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Wed, 04 Jun 2025 14:35:50 +0000 WTI Extends Gains As Crude Stocks See Biggest Draw Since December
WTI Extends Gains As Crude Stocks See Biggest Draw Since December
Crude prices are higher this morning on signs of progress in trade talks between the US and EU and the API report of a major drawdown in American cru
Read more.....
WTI Extends Gains As Crude Stocks See Biggest Draw Since December
Crude prices are higher this morning on signs of progress in trade talks between the US and EU and the API report of a major drawdown in American crude inventories (despite product builds).
Geopolitical tensions continue to drive prices more aggressively as the possibility of a Putin-Zelensky meeting came and went and Iranian peace deal talks stumble.
The big question for traders is - will the official data confirm API's drawdown?
API
Crude -3.28mm
Cushing +952k
Gasoline +4.73mm
Distillates +761k
DOE
Crude -4.30mm
Cushing +576k
Gasoline +5.22mm
Distillates +4.23mm
The official data confirmed API's report with a large crude draw offset by big draws in products...
Source: Bloomberg
Even including the 509k barrel addition to the SPR, total crude stocks fell by the most since December...
Source: Bloomberg
The rig count continues to slide (now at its lowest since Dec 2021), and despite Trump's 'Drill, Baby, Drill' push, US crude production remains well of its highs...
Source: Bloomberg
WTI extended gains after the official data confirmed API's...
Source: Bloomberg
Oil rose at the start of the week after a decision by OPEC+ to increase production in July was in line with expectations, easing concerns over a bigger hike.
However, prices are still down about 11% this year on fears around a looming supply glut, while traders continue to monitor US trade tariffs as President Donald Trump said his Chinese counterpart is “extremely hard” to make a deal with.
Saudi Arabia led increases in OPEC oil production last month as the group began its series of accelerated supply additions, according to a Bloomberg survey.
Nevertheless, the hike fell short of the full amount the kingdom could have added under the agreements .
Tyler Durden
Wed, 06/04/2025 - 10:35 Close
Wed, 04 Jun 2025 14:20:00 +0000 US Embassy Officials Warn Americans Not To Use Dating Apps To Meet People In Mexico
US Embassy Officials Warn Americans Not To Use Dating Apps To Meet People In Mexico
US Embassy Officials Warn Americans Not To Use Dating Apps To Meet People In Mexico
Authored by Jack Phillips via The Epoch Times,
U.S. embassy officials in Mexico this week confirmed reports of American citizens having been kidnapped in Mexico by people they met on dating apps.
Confirming those reports, the U.S. Consulate General Guadalajara said that U.S. citizens were kidnapped in the Puerto Vallarta and Nuevo Nayarit areas in recent months after meeting the individuals on a dating app.
“Victims and their families in the United States have at times been extorted for large sums of money to secure their release,” the Guadalajara consulate said .
“Please be aware that this type of violence is not limited to one geographic area. Travelers should use caution when meeting strangers.”
The officials did not name any specific dating apps but provided advice to people traveling to Mexico, saying that they should only “meet in public places and avoid isolated locations, such as residences or hotel rooms, where crimes are most likely to occur.”
“Tell a friend or family member of your plans, including where you are going, details of the person you are meeting, and the app you used to meet them,” the consulate said.
“Trust your instincts. If something does not feel right, do not hesitate to remove yourself from a situation. In case of emergency, call 911.”
The statement also noted that Americans should be aware of its travel advisory to Jalisco, where Puerto Vallarta is located. The state is classified as “Level 3: Reconsider Travel” due to crime and kidnappings. Nayarit state, where Nuevo Nayarit is located, is classified as “Level 2: Exercise Increased Caution” due to crime, according to the State Department.
The U.S. Embassy breaks down Mexico state-by-state, listing the states U.S. citizens should avoid or exercise caution.
Only two states—Campeche and Yucatan—are listed under the embassy’s “Level 1” designation, which is its lowest. Every other state is rated “Level 2” or greater, with Colima, Guerrero, Michoacan, Sinaloa, Tamaulipas, and Zacatecas states listed as “Level 4: Do Not Travel” due to crime and kidnappings.
According to the State Department, U.S. government workers cannot travel between Mexican cities after dark, cannot hail taxis, and must rely on dispatched vehicles.
“The U.S. government has limited ability to provide emergency services to U.S. citizens in many areas of Mexico, as travel by U.S. government employees to certain areas is prohibited or restricted. In many states, local emergency services are limited outside the state capital or major cities,” the State Department cautions on its website.
Earlier this year, U.S. officials issued “Do Not Travel” warnings to several areas near the U.S.-Mexico border due to gun battles and improvised explosive devices (IEDs) being left near roadsides.
The warning, issued in January, noted that officials are “aware of increasingly frequent gun battles occurring in and around Reynosa in the late night and early morning hours.” IEDs were found in the Reynosa, Rio Bravo, Valle Hermoso, and San Fernando areas, which border the Rio Grande Valley area in Texas.
In a report updated in February, the Council on Foreign Relations think tank said that, since 2018, more than 30,000 people have died each year due to a “crisis of kidnappings, disappearances, and other criminal violence.” It noted that drug cartels and gangs are the primary perpetrators of the country’s violence.
Tyler Durden
Wed, 06/04/2025 - 10:20 Close
Wed, 04 Jun 2025 14:08:06 +0000 Baffle 'Em With Bullshit: Services Surveys Signal Soaring & Plunging Economy
Baffle 'Em With Bullshit: Services Surveys Signal Soaring & Plunging Economy
After the mixed picture from Manufacturing surveys (ISM ugly, PMI solid); both Services surveys - due this morning - were expected to rise in May.
Baffle 'Em With Bullshit: Services Surveys Signal Soaring & Plunging Economy
After the mixed picture from Manufacturing surveys (ISM ugly, PMI solid); both Services surveys - due this morning - were expected to rise in May.
S&P Global US Services PMI surged to 53.7 in May, from 52.3 flash and up from 50.8 in April (second best print of the year)
ISM Services tumbled to 49.9 in May, from 51.6 (and well below the expectation of 52.0) - lowest since June 2024
So more baffle 'em with bullshit...
Source: Bloomberg
In May, private sector output growth accelerated sharply from April’s 19-month low.
Higher activity was driven by an upturn in the services economy as manufacturing output fell marginally again.
The S&P Global US Composite PMI® recorded 53.0 in May, up from 50.6 in the previous month - leading all the other major global economies.
Source: Bloomberg
“Service sector growth has improved more than first estimated in May, with confidence about the year ahead also lifting higher, buoyed in part due to pauses on higher rate tariffs. Companies have matched that optimism with increased spending and hiring," according to Chris Williamson, Chief Business Economist at S&P Global Market Intelligence.
“That said, the improvements come from a low base, following a very gloomy April, which saw growth nearly stall as confidence sank to a two-and-half year low. Reports from companies underscore how uncertainty about the policy outlook continued to act as a deterrent to expansion plans in May. Output growth and confidence consequently remain subdued by standards seen last year.
“The PMI is so far indicating annualized GDP growth barely above 1% in the second quarter, so avoiding recession but adding to our expectation of only modest GDP growth in 2025 of just 1.3%."
However, as Williamson concludes, the stench of stagflation remains:
“Alongside sluggish economic growth, the survey is also signaling intensifying inflationary pressures. Rising costs in the service sector were again blamed widely on tariffs, which were in turn passed on to customers to result in the steepest rise in average prices charged since August 2022.
These rising price pressures will only add to policymaker reluctance to reduce interest rates, which we consequently expect to remain on hold until December."
So, you decide: ISM Manufacturing UGLY , ISM Services UGLY ; Manufacturing PMI STRONG , Services PMI STRONG !
Tyler Durden
Wed, 06/04/2025 - 10:08 Close
Wed, 04 Jun 2025 14:04:36 +0000 Bank of Canada Keeps Rates At 2.75% As Expected, As It Waits To See Impact Of Trump Tariffs
Bank of Canada Keeps Rates At 2.75% As Expected, As It Waits To See Impact Of Trump Tariffs
The Bank of Canada held interest rates steady at 2.75% for a second straight meeting - matching economist and market estimates - but warned
Read more.....
Bank of Canada Keeps Rates At 2.75% As Expected, As It Waits To See Impact Of Trump Tariffs
The Bank of Canada held interest rates steady at 2.75% for a second straight meeting - matching economist and market estimates - but warned there may be a need to cut borrowing costs if the economy weakens more and inflation remains contained as US tariffs strike. The central bank provided slight forward guidance by saying it will continue to assess the timing and strength of both the downward pressures on inflation from a weaker economy and the upward pressures on inflation from higher costs.
Also, the central bank said it is "proceeding carefully, with particular attention to the risks and uncertainties facing the Canadian economy. These include: the extent to which higher US tariffs reduce demand for Canadian exports; how much this spills over into business investment, employment and household spending; how much and how quickly cost increases are passed on to consumer prices; and how inflation expectations evolve ".
BOC officials said they held borrowing costs steady as they gain more information on Trump's trade conflict, which they called “the biggest headwind facing the Canadian economy” as it slams exports and adds to uncertainties for consumers and businesses. At the same time, policymakers said the economy held up stronger than expected in the first quarter, and flagged a recent surge in core inflation measures.
“With uncertainty about US tariffs still high, the Canadian economy softer but not sharply weaker, and some unexpected firmness in recent inflation data, governing council decided to hold the policy rate as we gain more information on US trade policy and its impacts,” policymakers said in a statement.
And while they said there was “clear consensus” amofng governing council to pause and wait for more information on how the trade dispute plays out, the bank introduced some limited guidance on where borrowing costs are likely headed.
“On balance, members thought there could be a need for a reduction in the policy rate if the economy weakens in the face of continued US tariffs and uncertainty, and cost pressures on inflation are contained,” Macklem said in his opening remarks, adding that policymakers had a “diversity” of views on the future rate path.
