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Dollar weakens with Fed rate cut; stocks fall along with tech shares
The major stock indexes declined on Friday. Technology shares, including Dell Technologies, led the declines. Meanwhile, the dollar fell against the euro, after U.S. data on inflation kept expectations alive of a September rate cut. Dell fell 8.9% on Thursday after reporting results that included High manufacturing costs for artificial intelligence-optimized servers. In the wider tech selloff, other AI-related stocks fell, including Nvidia down 3.3% and Broadcom down 3.6%. The Nasdaq dropped more than 1%, and the S&P 500 Technology Index fell 1.6%. U.S. Commerce Department announced on Friday that its Personal Consumption Spending Price Index (PCE), which measures the price of consumer goods, rose by 0.2% in July. This compares to a 0.3% rise in June. The increase is in line with estimates from economists polled. PCE inflation increased by 2.6% over the 12-month period ending in July after increasing by 2.6% from June. After removing volatile components such as food and energy, the core PCE Price Index rose 0.3% in July. This followed a 0.3% increase in core inflation for June. You have to enjoy it when everything comes together. Art Hogan of B. Riley Wealth, Boston's chief markets strategist, stated via email that today's figures on personal consumption, spending, income and spending were in the middle. This leaves the Fed's options wide open to reduce rates in September, and possibly again in October and December. The Federal Reserve is now expected to cut rates next month by 89%, up from the 84% odds before the data. After Fed Chairman Jerome Powell's unexpectedly dovish remarks last Friday, traders increased their bets that there would be more cuts. Last, the euro rose 0.11% to $1.1696. The dollar index (which measures the greenback in relation to a basket currencies) fell by 0.09%, reaching 97.79. The Dow Jones Industrial Average dropped 92.02, or 0.20% to 45,544.88, while the S&P 500 declined 41.60, or 0.64% to 6,460.26, and the Nasdaq Composite was down 249.61, or 1.15% to 21,455.55. Zachary Hill of Horizon Investments, Charlotte, North Carolina, said, "Today, there is just weakness at the top of the tech market." This month The S&P 500 increased by 1.9%. The Dow gained 3.2%, and the Nasdaq rose by 1.6%. Labor Day is Monday. Major U.S. Financial Markets will be closed. The British banks weighed on European shares, which closed at their lowest level in two weeks. The data released on Friday showed that French consumer prices increased slightly less than expected in August, while Spain's 12-month inflation rate harmonised with the European Union was unchanged at 2.7%. The MSCI index of global stocks fell by 4.77 points or 0.50% to 951.57. The pan-European STOXX 600 fell by 0.64%. Treasuries Onger-dated yields As traders repositioned themselves for the month end, they closed their positions in anticipation of the long weekend. The yield on the benchmark 10-year U.S. notes increased 1.6 basis points, to 4.223%. The two-year Note The yield fell 1.6 basis points in the last day to 3.619%. This is the largest drop in one year, at 33 basis points. Fed Governor Christopher Waller said on Thursday that he wants to begin cutting interest rates in the next month, and "fully anticipates" further rate cuts. This will bring the Fed’s policy rate to a neutral level. Investors will be eager to see the August U.S. job data, due on Friday. Also, they are waiting for any new information on President Donald Trump's attempts to fire Fed Governor Lisa Cook. Cook has asked a federal judge to set up an expedited briefing program in order to temporarily stop Trump from removing her. She is pursuing a lawsuit claiming that he does not have a valid reason for doing so. Prices of oil were lower. U.S. crude dropped 59 cents and settled at $64.01 per barrel, while Brent fell 50 cents and settled at $68.12. Gold spot rose by 0.88%, to $3.446.75 per ounce.
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Emergency crews finish work following mass Kyiv attack with 25 dead
Rescue crews completed Friday rescue operations following a Russian missile and drone attack on Kyiv in Ukraine's capital. The death toll was revised up to 25, according to authorities. The DSNS State Emergency Service posted photos of the damaged sites in the capital following the attack that occurred on Thursday morning on its Telegram channel. The report said that 22 people, including four children were killed in the apartment building which was destroyed in Darnytskyi's eastern district. The DSNS reported that emergency crews were dispatched at 19 locations in six districts of the city and provided assistance to 312 residents. Volodymyr Zelenskiy, the president of Ukraine, said that the attack, which damaged offices of the European Union (EU) and British Council (British Council), was the second largest since Russia invaded Ukraine on a large scale in February 2022. (Reporting and editing by Ron Popeski)
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Dollar weakens after US inflation data is in line
The major stock indices declined on Friday. Technology shares, including Dell Technologies, led the declines. Meanwhile, the dollar fell against the euro as U.S. inflation figures kept expectations alive of a September rate cut. Dell fell more than 9% following earnings reported late Thursday. High manufacturing Costs for AI-optimized server. In the wider tech selloff, other AI-related stocks also fell, including Nvidia down 3.5% and Broadcom down 4.2%. The Nasdaq fell more than 1%. U.S. Commerce Department announced on Friday that its Personal Consumption Spending Price Index (PCE), which measures the price of consumer goods, rose by 0.2% in July. This compares to a 0.3% rise in June. The increase is in line with estimates from economists polled. PCE inflation increased by 2.6% over the 12-month period ending in July after increasing by 2.6% from June. After removing volatile components such as food and energy, the core PCE Price Index rose 0.3% in July. This followed a 0.3% increase in core inflation for June. You have to enjoy it when everything comes together. Art Hogan of B. Riley Wealth, Boston's chief markets strategist, stated via email that today's figures on personal consumption, spending, income and spending were in the middle. This leaves the Fed's options wide open to reduce rates in September, and possibly again in October and December. Fed funds futures traders now price in 89% of the odds that a reduction will occur next month. This is up from 84% prior to the data. After Fed Chairman Jerome Powell's unexpectedly dovish remarks last Friday, traders increased their bets that there would be more cuts. The euro rose 0.11% to $1.1695. The dollar index, which measures greenbacks against a basket currencies, dropped 0.09% to hit 97.79. The Dow Jones Industrial Average dropped 121.89, or 0.26 %, to 45.516.07. The S&P 500 declined 45.60, or 0.70 %, to 6,456.26. And the Nasdaq Composite was down 267.70, or 1.23 %) to 21,437.45. Labor Day is Monday, and major U.S. financial market will be closed. Investors weighed down British banks as European shares fell to their lowest level in more than two weeks. The MSCI index of global stocks fell by 5.36 points or 0.56% to 950.98. The STOXX 600 Index fell by 0.64%. In Treasuries, benchmark 10-year U.S. Treasury yields were higher on the day, while interest-rate-sensitive two-year yields were on track for their largest monthly drop in a year. The yield on the benchmark 10-year U.S. notes increased by 1.6 basis points, to 4.223%. The yield on 2-year notes fell 1.6 basis point to 3.619%. Germany's 30-year bond yield has increased 12 basis points in the last month. It is now on course to make its largest monthly jump since March when an historic shift towards a looser fiscal policies sent bond yields soaring. Bond yields are inversely related to prices. Fed Governor Christopher Waller said on Thursday that he wants to begin cutting interest rates in the next month, and "fully anticipates" further rate cuts. Prices of oil were lower. U.S. crude oil fell 59 cents, settling at $64.01 per barrel. Brent crude dropped 50 cents, settling at $68.12.
