful, politically motivated campaign” begun during the Biden administration, and which stifled innovation and investment. Kraken said the dismissal includes no admission of wrongdoing, no penalties, and no changes to its business. It also said the dismissal is with prejudice, meaning the SEC cannot bring the case again. “This case was never about protecting investors,” Kraken said. “It undermined a nascent industry that repeatedly urged clear rules of the road. “We appreciate the new leadership both at the White House and the Commission that led to this change,” Kraken added. The SEC declined to comment. Kraken had been sued in November 2023, as part of former SEC Chair Gary Gensler’s push to bring cryptocurrency under the regulator’s purview. But the SEC has pulled back on crypto oversight since U.S. President Donald Trump began his second White House term in January. Last week, the SEC ended a similar lawsuit against Coinbase (COIN.O), opens new tab, the largest U.S. cryptocurrency exchange, and said it may resolve its civil fraud case against Justin Sun, the Chinese entrepreneur and adviser to a Trump-backed crypto project. Trump, meanwhile, nominated Paul Atkins, a Washington lawyer seen as supportive of digital assets, to succeed Gensler as SEC chair. The SEC had accused Payward and Payward Ventures, which operate as Kraken, of having since 2018 made hundreds of millions of dollars arranging purchases and sales of 11 crypto assets while turning a “blind eye” to securities laws. Kraken was also accused of having deficient internal controls and record keeping. Like the vast majority of the cryptocurrency industry, Kraken argued that crypto assets, unlike stocks and bonds, did not qualify as investment contracts subject to SEC oversight. A federal judge in San Francisco denied Kraken’s bid to dismiss the case last August. Kraken is the world’s 10th-ranked cryptocurrency spot exchange based on traffic, liquidity, trading volumes, and confidence in the legitimacy of reported trading volumes, according to CoinMarketCap.

NEW YORK, March 3 (Reuters) – Kraken, one of the world’s largest cryptocurrency exchanges, said on Monday the U.S. Securities and Exchange Commission agreed in principle to dismiss a civil lawsuit accusing it of operating illegally as an unregistered securities exchange. In a statement on its blog, Kraken called the dismissal a turning point for cryptocurrency that ended a “wasteful, politically motivated campaign” begun during the Biden administration, and which stifled innovation and investment. Kraken said the dismissal includes no admission of wrongdoing, no penalties, and no changes to its business. It also said the dismissal is with prejudice, meaning the SEC cannot bring the case again. “This case was never about protecting investors,” Kraken said. “It undermined a nascent industry that repeatedly urged clear rules of the road. “We appreciate the new leadership both at the White House and the Commission that led to this change,” Kraken added. The SEC declined to comment. Kraken had been sued in November 2023, as part of former SEC Chair Gary Gensler’s push to bring cryptocurrency under the regulator’s purview. But the SEC has pulled back on crypto oversight since U.S. President Donald Trump began his second White House term in January. Last week, the SEC ended a similar lawsuit against Coinbase (COIN.O), opens new tab, the largest U.S. cryptocurrency exchange, and said it may resolve its civil fraud case against Justin Sun, the Chinese entrepreneur and adviser to a Trump-backed crypto project. Trump, meanwhile, nominated Paul Atkins, a Washington lawyer seen as supportive of digital assets, to succeed Gensler as SEC chair. The SEC had accused Payward and Payward Ventures, which operate as Kraken, of having since 2018 made hundreds of millions of dollars arranging purchases and sales of 11 crypto assets while turning a “blind eye” to securities laws. Kraken was also accused of having deficient internal controls and record keeping. Like the vast majority of the cryptocurrency industry, Kraken argued that crypto assets, unlike stocks and bonds, did not qualify as investment contracts subject to SEC oversight. A federal judge in San Francisco denied Kraken’s bid to dismiss the case last August. Kraken is the world’s 10th-ranked cryptocurrency spot exchange based on traffic, liquidity, trading volumes, and confidence in the legitimacy of reported trading volumes, according to CoinMarketCap.
George by — March 04, 2025 By George in Market Watch
Markets sink as Trump confirms tariffs on Canada, Mexico and China