Some more highlights from today's decision, starting with...
Tariffs:
Recent surveys indicate that households continue to expect that tariffs will raise prices and many businesses say they intend to pass on the costs of higher tariffs. The Bank will be watching all these indicators closely to gauge how inflationary pressures are evolving.
The outcomes of these negotiations are highly uncertain, tariff rates are well above their levels at the beginning of 2025, and new trade actions are still being threatened. Uncertainty remains high.
Economy
The Bank's preferred measures of core inflation, as well as other measures of underlying inflation, moved up.
The economy is expected to be considerably weaker in the second quarter, with the strength in exports and inventories reversing and final domestic demand remaining subdued.
Policy
"We are focused on ensuring that Canadians continue to have confidence in price stability through this period of global upheaval."
'We will support economic growth while ensuring inflation remains well controlled."
We will continue to assess the timing and strength of both the downward pressures on inflation from a weaker economy and the upward pressures on inflation from higher costs."
As Bloomberg notes, the statement shows the central bank is comfortable waiting for clearer signals on how the trade dispute will evolve. At the same time, policymakers are actively discussing resuming monetary easing should the economy deteriorate and inflation remain under control. A weakening economy for the rest of the year is the base case in Bloomberg survey of economists, with gross domestic product forecast to contract in the middle two quarters of this year. Inflation is seen averaging around the bank's 2% target throughout 2025.
When the bank paused in April for the first time this easing cycle , it abandoned point estimates for gross domestic product and inflation for the first time since the Covid-19 crisis. Instead, central bankers offered two potential scenarios for the economy. It mentioned neither of these scenarios in the communications on Wednesday.
Trump has applied tariffs on a variety of Canadian goods, including steel, aluminum, autos and products that don’t comply with the North American trade pact. Uncertainty remains elevated as the administration appeals a court ruling that overturned many of his tariffs. That ruling did not apply to his sectoral levies, and Trump signed an order Tuesday doubling the metals tariffs to 50%.
In the statement, the bank said it would continue to monitor how tariffs reduce demand for Canadian exports and how it affects business investment, employment and household spending. Officials are also watching inflation expectations and how higher tariff costs are passed through.
Macklem said it was “still too soon to see the direct effects of retaliatory tariffs in consumer price data,” referring to the levies Prime Minister Mark Carney has levied on imports of some US goods, and which are currently tallying well below the total C$20 billion the federal government is expecting.
Core inflation measures surged to 3.2% in April, the highest in more than a year. While Macklem repeated that the bank is seeing “some unusual volatility” in core gauges, he also said that the measures “suggest underlying inflation could be firmer than we thought.” Higher food prices, brought on by trade disruption, may be partially responsible, the bank said.
At 2.75%, the benchmark overnight rate is at the midpoint of officials' estimate for the neutral range, where policymakers believe borrowing costs are neither stimulative nor restrictive.
Macklem and Senior Deputy Governor Carolyn Rogers are scheduled to speak to reporters at 10:30am Ottawa time.
In kneejerk response, there has been limited follow-through seen in CAD following the BoC's decision despite some outside bets for the Bank to pull the trigger on another 25bps rate cut on account of soft growth metrics and ongoing uncertainty presented by the trade war. Instead, the recent uptick in inflation appears to have supported the decision to leave rates unchanged. On which, Governor Macklem says there was a "clear consensus” with the board wishing to hold policy until it gains more information. Going forward, policy decisions will likely weigh the downward pressure on inflation from a weaker economy and upward pressures on inflation from higher costs. USD/CAD was little changed with the pair pivoting around the 1.37 mark. Year-end pricing for further easing by the BoC moved from around 42bps pre-release to 37bps.
Tyler Durden
Wed, 06/04/2025 - 10:04 Close
Wed, 04 Jun 2025 13:45:00 +0000 Zelensky Says More Russia Talks 'Pointless' With Current Delegations
Zelensky Says More Russia Talks 'Pointless' With Current Delegations
Ukraine's President Volodymyr Zelensky said Wednesday that to continue peace talks in Istanbul between Ukraine and Russia with the current delegations is senseless
Read more.....
Zelensky Says More Russia Talks 'Pointless' With Current Delegations
Ukraine's President Volodymyr Zelensky said Wednesday that to continue peace talks in Istanbul between Ukraine and Russia with the current delegations is senseless, and he has again called for talks with Vladimir Putin, after complaining that the Russian leader is sending junior officials who have no decision-making capacity.
"We are ready for exchanges, but to continue diplomatic meetings in Istanbul at a level that does not solve anything further, I think, is pointless ," Zelensky said at a press conference, referring to the latest prisoner of war (POW) swaps.
Source: website of the President of Ukraine
He had described just after the Monday Istanbul meeting that the delegations “exchanged documents through the Turkish side, and we are preparing a new release of prisoners of the war."
They agreed to another large prisoner swap, but little else, as the Russian side has continued to press demands that Ukraine forces leave the four eastern territories annexed by Russia.
But it's what preceded the talks which speaks the loudest , as Ukraine launched its 'Operation Spider's Web' deep inside Russian territory, taking out many Russian aircraft including long-range strategic bombers in what was arguably Ukraine's most successful and brazen cross-border operation to day.
Over the weekend, three bridges in Russia's south were also blown up in suspected Ukrainian sabotage operations, which left trains derailed, and killed at least seven people.
Following that, on Tuesday underwater explosives damaged and briefly crippled Kerch Bridge in what Ukrainian media is calling a 'message to Putin' . So clearly by the looks of it, Ukraine doesn't seem too interested in being at the negotiating table, after complaining that it won't cede to pressure from Washington on giving up territory.
The timing of Sunday's huge drone operation strongly points to Zelensky's desire to come up with greater leverage before serious negotiations are had. For now it seems Kiev wants to sabotage the Istanbul process, while rejecting Trump efforts for a hasty settlement.
For both rounds of talks, Putin had tapped his aide and former culture minister Vladimir Medinsky to lead. From the start many Western analysts claimed this was an 'insult' given that it is not someone more senior. Medinsky, it should be remembered, oversaw the failed 2022 peace talks with Kiev in the weeks after the February invasion.
Gathered around Medinsky were a group of mid-ranking advisers, including officials from the Foreign and Defense Ministries, along with Putin aides - but there was no Lavrov there or someone equivalent to his stature.
Tyler Durden
Wed, 06/04/2025 - 09:45 Close
Wed, 04 Jun 2025 13:05:00 +0000 Chinese Nationals Caught Smuggling "Agroterrorism" Fungus Into America's Breadbasket
Chinese Nationals Caught Smuggling "Agroterrorism" Fungus Into America's Breadbasket
In a plot that reads like a Tom Clancy novel crossed with a dystopian agribusiness nightmare , two Chinese nationa
Read more.....
Chinese Nationals Caught Smuggling "Agroterrorism" Fungus Into America's Breadbasket
In a plot that reads like a Tom Clancy novel crossed with a dystopian agribusiness nightmare , two Chinese nationals , Yunqing Jian, 33, and Zunyong Liu, 34, have been slapped with federal charges for allegedly smuggling a biological ticking time bomb into the U.S.
The weapon? Fusarium graminearum, a fungus dubbed a "potential agroterrorism weapon" by scientific literature, capable of wreaking havoc on America's wheat, barley, maize, and rice crops while poisoning humans and livestock with its toxic byproducts.
The stage? Detroit Metropolitan Airport, where Liu's clumsy attempt to sneak the pathogen past Customs and Border Protection (CBP) officers unraveled faster than a cheap yuan store sweater.
The Department of Justice dropped the hammer on Tuesday, June 3, 2025, charging Jian and Liu with conspiracy, smuggling, false statements, and visa fraud.
Jian, a postdoctoral researcher at the University of Michigan's Molecular Plant-Microbe Interaction Laboratory , and her boyfriend Liu, a researcher at Zhejiang University in China, allegedly conspired to bring this crop-killing fungus to a U.S. lab for "research."
But let's cut through the academic veneer: Fusarium graminearum isn't your garden-variety mold. It causes "head blight," a disease that can devastate staple crops, costing global agriculture billions annually.
Worse, its toxins induce vomiting, liver damage, and reproductive issues in humans and animals . In the wrong hands, it's a bioweapon straight out of a Pentagon threat assessment.
The story begins in July 2024, when Liu landed in Detroit on a tourist visa, claiming he was visiting his girlfriend. CBP officers, not buying the innocent tourist act, searched his luggage and found four plastic baggies stuffed with reddish plant material, later confirmed to be laced with Fusarium graminearum . Liu initially played dumb, insisting someone must have planted the stuff in his bag—a story that collapsed faster than China's commercial real estate bubble.
After squirming under questioning, he admitted to hiding the samples in a wad of tissues to dodge CBP scrutiny, intending to deliver them to Jian's lab at the University of Michigan for "research."
But the plot thickens. Electronic communications between Jian and Liu, uncovered by the FBI, suggest this wasn't a one-off. Messages from 2022 show Jian discussing how to smuggle biological materials past CBP, even boasting about hiding samples in her shoes during a previous trip. In early 2024, she reportedly arranged for an associate in China to mail a book with a plastic bag of material hidden inside. And then there's the kicker: Jian's phone contained a signed pledge of loyalty to the Chinese Communist Party (CCP), alongside evidence of funding from a Chinese government-backed foundation for her research on—surprise, surprise—Fusarium graminearum. Liu's phone wasn't clean either, harboring an article titled "2018 Plant-Pathogen Warfare Under Changing Climate Conditions," which explicitly flags the fungus as a crop-destroying threat .
The FBI's counterintelligence division, not known for chasing shadows, labeled this a "grave national security concern ." U.S. Attorney Jerome Gorgon didn't mince words, calling the smuggling attempt a deliberate move to introduce a pathogen that could paralyze America's agricultural crop belts .
