US vs. Europe Trade War, Capital Flight, Company Stock News and Geopolitics
Latest stock market news
• Donald Trump and European markets have come full circle again. The euro and European stocks fell on Friday when the US president suddenly decided to impose 50 per cent tariffs on imports from the European Union as trade talks were not moving fast enough. By Sunday, Trump had delayed the tariffs again after European Commission President Ursula von der Leyen asked for time, and markets were up again this morning. The euro hit its highest level against the dollar since April 30.
Von der Leyen wrote in a message on X on Sunday that she had a "good" phone conversation with Trump.
• Markets may have recovered, but sentiment has not. The weekend's swings only reminded investors how chaotic, impulsive and unpredictable Trump can be, even when dealing with his biggest trading partners. Germany was the EU's biggest exporter to the US last year.
In early April, Trump set a 90-day window for trade talks between the EU and the US, which was set to end on July 9. Trump’s latest trade tantrum came just hours after European Central Bank policymaker Joachim Nagel, who heads Germany’s Bundesbank, said markets were close to a nuclear crisis after Trump’s April 2 tariff announcements helped discipline the US administration. Apparently not.
• Investors continue to slowly emerge from the chaos and their overinvestment in the world's largest economy and stock markets. European equity funds attracted €34 billion ($38.6 billion) in cash in the year ended May 16, four times the €8.2 billion poured into U.S. equity funds, according to Morningstar.
By comparison, in 2024, net flows into US equity funds in Europe outnumbered local market-focused products by more than 8:1.
• Due to holidays in the US and UK markets, trading should be relatively quiet on Monday. On the data front, it is also relatively quiet, with important data due this week, including the Fed's inflation target, consumer spending for April, due on May 30. This could paint a clearer picture of the impact of US tariffs.
April has been a volatile month in markets following Trump's tariffs on April 2, but the latest consumer and producer price data have yet to show any signs of inflation.
• The eurozone's largest economies, France and Germany, release consumer price data on Tuesday and Friday, with pan-European data released the following week.
• SoftBank founder proposes creating US-Japan investment fund/ The fund will be aimed at large-scale investments in technology and infrastructure projects. It is assumed that the initial capital of the fund could be about $300 billion. The fund will open up opportunities for participation by institutional and private investors from Japan and the USA.
• The widening gap between US bond yields and the USD/JPY rate is a key signal of rising fiscal risks in the US, - Deutsche Bank.
The strength of the yen amid rising Japanese bond yields does not indicate concerns about Japan's finances, but rather a decline in Japanese investors' appetite for treasuries.
• Oracle to invest $40 billion in Nvidia chips for OpenAI data center in the US, - Reuters.
• Rothschild bank found guilty of money laundering.
The Seventh Criminal Chamber of the Luxembourg District Court found the Edmond de Rothschild Bank (Europe) guilty of money laundering and concealment of criminal proceeds and ordered the confiscation of €25 million previously seized as part of the investigation.
• European authorities are expanding their antitrust investigation into Visa and Mastercard,
with the European Commission's antitrust division this week sending questionnaires to payment terminal providers and fintech companies to find out whether the two largest operators are abusing their market power.
• While BTC ETFs saw record inflows last week, gold ETFs saw $2.9 billion flow out — the largest outflow in more than a decade and the third-largest in history.
More than $4 billion in short positions on Bitcoin are at risk of liquidation if BTC hits $120,000.
• Pakistan to set aside 2,000 MW of power for bitcoin mining, Bloomberg reported.
The initiative will help monetize excess energy and create high-tech jobs, the finance ministry said in a statement.
• The dollar index is showing signs of ending a decade of appreciation and approaching the start of a bear cycle, given historical dynamics, - Otavio Costa.
• OnlyFans has become the absolute leader in revenue per employee, surpassing even such giants as Apple and Nvidia.
The platform has demonstrated impressive efficiency: each of its employees “brings” $37.6 million in revenue to the company.
• Tesla (TSLA) is moving away from autos to bet on autonomy because China has already won the electric car battle, Morgan Stanley.
• Nippon Steel Finally Gets Control of US Steel?
Trump has conditionally given Japan's Nippon Steel control over US Steel, calling the deal a "partnership."
The deal would involve $14 billion in investment and create 70,000 jobs.
While final terms have yet to be finalized, US Steel shares have already soared 21%.
• Nvidia (NVDA) will begin mass production of its new Blackwell chip for China as early as June.
Informatica (INFA) rose more than 25% on Friday amid speculation it could be acquired by Salesforce (CRM).
• Salesforce shares, on the other hand, fell 3% as investors worried about the potential financial risks of the deal.
• Douglas Elliman (DOUG) soared 33% on Friday on news of a buyout offer from Anywhere Real Estate (HOUS).
The offer values the company at more than $4 a share, but the current price is likely to be rejected.
• Gilead (GILD) said its drug Trodelvy met its primary Phase 3 goal for first-line treatment of TNBC,
which could significantly increase the drug's market.