President Donald Trump has said he is moving forward with 25% tariffs on goods imported from Canada and Mexico into the US, adding that time had run out to reach a deal. US stock markets sank in response to the measures, which he has threatened since earlier this year and said would now go into effect on Tuesday. An additional 10% tariff on Chinese imports is also expected to come into force, leaving all of America’s top three trade partners facing significantly higher barriers than just a few weeks ago. “No room left for Mexico or for Canada,” Trump said at the White House on Monday. “The tariffs, you know, they’re all set. They go into effect tomorrow.” The three major indices in the US sank after Trump’s comments. The Dow Jones Industrial Average ended the day down 1.4%, the S&P 500 sank 1.75% and the Nasdaq fell 2.6%. Prime Minister Justin Trudeau responded: “Canada will not let this unjustified decision go unanswered.” Canadian Foreign Minister Melanie Joly told reporters that Ottawa planned to impose retaliatory tariffs against US imports of C$155bn ($107bn; £ 84bn), with the first tranche of $30bn ready immediately to be levied on everyday goods like pasta, clothing and perfume. The foreign minister added that the tariffs were “an existential threat to us”, with “thousands of jobs in Canada at stake”.
Graphic
China’s commerce ministry on Tuesday also vowed to retaliate against the fresh US tariffs, accusing the Trump administration of trying to “shift the blame” and “bully” Beijing over fentanyl flows. In a statement, the ministry urged the US to “immediately withdraw” its tariffs that it described as “unreasonable and groundless, harmful to others”. State media outlet The Global Times reported on Monday that China may target US agricultural and food products with both tariff and non-tariff measures. Mexico also said it will retaliate against the US tariffs, raising the prospect of a widening trade war. Trump threatened to impose the tariffs, which are a tax added to a product when it enters a country – on Canada, Mexico and China in response to what he said was the unacceptable flow of illegal drugs and illegal immigrants into the US. All the tariffs were supposed to take effect last month, until the US agreed to a one-month delay for Canada and Mexico, pulling its North American neighbours back from the brink of a potentially damaging trade war. But Trump went ahead with imposing a 10% tariff on Chinese exports to the US in February, meaning goods from the country now face a levy of at least 20%. Trump has long maintained that tariffs are a useful tool to correct trade imbalances and protect US manufacturing. He has largely dismissed concerns that the measures risk economic damage in the US, despite the close ties, especially in North America, where businesses have enjoyed decades of free trade. “What they’ll have to do is build their car plants, frankly, and other things, in the United States, in which case they have no tariffs,” he added. Officials from Canada and Mexico had been in Washington in recent days, trying to stave off the tariffs. Mexican President Claudia Sheinbaum appeared to send a message to Trump earlier on Monday when she said at a public event in the city of Colima that “Mexico has to be respected”. “Co-operation [and] co-ordination, yes, subordination, never.” Trudeau met King Charles on Monday in the UK, saying beforehand that he would discuss issues of importance to Canadians, including “standing up for our sovereignty and our independence as a nation”. A day earlier Canada’s PM said from a summit in London that Canada was “not an issue” as a source of illegal fentanyl in the US. Only 1% of fentanyl seized in the US is thought to come from Canada, according to US data. The Canada Border Services Agency (CBSA) says it has been “surging” its efforts to tackle fentanyl crossing into the US. President Trump has also announced a 25% charge on all steel and aluminium imports, which is meant to come into effect on 12 March. In addition, he has threatened to impose custom “reciprocal” tariffs on individual countries, as well as 25% tariffs on the European Union.
George by — March 04, 2025 By George in Business News
South Korean defense stocks track gains in global peers amid rising security concerns

South Korean defense stocks rose Tuesday, in line with a broad-based pickup in defense names globally, as the Russia-Ukraine war fuels security concerns. Gains among South Korean names were led by Hanwha Aerospace, Korea Aerospace Industries, Hyundai Rotem and LIG Nex1. Shares in Hanwha Aerospace surged as much as 16.67%, while Hyundai Rotem shares rose as much as 11.51%. Hyundai Rotem specializes in producing railway equipment and defense products. Meanwhile, shares in Korea Aerospace and LIG Nex 1, which manufactures arms and aerospace equipment, gained as much as 7.77% and 7.76% respectively. Other South Korean defense stocks were also trading higher, with Victek shares up 4.88%, Firstec up 4.69% and Poongsan up 7.65%. South Korean military manufacturing companies saw demand pickup in 2024 powered by massive arms orders. “South Korea’s position as a defense industrial powerhouse is backed up by real numbers,” a report released by the Italian Institute for International Political Studies last April stated. It also highlighted that the country’s arms exports increased from $2 billion to $3 billion in the late 2010s, hitting $7.3 billion in 2021. The pickup in South Korean defense stocks comes amid expectations of higher defense spending by Europe, after regional leaders held security talks that touched on bolstered military spending. The meeting touched on the need to strengthen Ukraine and European defense, after Trump and Ukraine President Volodymyr Zelenskyy clashed at the White House on Feb. 28 over differing views on how to end the Russia-Ukraine conflict. British Prime Minister Keir Starmer also pledged to boost military spending to 2.5% of gross domestic product by 2027. Other European nations may follow suit. Morningstar’s aerospace and defense analyst Loredana Muharremi expects European defense spending to reach 3.1% of gross domestic product by 2029, and 3.5% by 2032. “We believe a 3.1% defense spending target by 2029 is feasible if this is strategically structured, with debt financing potentially supporting the growth, and focuses on European production and research and development,” she wrote in a report on Monday. The Stoxx Europe aerospace and defense index surged 8% on Monday. This marked the index’s best session in 5 years. Meanwhile, defense stocks in the U.S. also climbed Monday, after Trump made it clear that tariffs on Mexico and Canada would go into effect as planned. — CNBC’s Lim Hui Jie contributed to this report.
George by — March 04, 2025 By George in Business News
error: Content is protected !!