Cheyvoryea Gibson, Special Agent in Charge of the FBI's Detroit Field Office, echoed the sentiment, framing the charges as a "crucial advancement" in safeguarding national security. Even CBP's Marty Raybon chimed in, emphasizing the agency's role in stopping biological threats that could "devastate our agricultural economy. "
Jian, now in custody and deemed a flight risk, appeared in a Detroit federal court on Tuesday, where a judge ordered her held without bond pending a hearing. Liu, meanwhile, was sent back to China after his airport interception; his current whereabouts are unknown. Both have a history with the fungus, having co-authored multiple papers on Fusarium graminearum since 2014, which raises questions about how long this scheme was in development . Denials of involvement appear to have crumbled under the weight of text messages suggesting Jian was already cultivating the pathogen in the Michigan lab before Liu's arrival.
Now, let's connect the dots the mainstream won't touch. The CCP's fingerprints are all over this. Jian's funding ties to a Chinese government-backed foundation and her pledged allegiance to the Party aren't exactly subtle. Liu's role at Zhejiang University, a known hub for CCP-aligned research, only adds fuel to the fire.
Posts on X are buzzing , with users like @TrashDiscourse connecting the dots on potentially broader PLA strategies.
Skeptics might argue that this is just a case of overzealous researchers cutting corners for the sake of science. However, when factoring in the CCP connections and the pathogen's classification as a potential bioweapon , the "innocent scientist" narrative starts to look like a fairy tale for gullible NPR listeners.
The bigger picture is grim . America's food supply is a soft target, and a well-placed pathogen could collapse the Midwest's grain belt, spike food prices, and sow chaos in an already fragile economy.
With global tensions simmering and China flexing its biotech muscle, this incident raises red flags about what else might be slipping through the cracks. The University of Michigan, caught flat-footed, now faces scrutiny over its lax oversight of foreign researchers . And while Jian sits in a Detroit cell, the question lingers: how many other "researchers" are out there, quietly probing America's vulnerabilities?
This isn't just a smuggling bust—it's a wake-up call . America's already fragile food supply chain may be the next target in a broader campaign of irregular warfare by a foreign adversary.
From exporting fentanyl precursor chemicals to Mexican cartels—subsidized by Beijing and now causing over 100,000 U.S. deaths annually among working-age adults—to undermining national readiness by taking out military-aged men and women, China appears to be playing the long game: destabilizing America from within .
This is yet another reminder of why Americans must secure local food supply chains—whether that means strengthening ties with nearby farmers and ranchers or simply starting a backyard garden or chicken coop.
Tyler Durden
Wed, 06/04/2025 - 09:05 Close
Wed, 04 Jun 2025 12:24:37 +0000 US Futures Flat As Global Stocks Hit New All Time High
US Futures Flat As Global Stocks Hit New All Time High
US equity futures are higher, following European and Asian markets, while the MSCI All-country world index surpassed the February record high: as if April never happened. As of
Read more.....
US Futures Flat As Global Stocks Hit New All Time High
US equity futures are higher, following European and Asian markets, while the MSCI All-country world index surpassed the February record high: as if April never happened. As of 8:00am, S&P futures are up 0.2%, trading just shy of 6,000 and on the verge of a 20% bull market rebound from the April low even with some negative trade developments overnight: Trump said that China’s Xi is very tough to make a deal with, and signed an order to raise steel and aluminum tariffs to 50% from 25%. Nasdaq 100 futures are up roughly the same, with Mag 7 names mostly higher premarket led by NVDA (+0.9%) and TSLA (+0.8%). Bond yields and USD are flat; Commodities are mostly unchanged as well, although Ags are higher and gold dips. Trump says Xi is “extremely hard” to make a deal with (here); the White House said that they are expecting a Trump-Xi call this week. The 50% steel tariffs will take effect today; key macro data to watch are May ADP employment change (8:15am), S&P Global US services PMI (9:45am) and ISM services index (10am).
In premarket trading, Magnificent Seven stocks are mostly higher (Nvidia +0.7%, Tesla +0.6%, Meta +0.5%, Amazon (+0.5%, Alphabet +0.4%, Microsoft 0%, Apple -0.5%).Here are some other notable premarket movers:
CrowdStrike shares (CRWD) fall 6.8% in premarket trading after the cybersecurity company posted disappointing first-quarter subscription revenue due to an impact from programs related to its post-outage Customer Commitment Package (CCP). Its second-quarter sales forecast also underwhelmed, while an unchanged view on full-year revenue was seen as negative by some analysts. Evecore ISI and Canaccord downgraded the stock.
Dollar General shares (DG) rise 0.6% in premarket trading on Wednesday as Oppenheimer & Co raised to outperform from market perform citing a “brighter intermediate-term outlook” for the discount store chain’s stock.
Guidewire (GWRE) advances 14% in US premarket trading after the software company boosted its revenue guidance for the full year, exceeding analyst estimates.
Lumentum shares (LITE) are up 6.9% in premarket trading, after the maker of optical and photonic products raised its fourth-quarter forecast. Analysts are positive on the update, and singled out margins as an area of strength.
Snowflake (SNOW) rises 2.4% in premarket trading on Wednesday UBS raised to buy from neutral saying the company is early in a multi-year data investment cycle. .
Overnight, Trump’s comments on social media about Xi in which he said "he is VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH!!!" cast doubt over their fragile economic truce, while China is also said to be considering placing a major order with Airbus, a blow for America’s biggest exporter, Boeing. There’s also wrangling over Trump’s massive tax bill. Elon Musk slammed the bill as a budget-busting “abomination,” while Senate Majority Leader Thune said the House SALT deal will have to change.
“It’s really getting complicated for investors to position themselves given the lack of visibility, the uncertainty and with markets fully valued,” said Roland Kaloyan, head of equity strategy at Societe Generale SA.
While some economists fear a notable weakening in US employment in the coming months under the weight of tariffs, that hasn’t shown up in the data yet. The muted impact has lifted optimism and helped offset concerns over President Donald Trump’s trade policies, which economists have warned could lead to an economic slowdown. Investors will follow services data and ADP’s report on private-sector employment later Wednesday for updated information on the strength of the US economy, ahead of Friday’s nonfarm payrolls report.
Options traders are betting the S&P 500 will post its smallest swing in months following Friday’s employment report, highlighting how the recent data has calmed investor worries over the economic impact of Trump’s tariffs. The S&P is projected to move 0.9% in either direction on Friday, according to data compiled by Piper Sandler. That figure, based on the prices of S&P 500 options straddles as of Tuesday’s close, is the smallest implied swing ahead of a jobs print since February.
“The fact is that everybody was waiting for the US economy to break, but the jobs data from yesterday demonstrates that it’s not, ” said Benjamin Melman, chief investment officer at Edmond de Rothschild Asset Management. “As far as institutional investors are concerned, this is the most hated rally in a while.”
Meanwhile, with US futures little changed but on the cusp of a bull market, the MSCI All-Country World Index hit an all-time peak for the first time since February .
Global investors have dry powder to buy dips and this will help the “unloved rally” continue in the absence of strong negative news, according to strategists at Barclays. But no-one seems enthusiastic. “As far as institutional investors are concerned, this is the most hated rally in a while ,” said Benjamin Melman, chief investment officer at Edmond de Rothschild Asset Management.
Still, technicals might suggest US equities are poised for a breakout. And with Nvidia reclaiming the title of the world’s largest company, the Mag 7 stock bounce has been greater than the corresponding P/E multiple expansion.
In Europe, the Stoxx 600 is up 0.7%, having extended gains after EU Trade Commissioner Sefcovic said trade talks with the US are “advancing in the right direction at pace” in a post on X. The DAX outperforms its regional peers, rising 1% after the German cabinet approved a package of tax breaks for companies worth an estimated €46 billion. Miners and technology shares lead gains, with chipmakers rallying after US peer ON Semiconductor reported a recovery in demand. Personal-care stocks and autos lag. Among individual movers, Airbus advances following a report that China is considering placing an order for hundreds of aircraft as soon as next month. Here are the biggest European movers:
European chipmakers rally after US peer ON Semiconductor said it started to see signs of a broad-based recovery in demand. Infineon, STMicro, AMS-Osram, and Nordic Semi are among gainers.
Airbus shares rise as much as 4.1% after Bloomberg reported that China is considering placing an order for hundreds of the planemaker’s jets as soon as next month.
Elisa shares gain as much as 3.5% after Morgan Stanley raised its price target on the Finnish telecommunications firm, saying the firm is well-insulated from uncertain macro and geopolitical conditions.
Camurus shares soar as much as 26%, the most since April 2020, after the Swedish biopharmaceutical company signed a licensing agreement with Eli Lilly allowing the US weight-loss drugmaker to develop and commercialize therapies using Camurus’ FluidCrystal technology.
B&M shares slide as much as 2.9% after the company issued in-line guidance for the new financial year, causing it to give back some of the gains booked since its last update in March.
Remy Cointreau shares climb as much as 2.3%, rebounding from an initial slump, after the cognac-maker scrapped its 2029-30 guidance due to the impact of US-China tariffs. Some brokers noted that the withdrawal was expected in the market.
Paragon Banking Group gains as much as 7.5%, climbing to its highest since April 2007, after the UK lender increased its full-year net interest margin guidance and delivered what analysts view as solid first-half results.
Thyssenkrupp Nucera rises as much as 12%, the most since April, after the firm was commissioned to carry out a study for a water electrolysis plant in Europe.
DiscoverIE shares jump as much as 12%, hitting their highest level since January, after the electronics company delivered annual results ahead of expectations and lifted its medium-term margin target.
S4 Capital shares rise as much as 6.2% as analysts said the media company’s slightly weaker revenue growth guidance is unsurprising and its earnings target is still intact.
Redcare shares drop as much as 14% after Kepler Cheuvreux cut its rating on the stock to hold from buy, saying the online pharmacy will struggle to sustain momentum for e-scripts when the voluntary digital identification system known as GesundheitsID kicks in.