• Palantir (PLTR) received a $795 million modification to its contract with the U.S. Army.
Wedbush believes this strengthens the company's position in the AI sector of government contracts.
• Merus (MRUS) gained 16% on Friday
after positive data from its head/neck cancer drug, which saw a 63% response rate in patients in a mid-phase study.
• Vermilion Energy (VET) sold assets in Canada for 415 million CAD.
The money will be used to reduce debt. The company's focus is long-term income-generating assets.
• Wix (WIX) acquired startup Hour One to boost AI features in web design.
The market reaction was muted, with shares down slightly.
• Wolfspeed (WOLF) has appointed David Emerson as Chief Operating Officer,
a decision that comes amid financial challenges and a business restructuring.
Key events that could impact markets on Monday:
- SPEAKERS: ECB President Christine Lagarde, Riksbank board meeting
- COMPANIES: NTS Ackermans & Van Haaren NV AGM, Leonardo SpA AGM
- DEBT AUCTIONS: Resumption of auctions for 3-month, 6-month and 1-year French government bonds.
Current Fundamental Reviews
• Trump delays 50% tariff on EU goods from June 1 to July 9.
"I received a call today from Ursula von der Leyen, the president of the European Commission, asking for an extension of the 50% tariff on trade and the European Union until June 1. I agreed to an extension - until July 9, 2025 - and was honored to do so. The commission president said negotiations would begin quickly."
• In May, the Trump administration lost 96% of cases in court, says Stanford University professor Adam Bonica.
As analysts at the information resource Data for Democracy note, the percentage of losses for Trump and his supporters in court is rapidly growing. At the same time, the ideological difference between judges plays an increasingly smaller role in decision-making.
• Two candidates – two marches: Poles took to the streets of Warsaw ahead of the second round of the presidential elections.
Tens of thousands of people marched to support their candidates. The mayor of the Polish capital, Rafal Trzaskowski, and historian Karol Nawrocki are vying for victory in the election race.
• Mexico has carried out judicial reform, and now some judges will be elected in direct elections by citizens - Reuters.
The list of candidates includes about 20 controversial figures: from convicted drug traffickers to officials fired for corruption and lawyers for the largest cartels.
• Musk has decided to leave politics due to security concerns, as well as difficulties in achieving results and the negative reaction to his activities, - The Washington Post.
Now he intends to focus more on leading Tesla and SpaceX.
• Gerhard Schroeder's account where he received money from the Russian Federation has been blocked - Bild. Sparkasse Bank no longer credits transfers to the former German Chancellor's account.
• The US criticized the proposal as insufficient, while Trump called it worse than proposals from other countries. In response, the EU prepared duties on $23.9 billion of US goods, as well as an additional list of duties worth $95 billion in the event of escalation, in particular on Boeing products, American cars, bourbon and other industrial goods.
Trump's threat to introduce a 50% tariff on all EU goods would be a crushing blow to key sectors of the European economy: the automotive industry, aerospace, chemicals and food industries - FT
According to the European Commission, the US is the EU's largest trading partner.
The US market accounted for just over 20% of EU goods exports in 2024, which are estimated at more than €530 billion.
Trump is seeking new tariffs on imports from China from the EU as a condition for concluding a trade agreement with Washington - WSJ.
• Trump confirms there will be a "massive" parade in Washington on his birthday.
He said there will be a "massive" parade in Washington on June 14, his birthday.
• Boris Pistorius confirmed the indispensability of the US nuclear umbrella for Europe, — Frankfurter Allgemeine Zeitung.
Spain remains the only country that has not yet supported NATO's plans for defense spending of 5% of GDP
, the figure demanded by US President Donald Trump — Financial Times.
• Economists surveyed by Bloomberg expect Canada to enter a technical recession this year,
with GDP forecast to decline by 1% and 0.1% in Q2 and Q3, respectively. The economy is then expected to recover through the end of the year.
At the same time, inflation is forecast to remain above the central bank's target: 2.1% in Q3 and 2.2% in Q4.
• Trump intends to invoke the Cold War-era Defense Production Act
to declare a national emergency over U.S. reliance on Russia and China for enriched uranium, nuclear fuel reprocessing and components for advanced reactors — Reuters.
• Blackout in the French department of Alpes-Maritimes: there was no power and no internet.
Traffic lights went out, film screenings at the Cannes festival were partially stopped, local media write. Screenings were only resumed thanks to a generator. About 1,600 houses in Cannes and neighboring towns were left without power.
• The US has eased sanctions on Syria after Trump's promise - Reuters.
The US Treasury Department has issued a license that allows transactions involving the interim government, the Central Bank and state-owned enterprises.
• $1,000 in a “Trump Account” for Babies.
Republicans propose opening a $1,000 investment account for every newborn in the US – the so-called “Trump Account.”
In theory, the money would be invested in US indices and would only be available to children after age 18.