US Treasury Secretary Scott Bessent (R) and US Commerce Consultant Jamieson Greer maintain a information convention in Geneva on Might 12, 2025, to offer particulars of “substantial progress” following a two-day closed-door assembly between US and China high officers geared toward ending a devastating tariff battle.
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My high 10 issues to observe Monday, Might 12
1. The US and China agreed to briefly slash their “reciprocal” tariff charges whereas a bigger commerce deal is labored out. The U.S.’s new tariff fee on Chinese language imports will probably be 30%, down from 145%. China’s responsibility fee on American items will probably be 10%, down from 125%.
2. Thawing commerce tensions ought to be finest for corporations that make issues in China and promote them right here within the U.S, resembling lower-level semiconductors, sneakers and Membership identify Apple’s iPhones. Additionally ought to assist out Boeing, which final month had planes returned by China in retaliation.
3. Inventory futures are hovering this morning on the commerce information. The S&P 500 is on observe to open up 3%, whereas the Dow is a roughly 1,100-point pop. The tech-heavy Nasdaq 100 is up probably the most, at 4%.
4. There’s a appreciable brief place in opposition to the market and a common drumbeat of negativity. Final week billionaire investor Paul Tudor Jones mentioned he believes the market would hit new lows even when President Donald Trump reduce China tariffs to 50%. The billionaire class has crushed youthful and retiree buyers as soon as once more.
5. Trump mentioned he is planning to signal an government order at the moment that might reduce drug costs within the U.S. to convey them in keeping with what over high-income nations pay. Nonetheless lots unknown about this, however a fierce authorized combat would seemingly ensue and the drug corporations ought to have the ability to win in courtroom.
6. Trump’s drug pricing threats are why pharma shares are largely sitting out this morning’s rally. Pfizer, AbbVie and Merck are all decrease, as is Membership identify Eli Lilly. On the constructive aspect for Lilly, although, we obtained more complete trial data exhibiting that its weight problems drug Zepbound is superior to Novo Nordisk’s Wegovy.
7. Deutsche Financial institution upgraded Johnson Controls to a purchase ranking from maintain. I like this name, however amongst industrial corporations with information heart publicity, I favor Membership names Eaton and Dover. Eaton had a fantastic first quarter, and Dover is so low-cost.
8. Bernstein downgraded Target to an underperform promote ranking from maintain, with analysts frightened in regards to the upcoming outcomes for its February-to-April quarter because of poor climate and shopper sentiment. However the tariff aid does give Goal a break going ahead.
9. Barclays upped its worth goal on Affirm to $53 a share from $45 and stored its chubby purchase ranking on the inventory. Affirm’s quarter was good, and the lapdog negativists should flip constructive similar to they may with Palantir. You may’t keep brief these names.
10. Barclays additionally boosted its PT on CoreWeave, the newly public AI cloud computing supplier, to $60 from $48. CoreWeave ought to be a rocket, and it reports earnings this week.
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