Carmila shares fall as much as 8.7% after supermarket operator Carrefour sold a 7% stake in the French real estate group.
“Europe is still cheap but that steep discount is no longer there,” An Do, portfolio manager at Julius Baer, told Bloomberg TV. “There is still room for US assets that are truly unique. The Magnificent 7, or large cap tech, is still growing earnings at high 30% year-on-year.”
Earlier in the session, Asian stocks gained, led by South Korea as investors cheered the presidential election victory of Lee Jae-myung, which is seen potentially driving another leg up for the market. The MSCI Asia Pacific Index rose as much as 0.9%, with TSMC and SK Hynix among the biggest boosts to the benchmark. Korea’s Kospi jumped 2.7% to enter a technical bull market. The outcome of Korea’s election ended a months-long political leadership vacuum, and is fueling bets on further progress in the nation’s corporate reform drive. Hong Kong shares trimmed gains after President Donald Trump called Xi Jinping very tough to make a deal with, underscoring mounting uncertainty over the progress of US-China trade talks. Investors are also digesting the impact of higher US tariffs on steel and aluminum, after Trump officially signed a directive doubling the levy to 50%.
In FX, The Bloomberg Dollar Spot Index falls 0.1%. The Norwegian krone is leading gains versus the greenback, rising 0.5%. The euro adds 0.2% after euro-area composite PMI was revised higher to show a modest expansion rather than a contraction in May.
In rates, treasury long-end yields are about 1bp richer on the day while front-end is about 1bp cheaper, flattening the yield curve slightly. US 10-year yields are 1bp higher at 4.46% with bunds and gilts in the sector trading slightly cheaper; long end’s slight outperformance flattens 5s30s curve by about 2bp. Price action in European core rates is similarly muted, and US stock and oil futures trade near Tuesday’s highs. Gilts lead a selloff in European government bonds with UK 10-year yields rising 3 bps to 4.67%. Focal points of US session include ADP employment and ISM services gauge and Bank of Canada rate decision. Dollar swap spreads remain near Tuesday’s highs, following a late jolt higher after report that Wells Fargo & Co. has been released from a Federal Reserve asset cap that restricted its size for more than seven years
In commodities, oil prices edge lower after a two-day gain as rains slowed the growth of some blazes that had disrupted Canadian crude production. WTI falls 0.3% to $63.20. Spot gold climbs $10 to around $3,363/oz.
Looking at today;s US economic data includes May ADP employment change (8:15am), S&P Global US services PMI (9:45am) and ISM services index (10am). Fed releases latest Beige book at 2pm. Bank of Canada rate decision expected at 9:45am. Fed speaker slate includes Bostic and Cook at 8:30am
Market snapshot
S&P 500 mini +0.2%
Nasdaq 100 mini +0.1%
Russell 2000 mini +0.4%
Stoxx Europe 600 +0.6%
DAX +1%, CAC 40 +0.8%
10-year Treasury yield +1 basis point at 4.46%
VIX -0.2 points at 17.49
Bloomberg Dollar Index -0.1% at 1212.2
euro +0.2% at $1.1392
WTI crude -0.3% at $63.25/barrel
Top Overnight News
President Trump said Wednesday that it was “extremely hard” to make a deal with his Chinese counterpart Xi Jinping, at a time when the White House has been suggesting the two leaders could talk this week amid rising trade tensions. CNBC
US President Trump invited the Senate Financial Committee to the White House with the meeting reportedly to be held at 16:00EDT on Wednesday.
OMB Director Vought said the rescission package sent on Tuesday is just the start and they chose the easiest DOGE cuts to start rescissions, while he added there are consequences for Congress failing to rescind. Vought said the rescission package will be on the floor next week and they will send many more rescissions once this passes, as well as noted that they have tools to make cuts permanent by the end of the FY.
BLS said some April jobs data will be corrected on Friday and major measures such as the unemployment rate are unaffected, while it added that many numbers are to be corrected but the impact is 'negligible'.
China is considering placing an order for hundreds of Airbus jets as soon as next month, people familiar said, adding to tensions as Beijing keeps Boeing on the sidelines. BBG
Bank of Japan Governor Kazuo Ueda said the country’s economy can withstand the hit from U.S. tariffs and sustain a cycle of rising inflation accompanied by wage growth, signaling the bank’s readiness to raise interest rates further. CNBC
Trump’s doubling of steel and aluminum tariffs to 50% took effect with the UK exempt from the increase. Mexico will also seek a reprieve later this week. BBG
Germany’s new government will seek to pass a 46bn package of corporate tax breaks over the summer in an effort to jolt the Eurozone’s largest economy of stagnation. FT
Eurozone countries are preparing for a series of difficult negotiations w/Trump over trade, NATO, and Ukraine. FT
Eurozone’s final services PMI for May came in at 49.7, up from the flash reading of 48.9. BBG
Wells Fargo stock rose premarket (+2.97%) after the Fed lifted an asset cap that has restricted its size for more than seven years. BBG
Traders are ramping up hedges against dramatic shifts in the Fed’s rate path. While the swaps market still sees two cuts this year, uncertainty has pushed traders to buy protection for a wider range of outcomes, including no cuts at all. BBG
A more detailed look at global markets courtesy of Newsquawk
APAC stocks traded mostly higher following the gains on Wall St where sentiment was lifted by better-than-expected JOLTS data and with some slight optimism with US President Trump and Chinese President Xi reportedly set to speak this Friday. ASX 200 was led higher by outperformance in the energy sector and with participants unfazed by recent data releases including the miss on Q1 GDP. Nikkei 225 advanced at the open following recent currency weakness but with further upside capped by a lack of drivers. KOSPI outperformed and is on course for a bull market following the Presidential Election which was won by the DP's Lee Jae-Myung who was later sworn in. Hang Seng and Shanghai Comp conformed to the positive mood but with gains capped as China remained quiet regarding a potential Trump-Xi call.
Top Asian News
NIO’s Hong Kong-listed shares advance as much as 4.4% after the Chinese electric-vehicle maker said it aimed to reduce research and development spending to reach its fourth-quarter break-even target. Meanwhile, the company reported first-quarter revenue that missed consensus estimates.
CGN Mining shares gain as much as 23% in Hong Kong, the most since Oct. 22, as Morgan Stanley analysts note the nuclear energy company’s better-than-expected new pricing formula would improve earnings.
Innovent Biologics shares surge as much as 18% to the highest since Nov. 2021, after the company presented the latest clinical data of IBI363 in advanced non-small cell lung cancer.
European bourses (STOXX 600 +0.6%) opened modestly firmer across the board and have traded with an upward bias throughout the morning – currently at session highs. Aided by PMIs and potentially the readout from Sefcovic on his call with Greer. European sectors hold a strong positive bias and aside from the top performer, the breadth of the market is fairly narrow. The European auto sector has been in focus today, with European auto supplier association, Clepa, suggesting production lines and plants have already been shut and the impact will likely grow in the next 3-4 weeks. This sparked some modest pressure in the sector.
Top European News
European auto supplier association Clepa says production lines and a couple of plants are already shut due to China rare earth export curbs; impact likely to grow in the next 3-4 weeks, and only 1/4 of licence requests have been granted since early April.
Germany is said to be seeking to pass a package of EUR 46bln in corporate tax breaks, according to FT.
Germany's VDMA says April orders -6% Y/Y (domestic -4%, foreign -7%).
"[UK Chancellor] Rachel Reeves rules out increasing income tax, NI and VAT for 'working people' in the autumn Budget, saying she will stick to her manifesto pledges despite tight public finances", via Jason Groves on X. Will be making changes to the winter fuel payments, so they can be paid this winter (As expected).
UK Chancellor Reeves says, "I have no intention of raising taxes again on the scale of 2024 budget".
FX
DXY is fractionally lower following Tuesday's session of gains which were in part a bounce back from Monday's losses and supported by JOLTS data. On the trade front, markets await the call between Trump and Xi on Friday. Ahead of which, Trump has posted that his Chinese counterpart is "very tough, and extremely hard to make a deal with". Ahead, attention will be on the data slate with ADP due on deck ahead of Friday's all-important NFP print. Elsewhere, ISM services and the Fed's Beige Book are also set to be released. DXY currently trading around 99.03.
EUR is a touch firmer vs. the USD but stuck on a 1.14 handle following a soft EZ inflation release in the run-up to Thursday's ECB policy announcement (25bps cut is pretty much nailed on). Elsewhere, on the data front; an upward revision to the EZ composite PMI into positive territory has little follow-through into EUR with EUR/USD currently topped out at 1.1396.
JPY is flat vs. the USD but holding onto most of the prior day's spoils after returning to the 144.00 territory amid a firmer buck and the positive risk tone. Incremental newsflow out of Japan has been on the light side aside from Japanese Chief Cabinet Secretary Hayashi said they have not received any letter from the US asking to make the best offers on trade talks. USD/JPY had ventured as high as 144.38 overnight before drifting back towards the top end of Tuesday's 142.37-144.11 range. GBP firmer vs. the USD and flat vs. the EUR with pertinent UK-specific newsflow lacking aside from the White House announcing that US tariffs on UK steel and aluminium will remain at 25% for now, with the UK failing to get the 0% tariffs promised in the US ‘deal’ implemented in time , according to Bloomberg. Elsewhere, an upward revision to UK services PMI had little impact on the GBP.
Antipodeans are both a touch firmer vs. the slightly softer USD with AUD able to overlook disappointing Australian GDP data which has heightened calls for a looser approach by the RBA. Both currencies will be eyeing the outcome of the Trump-Xi call on Friday given that China is both of their largest trading partners.
CAD is flat vs. the USD ahead of today's BoC policy announcement. The BoC is expected to keep rates on hold at 2.75%, although some (6/26 surveyed by Reuters) expect a 25bps rate cut; markets price such an outcome at 30%. USD/CAD is currently tucked within Tuesday's 1.3701-43 range.
