Steel Tariffs Set to Double Starting on Wednesday
4 minutes ago
President Donald Trump’s newly increased tariffs on metals may benefit the steel and aluminum sectors but can negatively impact the broader economy. Beginning Wednesday, importers of steel and aluminum are required to pay a 50% tariff, an increase from the prior 25%. This new trade policy was announced by Trump last week, further escalating metal tariffs originally instituted in March. Analysts predict that while these increased tariffs may bolster the U.S. steel and aluminum industries, they could adversely affect consumers and manufacturers reliant on metal.
Economists have a relevant case from 2018 when Trump raised tariffs on steel to 25% and aluminum to 10%, later providing exemptions for Canada and Mexico. Research from Columbia revealed that the tariffs spurred U.S. steel and aluminum production and created approximately 1,000 jobs.
However, the surge in metal prices also harmed many other manufacturers by raising the costs of raw materials for various products, including engines and beverage cans. Additionally, retaliatory tariffs from other nations impacted U.S. exporters; by 2019, the entire U.S. manufacturing sector saw a decline of 75,000 jobs compared to a scenario without the tariffs.
The upcoming tariffs are expected to yield similar consequences, according to trade expert Gary Clyde Hufbauer from Georgetown University. He stated, “With the 50% tariff, American steel will be less competitive internationally, affecting numerous industries that rely on steel.” Furthermore, this sudden increase in tariffs introduces yet another uncertainties in Trump’s unpredictable trade wars and raises the possibility of hikes in other existing tariffs.
Sal Gautieri, a senior economist at BMO Capital Markets, commented, “This will slightly elevate the average U.S. tariff rate to around 15%,” and expressed concern that it could set a precedent for higher tariffs on vehicles and specific product sectors.
Following Trump’s announcement late Friday to double the tariffs, stock prices of steel producers surged. Cleveland-Cliffs increased by 4% and Steel Dynamics and Nucor rose slightly after substantial gains on Monday.
Kenvue Slides as CEO Points to Demand Challenges
1 hr 9 min ago
Kenvue shares led declines in the S&P 500 on Tuesday as CEO Thibaut Mongon indicated the company faces challenges due to seasonal demand for its allergy products. Speaking at Deutsche Bank’s Global Consumer Conference, he noted that a prolonged winter delayed the start of the allergy season, resulting in lower demand compared to last year.
Mongon also mentioned similar issues for sun protection brands like Neutrogena, acknowledging that the season has not yet picked up as expected. Kenvue shares fell over 6%, but still show a year-to-date growth of roughly 4%.
Joby Aviation Stock Soars on Deal to Explore Saudi Launch
2 hr 43 min ago
Shares of Joby Aviation climbed Tuesday after the electric air taxi company announced a partnership with Saudi Arabian investment firm Abdul Latif Jameel. This memorandum aims to explore establishing a distribution agreement in Saudi Arabia for Joby’s electric aircraft, targeting the potential delivery of 200 aircraft valued at approximately $1 billion in the coming years.
Joby remains on track to begin operations in Dubai by 2026, with previous investments from Abdul Latif Jameel supporting its initiatives.
Jefferies Adds Nvidia to ‘Franchise Picks’
3 hr 52 min ago
Jefferies has incorporated Nvidia into its “Franchise Picks,” a selection of highly rated stocks. Nvidia’s role as the main provider of AI accelerators for data centers was cited as the motivation behind this decision. Following Nvidia’s quarterly results, the firm was impressed by revenue predictions, despite a significant anticipated $8 billion revenue loss due to U.S. export restrictions.
Nvidia is poised to benefit from increased AI commitments from Middle Eastern nations, further bolstering its revenue outlook.
Constellation Energy Surges on Deal With Meta to Power AI
5 hr 22 min ago
In early trading, Constellation Energy shares rose significantly after announcing a 20-year agreement to provide nuclear power to Meta Platforms, enabling advancements in AI hub operations. This collaboration supports sustaining Constellation’s Clinton nuclear plant operations into 2027, amid a growing trend of tech companies seeking nuclear energy as a reliable power source for their data centers.
As companies like Meta join others in investing in nuclear power, the sector experiences a renewed boost.
Dollar General Jumps on Strong Results, Raised Outlook
6 hr 8 min ago
Dollar General shares surged early Tuesday following stronger-than-expected quarterly results and an updated forecast for the fiscal year. The retailer posted earnings of $1.78 per share, exceeding projections, and raised its full-year earnings outlook. However, concerns regarding potential tariff impacts on consumer behavior were raised, leading to a cautious approach in their outlook amid positive market trends.
Major Stock Index Futures Slightly Lower
7 hours ago
Futures for the Dow Jones Industrial Average are down by 0.2%, while S&P 500 futures decreased by 0.1%. Nasdaq 100 futures also saw a minor dip, indicating a cautious market sentiment.