PBoC set USD/CNY mid-point at 7.1886 vs exp. 7.1977 (Prev. 7.1869).
Fixed Income
USTs started the day contained . Focus overnight was on the largely as expected implementation of Trump’s 50% steel and aluminium tariff rate for all ex-UK, which is subject to a lower 25% rate, for now. Now focus remains firmly on US-China relations and specifically on Friday's call which features the Presidents of the two countries. USTs currently hold at the low end of a 110-12+ to 110-18+ band, ahead of ISM Services and ADP National Employment.
Bunds held a slight bearish bias overnight but not particularly pronounced. This bias accelerated throughout the European morning in the wake of Final PMIs. No overly significant reaction to any one figure, but Bunds fell from 131.30 to an initial 131.04 low across the PMI window. The EZ-wide figure was revised a little higher with the accompanying commentary suggesting that ECB cuts/German fiscal spending should be enough to offset the impact of higher tariffs/uncertainty.
Most recently, EU Trade Commissioner Sefcovic said he had constructive talks with USTR Greer; are advancing in the correct direction at "pace"; a comment which may have helped push the benchmark to a 130.94 base, alongside European equity bourses picked up slightly at the time.
Gilts are under pressure throughout the morning in catch-up to the general overnight tone, the above factors (particularly PMIs) and ahead of supply. Additionally, yields pushed higher by the inflationary implications of the UK finding itself subject to 25% tariffs on metals; while better than global peers, the levy is a disappointment for those who hoped the UK-US deal would result in a full exemption .
UK Chancellor Reeves has been on the wires today, where she ruled out increasing tax for "working people" in the Autumn Budget. UK assets were little moved.
UK Sells GBP 4.75bln 4.375% 2028 Gilt: b/c 3.08x (prev. 3.48x), average yield 4.062% (prev. 3.834%) & tail 0.3bps (prev. 0.2bps).
Orders for the new Italian 5yr BTP in excess of EUR 95bln, Green BTP orders in excess of EUR 85bln, via Reuters citing leads.
Commodities
Crude has been tilting upwards in early European hours after taking a breather in APAC trade after advancing on Tuesday amid the positive risk appetite and ongoing geopolitical tensions, with demand contained overnight following mixed private sector inventory data. Tight parameters are seen across crude futures - WTI Jul resides in a USD 63.07-63.52/bbl range while Brent Aug sits in a USD 65.31-65.77/bbl band.
Mixed trade across precious metals as traders await the next macro catalyst, with spot gold and silver caged to narrow ranges. XAU/USD currently trades in a USD 3,346.53-3,372.71/oz range and well within Tuesday's USD 3,333.17-3,392.30/oz.
Spot palladium narrowly underperforms, potentially with headwinds from the European auto supplier association Clepa who said production lines and a couple of plants are already shut due to China rare earth export curbs.
Base metals are tilting firmer in tandem with upticks seen across equities , and in broader sentiment, albeit gains are capped ahead of risk events including a slew of Fed speakers, the US Jobs report on Friday, but arguably more importantly for the complex, traders await news on a potential call between US President Trump and Chinese President Xi.
US Private Inventory Data (bbls): Crude -3.3mln (exp. -1mln), Distillates +0.8 (exp. +1mln), Gasoline +4.7mln (exp. +0.6mln), Cushing +1.0mln.
Geopolitics: Middle East
Israeli military warned residents of Gaza against moving into areas leading to US-backed aid group distribution centres on Wednesday, deeming them 'combat zones'.
Gaza Humanitarian Foundation said it will not distribute any aid on Wednesday and is in talks with the Israeli military to enhance security measures beyond the immediate perimeter of GHF sites.
Ten elected UN Security Council members asked for a Wednesday vote on a draft resolution on Gaza that demands an immediate, unconditional and permanent ceasefire in Gaza and the release of all hostages held by Hamas, while it also demands immediate lifting of all restrictions on aid into Gaza and safe, unhindered distribution at scale throughout Gaza, according to Reuters citing sources.
Sirens sounded in Tel Aviv after a rocket fired from Yemen towards Israel and Houthis announced the targeting of Israel's Ben Gurion Airport with a hypersonic missile, according to Cairo News and Sky News Arabia.
Syrian Foreign Ministry said reports of launches towards Israel have not been verified yet and it affirmed that Syria will not pose a threat to any party in the region following projectile launches towards Israel. Furthermore, the Syrian Foreign Ministry said Israel's strike on Daraa caused significant human and material losses, while Syrian security sources also stated that Israel launched a series of strikes on targets in southern Syria.
US proposed an interim step in Iran nuclear talks allowing some enrichment, according to the NY Times. It was separately reported that White House Press Secretary Leavitt said Witkoff sent a detailed proposal to Iran and hopes Iran will accept the proposal, otherwise, there will be consequences, while the US State Department said the maximum pressure campaign on Iran remains in 'full force'.
Iran is open to basing a nuclear deal with the US around the idea of a regional uranium enrichment consortium, as long as it is located within Iran, according to Axios citing an Iranian official.
Iranian Supreme Leader Khamenei says Iran will increase Iran's power in all fields. The US nuclear proposal is 100% against "the principle of our power".
Geopolitics: Ukraine
Ukraine's Foreign Minister said Russia made no response to Kyiv's peace proposals at Istanbul talks and presented 'old ultimatums', while the official stated more tangible results were needed. It was separately reported that Russia's Deputy Foreign Minister said Istanbul will remain the venue for Russia-Ukraine talks, and no other venues are on the table, according to TASS.
White House Press Secretary Leavitt said President Trump is keeping sanctions on Russia as a tool in the toolbox and Trump remains optimistic about progress in Russia-Ukraine discussions.
US Secretary of State Rubio spoke with Turkish Foreign Minister Fidan to discuss supporting direct negotiations between Russia and Ukraine.
US Special Envoy Kellogg believes the Russia Sanctions Act is "ready to drop and said he spoke to Senator Graham about Russia sanctions.
Russia's top security official Shoigu is to discuss Ukraine with North Korean leader Kim, according to Russian agencies.
Russia's Deputy Foreign Minister said NATO's planned Baltic drills are part of the alliance's preparations for a potential military clash with Russia, according to TASS.
Geopolitics: Other
South Korean President Lee said peace achieved at a high cost is better than war and he will seek dialogue with North Korea to secure peace in the Korean peninsula.
US Secretary of State Rubio commemorated the bravery of the Chinese people killed in the Tiananmen crackdown in 1989.
Taiwan's President Lai posted on Facebook regarding the Tiananmen crackdown anniversary in which he stated that authoritarian governments often choose to silence and forget history, while he added that they cannot ignore the infringement on global democracy and the rule of law caused by the expansion of authoritarianism.
US event Calendar
7:00 am: May 30 MBA Mortgage Applications -3.9%, prior -1.2%
8:15 am: May ADP Employment Change 37k, est. 113.5k, prior 62k
9:45 am: May F S&P Global U.S. Services PMI, est. 52.3, prior 52.3
9:45 am: May F S&P Global U.S. Composite PMI, est. 52.05, prior 52.1
10:00 am: May ISM Services Index, est. 52, prior 51.6
DB's Jim Reid concludes the overnight wrap
Sentiment and data haven't been great so far this week, but ever since the weak US ISM manufacturing data on Monday, markets have steadily climbed with the S&P 500 up +1.86% since the lows after it was released, including another +0.58% gain yesterday as the headline JOLTS data was broadly positive (more below). So the index is now up +19.82% since the closing low after Liberation Day, leaving it just shy of the 20% threshold that would technically mark the start of a bull market. We have the ISM services today so we'll see if that provides the same market response.
The mood was boosted yesterday by tech and semiconductors stocks, as Meta’s deal to enter a 20yr agreement with the largest US nuclear operator seemed to energise the sector. The deal was said to be cheaper than a similar one powered by Microsoft last year as it used existing facilities. It shows just how much energy demand there will be going forward from AI and the lengths these firms will go to maintain their green credentials as fossil fuels would be cheaper. I ran a "Deep Research" search last week where I uploaded a number of my previous reports and asked it to do a summary of the new World Outlook document in my style. Unfortunately it took 18 hours of processing. When I asked for updates it kept on saying "just give me 45 more minutes, I'm nearly there". In the end I gave up but I hate to think how much splitting of how many atoms was needed for it to take that long. Maybe my writing style is so chaotic it blew up their servers. I should say Deep Research is incredible but it’s trial and error as to what it does well and what it does less well.
The Philadelphia Semiconductor Index (+2.48%) took the news well, with Nvidia (+2.95%) seeing its market cap narrowly overtake Microsoft to reclaim the position of the world’s most valuable company for the first time since January. That also helped the NASDAQ outperform (+0.85%), though the Mag-7 saw only a modest gain (+0.23%) as Alphabet slid by -1.69% and Meta itself fell by -0.60%. So signs of an ongoing debate over which tech companies will gain from AI. The gains in the US also occurred in Europe, where the STOXX 600 (+0.09%), the FTSE 100 (+0.38%), DAX (+0.67%) and CAC 40 (+0.34%) all rose. On the tech theme, my colleague Marion Laboure published her tech performance review for May, which is highly relevant given the sector’s surprising uplift in recent days.
One of the most important catalysts for the recovery was that JOLTS report, which showed the US labour market in a more robust position than previously thought. Specifically, job openings unexpectedly rose to 7.391m in April (vs. 7.1m expected), so that push back against fears that companies would dial back hiring after Liberation Day. The quits rate of those voluntarily leaving their jobs did edge down a tenth to 2.0%, but that was also within its range over the last 12 months, so not a cause for alarm. The report coincided with the start of the risk-on move, with bond yields also moving higher after the release. By the close, that meant the 10yr yield (+1.4bps) was up to 4.46%, and the 30yr yield (+1.6bps) rose to 4.98%, edging closer to 5% again. The moves also got momentum from the latest rise in oil prices, with Brent crude (+1.55%) up to $65.63, its highest level in nearly three weeks.
We also had some fresh trade headlines yesterday, as Reuters reported that the Trump administration wanted countries to provide their best offer by today on the trade negotiations. As a reminder, there’s just over a month until the 90-day extension for the reciprocal tariffs runs out on July 9, so the US are trying to negotiate lots of deals before that, and Press Secretary Karoline Leavitt said that “I can confirm the merits in the content of the letter”. Leavitt also suggested that there would be a call between Trump and China’s President Xi “very soon”. Otherwise, Trump also signed the executive order yesterday that imposed the higher 50% tariffs on steel and aluminium announced on Friday, and these took effect overnight. The UK is exempt from the increase until July 9 to allow the two countries to work out new levies or quotas under the framework deal they agreed last month.
Earlier in the day, the initial market plunge seemed to coincide with the collapse of the Dutch government after the far-right Freedom Party (PVV), the largest in the Netherlands’ parliament, withdrew from the ruling coalition. The move came as other parties in the four-party coalition refused to back the PVV’s proposed migration curbs. This marks the second time in two years that a Dutch government has collapsed due to differences over migration policy. Incumbent Prime Minister Dick Schoof will continue in a caretaker role until snap elections are held. There wasn’t too much of an impact on markets however, as even though the country’s main equity index, the AEX, slid -0.75%, it had recovered by the afternoon to close up +0.21%. European bond yields also saw little movement, with 10yr bunds (unch), OATs (+0.2bps) and BTPs (-0.5bps) fairly steady, although gilts (-2.9bps) outperformed.
Elsewhere in Europe, the Euro Area flash CPI print fell to just +1.9% in May (vs. +2.0% expected), marking the first sub-2% headline print in four years (excluding the 1.7% surprise in September 2024). Moreover, core CPI was down to just +2.3%, the lowest since January 2022. The print cemented market expectations that the ECB would deliver another rate cut tomorrow, and showed that the April spike in services inflation was mostly noise associated to strong Easter effects. Underlying services inflation momentum has eased significantly and our European economists believe there’s still scope for further services disinflation.
Overnight in Asia, markets have put in a very strong performance that built on the overnight gains from Wall Street. In particular, South Korea’s KOSPI (+2.45%) has surged after the election of Lee Jae-myung as President, with the index trading at a 10-month high this morning. So if it closes at that level, it would be up more than +20% from its closing low after Liberation Day, marking the technical definition of a bull market. In addition, the country’s headline CPI print also fell to +1.9% in May (vs. +2.1% expected). But there’ve been gains across the board, with the Nikkei (+0.88%), the Hang Seng (+0.72%), the CSI 300 (+0.52%) and the Shanghai Comp (+0.43%) all advancing. Australia’s S&P/ASX 200 (+0.79%) has also risen this morning, despite underwhelming Q1 GDP figures that showed the economy only grew by +0.2% (vs. +0.4% expected). Looking forward however, US equity futures are pointing a bit lower this morning, with those on the S&P 500 down -0.04%.
To the day ahead now, data releases include the US ADP report for May and ISM services, the final services and composite PMIs from the US and Europe, and Canada’s Q1 labor productivity. Central bank speakers include the Fed’s Bostic and Cook, and we’ll also get the BoC’s decision.
Tyler Durden
Wed, 06/04/2025 - 08:24 Close
Wed, 04 Jun 2025 12:22:33 +0000 "Too Late!" - Trump Blasts Powell After Weakest ADP Jobs Report In Over 2 Years
"Too Late!" - Trump Blasts Powell After Weakest ADP Jobs Report In Over 2 Years
Following April's weak ADP print (lowest job additions since July 2024), analysts expected a rebound in May from the "unease" before Trump paused the Li
Read more.....
"Too Late!" - Trump Blasts Powell After Weakest ADP Jobs Report In Over 2 Years
Following April's weak ADP print (lowest job additions since July 2024), analysts expected a rebound in May from the "unease" before Trump paused the Liberation Day tariffs. Jobless claims, among others, have all supported signals that the labor market refuses to fold to soft data's squeamishness over Trump's policies...
Source: Bloomberg
So, against expectations of a +114k print, ADP's Employment Report came in at just +37k for May - the lowest since March 2023's decline.
Source: Bloomberg
That was a 5 standard deviation miss from expectations...
Source: Bloomberg
This is the biggest miss since August 2022...
Source: Bloomberg
Small Businesses dominated the weakness in the labor market...
Goods producing firms lost 2k jobs while Services added just 36k...
But the picture was weak across most sectors...
"After a strong start to the year, hiring is losing momentum," says Nela Richardson Chief Economist.
"ADP Pay growth, however, was little changed in May, holding at robust levels for both job-stayers and job-changers."
Source: Bloomberg
President Trump is pissed...
But bond bulls are happy...
And 2025 rate cut expectations are (dovishly) rising...
So, what's your guess for Friday's print now?
Tyler Durden
Wed, 06/04/2025 - 08:22 Close
Wed, 04 Jun 2025 11:45:00 +0000 Trump Says China's Xi Is "Very Tough And Hard To Make Deal With"
Trump Says China's Xi Is "Very Tough And Hard To Make Deal With"
President Donald Trump said in an early morning Truth Social post that Chinese leader Xi Jinping was "extremely hard " to make a deal with, just days
Read more.....
Trump Says China's Xi Is "Very Tough And Hard To Make Deal With"
President Donald Trump said in an early morning Truth Social post that Chinese leader Xi Jinping was "extremely hard " to make a deal with, just days after the president accused Beijing of violating an agreement to roll back tariffs and trade restrictions. This comes after Treasury Secretary Scott Bessent said that U.S.-China trade talks were "a bit stalled ." However, White House Press Secretary Karoline Leavitt said Tuesday that leader-to-leader talk between Trump and Xi "will happen very soon ."
"I like President XI of China, always have, and always will, but he is VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH!!! ," Trump wrote on Truth Social at around 0217 ET.
Washington and Beijing have been bickering over whether either side has violated the May 12 trade agreement , reached in Switzerland, to de-escalate the trade war for 90 days. U.S. trade officials are likely concerned about China choking off the supply of key critical minerals, including rare earth magnets, while Chinese officials are worried about the U.S. restrictions on jet engine parts .
On Tuesday, Leavitt told reporters that U.S. officials were monitoring China's compliance with the agreement and that leader-to-leader talks would happen very soon: "There will be a leader-to-leader talk very soon ."
Trump signaled last week that he would speak with Xi in the near term: "I'm sure that I'll speak to President Xi, and hopefully we'll work that out ." He told reporters that China had violated part of the trade agreement reached in Geneva, which aimed to reduce tensions.
China has yet to confirm leader-to-leader talks , but Trump and the White House have repeatedly insisted those talks are nearing and "likely" at the end of this week .
In markets, U.S. equity futures are flat early Wednesday, and Treasury yields are little changed, even as the U.S. doubled tariffs on steel and aluminum to 50%.
In a post on X late Tuesday, U.S. Ambassador David Perdue emphasized to Chinese Foreign Minister Wang Yi that the U.S.'s top priorities are trade, fentanyl, and illegal immigration.
Trade war headlines change daily and can be hard to track. That's why UBS analyst Leo He compiled a comprehensive list of the latest developments, sourcing from Bloomberg, Reuters, The Hill, and Business Insider:
New Developments Summary:
The U.S. administration wants countries to provide their best offer on trade negotiations by June 4.
CNBC reports U.S. President Trump and China President Xi are likely to speak this week. U.S. extended the exclusion of Section 301 tariffs on some Chinese goods until August 31.
The U.S. will increase global tariffs on steel and aluminum to 50% from 25%, effective June 4.
Regarding the Court of International Trade's ruling on reciprocal tariffs, the Appeals court gave deadlines of June 5 for the plaintiffs to respond and June 9 for the U.S. administration to reply.
Trade Negotiations:
Overall:
Reuters reports The U.S. administration wants countries to provide their best offer on trade negotiations by June 4 as officials seek to accelerate talks.
U.S. President Trump said he will set tariffs rates for U.S. trading partners over next few weeks due to a lack of capacity to negotiate deals with all.
The U.S. administration has laid out a framework to negotiate with 18 countries six every week, over three weeks, in a rotation until the reciprocal tariffs pausing deadline (July 8).
Finance ministers and central bank governors from the G7 nations pledged to address "excessive imbalances" in the global economy aiming to create a level playing field and increase transparency.
China:
CNBC reports U.S. President Trump and China President Xi are likely to speak this week, citing a senior White House official. Previously, U.S. Treasury Secretary Bessent said trade talks with China are moving slowly and talks between top leaders are needed to facilitate the negotiations.
U.S. and China accused each other of violating the recent trade deal. The U.S. accused China of restricting rare-earth exports while China accused the U.S. of technological controls.
U.S. extended the exclusion of Section 301 tariffs on some Chinese goods until August 31.
On May 15, U.S. Trade Representative Greer spoke to Chinese Vice Commerce Minister Li during the APEC meeting .
U.S. Treasury Secretary Bessent met China Vice Premier He during May 10-11 and reached a de-escalation agreement. The U.S. lowered tariffs on China imports to 30% including 10% universal tariffs and 20% Fentanyl tariffs. Other universal tariffs including 25%?on steel and aluminum and 25% on autos and auto parts have remained in place. Meanwhile, 24% reciprocal tariffs will be suspended for 90 days to allow for further negotiations with a deadline on August 12.
The U.S.'s weighted average tariff on China imports is lowered to 43.5% from 96%, considering Trump's first term tariffs on China.
Next meeting between Bessent and He will be in next few weeks.
Vietnam:
The U.S. has sent Vietnam a list of requests as part of tariff negotiations that could force the Southeast Asian country to reduce the use of Chinese materials and components in its factories.
Vietnam is expected to sign deals with the United States to buy more than $2 billion worth of agricultural products. Previously, Vietnam trade minister Nguyen Hong Dien urged companies to buy more U.S. energy, mining, telecommunications and aviation.
Vietnam PM Chinh asked officials to speed up negotiations, aiming to sign a purchase deal of methanol worth $6bn from the U.S. in May.
Japan:
On June 2, Japan trade Negotiator Akazawa said Japan's stance of removing all tariffs hasn't changed. Akazawa will head to the U.S. on June 5 for the 5th round of negotiations, aiming for a trade deal during the G7 meeting during June 13-15.
On May 29, Japanese Prime Minister Ishiba held a 25-minute phone call with Trump, and expressed the view that investing in the U.S. is more important than tariffs.
The U.S. agrees to Nippon Steel's acquisition plan on the United States Steel Corp, conditional on receiving a "golden share" of the company.
After meeting with U.S. Treasury Secretary Bessent, Japan Finance Minister Kato said they agreed FX should be determined by market and specific FX levels were not discussed. Previously, Japan Finance Minister Kato said Plaza Accord 2.0 hasn't come up for discussion.
On May 9, Japan Finance Minister Kato said Japan is not considering to the U.S. Treasuries holding for negotiation. Previously, Kato said Japan's U.S. Treasury Holdings is a card in trade negotiations and whether Japan will use that card is a different decision. Japan Democratic Party for the People leader Tamaki said buying super-long UST in return for concessions on tariffs should be a possible bargaining chip. The party is a small but influential opposition party.
Previously, Japan PM Ishiba said Japan will not accept a trade agreement with the U.S. that excludes an accord on autos. Previously, Nikkei reported the U.S. proposed a framework under which Washington would maintain its 25% tariffs on Japan's auto industry, as well as steel and aluminum. Japan pushed back, saying the negotiations should be comprehensive, the paper said. Tokyo suggested reviewing its non-tariff barriers and expanding imports of U.S. farm products. On May 5, Kyodo reported the U.S. has rejected Japan's full exemption from not only the 10% "reciprocal" tariff but also its country-specific tariff in recent negotiations
Japan government is discussing the possibility of leveraging shipbuilding in tariff negotiations (source )
Media reports Japan plans to increase imports of U.S. rice and soybeans as a potential bargaining chip in the trade negotiation. Also, Japan is considering into reviewing its car safety standards (read more ).
EU:
On June 2, the EU has sent a technical team to Washington for trade negotiations. Also EU Trade Commissioner Sefcovic will meet U.S. Trade Representative Greer on June 4.
EU Trade Commissioner Sefcovic said he has calls with Commerce Secretary Lutnick every other day, and they have discussed aviation and semiconductor cooperations.
The U.S. and EU have agreed to accelerate trade talks after President Trump's threat to impose 50% tariffs on the EU.
Previously, U.S. Treasury Secretary Bessent said the EU is very difficult to deal with and the EU proposals have not been of the same quality that from other trading partners. U.S. Treasury Secretary Bessent said the EU suffers from a "collective action problem" that's hampering trade negotiations. Also, he said the EU needs to resolve "internal matters" before entering trade negotiations with the U.S., specifically citing a digital service tax imposed by some EU countries.
Previously, the EU shared a revised paper with the U.S. that includes proposals on international labor rights, environmental standards, economic security and gradually reducing tariffs to zero on both sides for non-sensitive agricultural products as well as industrial goods.
Previously, EU trade commissioner Maros Sefcovic said the EU is ready to offer EUR50 bn purchases of U.S. gas and agricultural products to address the problem in the trade relationship.
The U.S. government is pushing back against the EU's AI code of practice.
UK:
The UK government said they were engaging with the U.S. on the implications of the latest tariff announcement and working to provide clarity for industry.
The UK will hold talks with the U.S. next week to speed up implementation of a trade pack between two sides.
On May 8, the US-UK trade framework was announced. Final details are still under negotiations.
The UK framework includes:
UK car makers will be allowed to export 100k cars to the U.S. with a 10% tariff, down from 27.5%.
UK farmers will be given a tariff-free quota for 13,000 metric tons of beef exports.
Tariffs on UK steel and aluminum are removed.
10% tariffs on other UK goods remained.
The UK will purchase $10 bn of Boeing procurement.
The UK will remove its tariff on U.S.?ethanol to zero.
The UK?will open access to ethanol, beef, machinery, and agricultural markets.
There will be a "fast-track" entry for U.S.?goods and vice versa for UK?goods.
The UK said the digital services tax remains unchanged, which U.S. Senior Trade and Manufacturing Counselor Navarro said it is still under negotiation
The U.S. and the UK "intend to promptly negotiate significantly preferential treatment outcomes on pharmaceuticals and pharmaceutical ingredients.
India:
U.S. Commerce Secretary Lutnick said the US-India trade deal is coming soon. Previously, India Commerce Minister Goyal said he had a constructive meeting with U.S. Commerce Minister Lutnick on trade deals.
U.S. officials will visit India on June 5-6 to speed up reaching a trade agreement.
U.S. President Trump threatened to impose 25% tariffs on Apple if iPhones are not made in the U.S. Previously, Apple aimed to import most of the iPhones it sells in the U.S. from India by the end of 2026.
On April 21, the U.S. and India announced they had agreed to broad terms of negotiation for a potential bilateral trade deal. The U.S. will seek increased market access, lower tariffs and non-tariff barriers, and a robust set of additional commitments
A US-India trade agreement under discussion covers 19 categories, including market access for farm goods, e-commerce, data storage, and critical minerals.
Negotiators will discuss contentious issues like agricultural tariffs, e-commerce market access, data storage, and critical minerals, with the goal of boosting bilateral trade to $500 billion by 2030 from $127.6 billion last year.
U.S. President Trump said India offered to remove tariffs.
India is reviewing a U.S. request to lift restrictions on ethanol imports
Modi and Trump aim to conclude the first phase of the deal by the fall of this year.
Mexico:
Mexican Economy Secretary Marcelo Ebrard expects the United States-Mexico-Canada Agreement (USMCA) review to begin between late September and early October.
Mexico President Sheinbaum said she will wait to know the full scope of U.S. court ruling on tariffs.
Sheinbaum said she discussed U.S. steel and aluminum tariffs with Trump.
Sheinbaum said she welcomed the decision by U.S. lawmakers to reduce a proposed tax on remittances to 3.5% from 5% but will continue fighting for these payments to be tax free.
U.S. has suspended imports of live cattle, horses and bison from Mexico due to screwworm.
Mexican President Claudia Sheinbaum said there's no sign that the USMCA is going to end.
The U.S. and Mexico reached agreements on resolving conflicts over water delivery and the New World screwworm pest, de-escalating the conflict.
Mexico's President Claudia Sheinbaum said she discussed steel, aluminum and cars with U.S. President Donald Trump, but they did not yet reach a deal. Trade talk continues.
Canada:
Canada Prime Minister Carney said he welcomed the U.S. court ruling on tariffs.
Canada Finance Minister Champagne and U.S. Secretary Bessent spoke on the sidelines of the G7 finance minister meeting.
Canada PM Carney met U.S. President Trump on May 6.
Trump indicated he would strike a friendlier relationship with Canadian Prime Minister Mark Carney, but cast doubt on whether Carney could convince him to lift tariffs on Canada.
Switzerland:
Switzerland will discuss with the U.S. easing market access for some agricultural products and simplifying approval for medical devices in order to avert damaging tariffs on its exports.
SNB President Schlegel said he had a constructive conversation with the U.S. on FX, and Switzerland is not an FX manipulator.
Swiss Confederation President Keller-Sutter said Switzerland might be the next country to sign a U.S. tariff deal, and the letter of intent will be submitted in next 1-2 weeks. And the U.S. would refrain from imposing new tariffs on Switzerland.
South Korea:
South Korea's finance ministry said they have an ongoing FX talks with the U.S. counterpart, but no decision has been made. Earlier today, Korea Economic Daily reported that U.S. believes the fundamental cause of the massive U.S. trade deficit is due to strong USD.
On May 16, South Korea Trade Minister Inkyo said a US-Korea trade deal is impossible before the election. Inkyo said the U.S. wants to keep its 10% baseline tariffs.
U.S. and Korea agreed to share a mutual understanding of the principles they hold for FX operation and would continue to discuss the FX policy.
South Korean officials have said cooperation on shipbuilding is a "very important card" the country holds, while participation in an Alaska gas project could be part of a negotiation package, but defense costs were not up for negotiations.
Taiwan:
Taiwan Deputy Finance Minister Chen said Taiwan will continue its efforts to secure a trade deal with the U.S., despite the court ruling.
On May 15, Taiwan trade negotiator Yang meet U.S. Trade Representative Greer.
Taiwan central bank governor Yang said the U.S. did not ask Taiwan to increase the value of TWD during trade talk.
Offered zero tariffs.
Thailand:
Thailand has submitted proposals to the U.S. including buying more U.S. goods and encouraging firms to invest in the U.S.
Thailand is interested in co-developing a massive gas pipeline project in Alaska. Thailand is also open to signing a long-term contract to import 3 to 5 mn tons of LNG from Alaska annually.
U.S. wants Thailand to take more steps to prevent certificate of origin misuse by other countries. Also, the U.S. wants Thailand to look into its concerns over FX manipulation.
Brazil:
Brazil President Lula has signed agreements with China on Chinese investment, credit lines and purchasing agricultural products.
Lula said will defend fair trade based on WTO rules.
On May 4, Brazil Finance Minister Haddad met with U.S. Treasury Secretary Bessent to discuss tariffs and efforts to attract investments in green energy and critical minerals..
Saudi Arabia:
Israel: Offered to eliminate its trade deficit with the U.S.
Argentina: "to readjust the regulations so that we meet the requirements of the reciprocal tariffs proposal developed".
Bangladesh: Offered to substantially increase its imports of U.S. goods.
Cambodia: Offered to cut tariffs on U.S. imports from 35% to 5%.
Tariffs Tracker:
Court of International Trade Ruling:
Ruling:
10% universal reciprocal tariffs, 30% border/fentanyl tariffs on China, 25% border/fentanyl tariffs on Mexico and Canada goods, and de minimus tariffs are ruled illegal as the administration exceeded what authority it has under the 1977 International Emergency Economic Powers Act.
Meanwhile, sector tariffs and tariffs under Trump's first term remain in place.
The administration needs to remove these tariffs within 10 days from May 28.
The ruling avoids about one-third of new tariffs announced this year.
Appeal:
The administration has filed an appeal for the ruling to the Appeals Court for the Federal Circuit, and may eventually go to the Supreme Court.
The Appeals court allows tariffs to stay during the process.
The Appeals court gave deadlines of Thursday, June 5 for the plaintiffs to respond and June 9 for the U.S. administration to reply.
Alternative Ways:
Section 122: The president can impose universal tariffs up to 15% for a maximum period of 150 days, which requires Congressional action to extend afterwards. The law authorizes the president to address a balance of payment deficit or to prevent a significant depreciation in the USD. No formal investigation is needed.
Section 232: Sector tariffs which requires administrative procedures that can take time. No limit on tariff levels or duration.
Section 301: Requires weeks or even months to complete investigations, which is difficult to apply universally. No limit on tariff levels or duration.
Section 338: Allows to impose tariffs up to 50% from countries that discriminate against the U.S. No formal investigation is needed.
Tariffs in Place:
50% global tariffs on steel and aluminum, effective June 4. Previously tariffs were 25% effective March 12.
25% global tariffs on automobile, effective April 3.
25% global tariffs on automobile parts, effective May 3.
3521% tariffs on solar imports from Cambodia, Vietnam, Malaysia and Thailand.
211% tariffs on molded fiber imports from Vietnam.
Tariffs imposed during Trump's first term.
Tariffs Remain in Place But Pending U.S. Jurisdiction:
10% global tariffs, effective April 5.
De minimus packages shipped to the U.S. from China will no longer be exempted from tariffs starting May 2
Individual reciprocal tariffs will be postponed by 90 days except for countries retaliated, effective July 8 (the full list here )
EU:
The 50% U.S. tariffs on EU goods were postponed until July 9
China:
U.S. extended the exclusion of Section 301 tariffs on some Chinese goods until August 31.
The U.S. Commerce Department asked chip design software companies to halt deliveries to China.
The U.S. Commerce Department had suspended some licenses that allowed U.S. jet engine companies to sell products and technology to China.
The U.S. will start revoking Chinese student visas.
The U.S. Commerce Department said it would issue guidance to make clear that using Huawei's Ascend AI chips "anywhere in the world violates US export controls."
The U.S. lowered tariffs on China imports to 30% including 10% universal tariffs and 20% Fentanyl tariffs. Other universal tariffs including 25%?on steel and aluminum and 25% on autos and auto parts have remained in place. Meanwhile, 24% reciprocal tariffs will be suspended for 90 days to allow for further negotiations, with a deadline on August 12.
The U.S.'s weighted average tariff on China imports is lowered to 43.5% from 96%, considering Trump's first term tariffs on China.
Nvidia H20 chips export ban.
From mid-October, Chinese ship-owners and operators will be charged $50 per ton of cargo with the fees increasing each year for the next three years.
Canada: 25% duties on all non-USMCA compliant goods except for energy and energy resources, which are subject to 10% ad valorem duties (about 38% of Canada exports are USMCA compliant). In case of the fentanyl tariffs are removed, non-USMCA compliant goods would be subject to a 12% reciprocal tariff.
Mexico: 25% duties on all non-USMCA compliant goods (about 50% of Mexico exports are USMCA compliant. In case of the fentanyl tariffs are removed, non-USMCA compliant goods would be subject to a 12% reciprocal tariff.
Tariffs Possibly Coming:
Tariffs on electronics including smartphones, computers, laptops, semiconductor devices etc. are temporarily paused. U.S. Commerce Secretary Lutnick said special tariffs on the sector will come soon.
Tariffs on pharmaceuticals may come soon.
Tariffs on copper may come soon.
100% tariffs on movies produced outside of the U.S. may come soon.
25% tariffs on Apple if iPhones are not made in the U.S.
25% on countries that purchase oil from Venezuela.
Retaliations:
China:
China has issued export permits of rare earth to four producers including suppliers to Volkswagen, but the approval process is slow.
China has suspended a ban on exports of dual-use items to 28 U.S. companies for 90 days as part of the trade detente with the U.S.
Starting from May 14, China lowers tariffs on U.S. goods to 10% with another 24% reciprocal tariffs suspended for 90 days.
China has removed the ban on airlines taking delivery of Boeing jets.
On May 2, Bloomberg reports China has exempted tariffs on a list of U.S. products covering 131 items like pharmaceuticals and industrials chemicals, worthing $40 bn or 24% of Chinese imports from the U.S. in 2024 (source ).
Warmed to take reciprocal countermeasures against other countries negotiating with the U.S. if they make a deal at China's expense during the trade war.
Halted on U.S. soybean and corn imports.
Halted imports of U.S. oil (source ).
EU
The EU is planning to impose additional tariffs on EUR95 bn of U.S. exports if trade talks with the U.S. fail to generate a satisfactory result. The breakdown if U.S. goods targeted by EU includes 12.9 bn of chemicals and plastics, 12bn of machinery, 10.4 bn of aircraft, 10.3 of auto parts, 7.2 of electric goods, 6.4bn of agricultural goods and foods and 2bn of motor vehicles (source ).
Postponed its retaliation measures until July 14. The group planned to impose tariffs on EUR21 bn goods with most of the targeted goods face 25% tariffs, and a few categories set to face 10% tariffs. Some of the EU tariffs will take effect in mid-April, while another list will be imposed mid-May and a third will start on December 1.
Penalized Apple for EUR500 mn and Meta for EUR200 mn due to violating antitrust rules.
Considering introducing restrictions on some exports to the U.S. as a possible retaliatory tactic.
Canada
Canada Prime Minister Carney announced a six-month tariff exemption for products used in Canadian manufacturing, processing and food and beverage packaging, and for items related to health care, public safety and national security.
Imposed 25% tariffs on CAD30 bn goods from the U.S., effective March 13.
Imposed 25% tariffs on U.S. cars, which are not compliant with USMCA, effective April 9.
Exempted tariffs on US-assembled automobiles contingent on those automakers continuing to produce vehicles in Canada and on completing planned investments. Automotive News reports that more than 90 percent of vehicles exported from the States to Canada are USMCA compliant. Those vehicles face a 25% tariff on their contents not produced in Canada and Mexico. Finance Canada calculates that the vehicles in question contain 85 percent U.S. content. That math comes out to a 21.25% import tariff on the majority of cars assembled in the U.S. and sold in Canada.
India
On May 13, India proposed to impose retaliatory tariffs on U.S. products in response to the steel and aluminum duties from the U.S., despite two countries signaling to reach a deal soon. India aims to cover an $1.9 bn in duties without specifying which U.S. products will be targeted.
Tariffs Exemptions:
The Trump administration will not enforce the AI diffusion rule when it takes effect on May 15 and instead plans to develop a new rule that would strengthen the control of chips aboard.
On April 29, President Trump signed an executive order to allow automakers to apply for 15% price offsets in the first year of the tariffs and a 10% offset in the second year in a bid to get companies to increase domestic production of automobiles. Also, imported cars will be given a reprieve from separate tariffs on aluminum and steel (detail ).
Reciprocal tariffs exemptions:
USMCA compliant goods.
Steel/aluminum articles and autos/auto parts already subject to 25% tariffs.
Copper, pharmaceuticals, semiconductors, and lumber articles.
All articles that may become subject to future Section 232 tariffs (national security related)
Bullion (gold).
Energy and other certain minerals that are not available in the United States.
. . .
Tyler Durden
Wed, 06/04/2025 - 07:45 Close
Wed, 04 Jun 2025 11:20:00 +0000 Germany Sets Record For Naturalizations In 2024, Syrians And Turks Top The Charts
Germany Sets Record For Naturalizations In 2024, Syrians And Turks Top The Charts
Germany Sets Record For Naturalizations In 2024, Syrians And Turks Top The Charts
Via Remix News,
In Germany in 2024, a record number of foreigners were naturalized, with Syrians and Turks gaining citizenship at the highest rate when all nations are factored.
The data from 13 German states shows that 249,901 people were given German citizenship, which is more than the population of Chemnitz. However, this data does not include all German states, with results from Lower Saxony, Saxony-Anhalt and Schleswig-Holstein still pending.
Syrians were in first place.
For example, in the most populous state, North Rhine-Westphalia, 24,349 Syrians received German citizenship.
Turks came in second place and saw a big jump over 2023.
In North Rhine-Westphalia, the number of Turks gaining German citizenship jumped 83 percent in 2024 compared to the previous year.
Some other outsized growth numbers were seen in other German states. For example, Russians receiving German citizenship jumped 623 percent in the state of Baden-Württemberg.
During the previous government, the rules for citizenship were relaxed substantially in 2024, including the wait time to receive citizenship in some cases. However, according to Welt, this may have not played such a large role in the uptick in naturalizations, as in many states, those seeking citizenship have already been in Germany for many years.
In Baden-Württemberg, the average stay of residence for new citizens was 14.1 years. In some federal states, cases of people receiving accelerated naturalization procedures were not even registered in even a single case.
This citizenship law provision, which critics labeled “turbo naturalizations,” allowed foreigners to receive citizenship after three or four years if they showed outstanding efforts to integrate. However, the new government is seeking to abolish this rule, even if it is not entirely clear if the coalition can work out an agreement.
One aspect of the new law that may have provided an outsized incentive for many long-time German residents to seek out citizenship was relaxation of dual citizenship rules. Previously, new German citizens would have to give up their old passports, but the new law changed this.
Read more here...
Tyler Durden
Wed, 06/04/2025 - 07:20 Close