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Holiday schedule for US economic and other data
Labor Day, which falls on September 1, will impact the schedule for the release of major economic, energy, and commodity reports in Washington during the week ending August 31. The schedule is below. The times are in EDT/GMT. Some Treasury announcements may be subject to change. Monday, September 1, Labor Day Holiday Closed federal government offices, Federal Reserve and International Monetary Fund. Stock and bond markets also closed. Tuesday, September 2, Commerce Dept. Commerce Dept. releases Construction Spending for July 1000/1400 Treasury Dept. Treasury Dept. The U.S. Department of Agriculture releases weekly U.S. Export Inspections for Grains, Oilseeds at 1100/1500. Note: this week's inspection is delayed due to the holiday. Treasury Dept. Treasury Dept. Due to the holiday, this sale is delayed. Treasury Dept. Treasury Dept. USDA releases weekly Crop Progress for 1600/2000. NOTE: This is a delayed release from Monday, due to the holiday. Wednesday, September 3 Mortgage Bankers Association releases weekly Mortgage Application Survey, 0700/1100 Redbook releases weekly retail sales index 0855/1255. Note: Tuesday's publication has been delayed due to the holiday. Commerce Dept. Commerce Dept. The Labor Department releases the July Job Openings and Labor Turnover Survey. The Labor Department releases the July Job Openings and Turnover Survey. Treasury Dept. Treasury Dept. Federal Reserve releases the Beige Book, a report on economic conditions. The American Petroleum Institute releases the weekly National Petroleum Report, 1630/2030. Due to the holiday, Tuesday's report has been delayed. Thursday, September 4, Challenger, Grey and Christmas releases U.S. job cut report for August, 730-1130 Labor Dept. Labor Dept. Commerce Dept. Commerce Dept. Energy Information Administration (EIA), Weekly U.S. Underground Natural Gas Stocks, 1030/1430. Schedule is not affected by holidays Treasury Dept. Treasury Dept. Treasury Dept. Treasury Dept. Freddie Mac issues weekly U.S. mortgage rates, 1200/1600 EIA releases weekly petroleum stock and output data at 1200/1600. Note: time change on Wednesday. Federal Reserve releases weekly balance sheet 1630/2030 Friday, September 5, Employment Situation for August, 0830/1230 Labor Dept. USDA releases weekly export sales, 0830/1230. Due to the holiday, this week's export sales are delayed. USDA releases monthly Livestock and Meat International trade data, 1200/1600
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The collapse of an ancient city in Peru is reflected by the Toad sculpture
Archaeologists have confirmed that an ancient civilization has disappeared because of climate change by finding a small sculpture of toads and other water-related symbols near Caral, the once oldest city in the Americas. Climate change is a large-scale, long-term shift in weather patterns. It can be caused by natural factors such as solar activity changes or volcanic eruptions. Human activities have been the main cause of climate change since the early 1800s. Archaeologists found the small sculptures of two amphibians dating back 3,800 year, as well anthropomorphic figures in mud walls, earlier this year, at the Vichama archaeological site, around 160 kilometers north-west of Lima's capital. Site flourished from 1800 to 1500 B.C. It was a major urban center that developed after the fall of the ancient Caral city. According to Tatiana Abad (archeologist and head of research, Vichama), the sculpture depicting the toads represents fertility and the worship of rain and water after prolonged droughts. Abad says that in addition to the 12-centimeter-high sculptures of the two amphibians, skeletal remains from individuals who were malnourished had been found on the Vichama walls. Abad said that the figures suggest that the people are malnourished due to climate change. Climate change is a global phenomenon which has caused the decline of not only Caral but also other civilizations around the world. Abad explained that the toad represents fertility and prosperity and is a symbol for a crisis these populations have endured. Caral is a city of 32 monumental structures dating back about 5,000 years. It shares a common history with other civilisations, such as Egypt and Sumer. Researchers claim that it developed in isolation. Peru is the cradle for ancient cultures. It has many important archaeological remains, such as the Inca Ruins of Machu Picchu or the mysterious giant figures and lines of Nazca. These are located in the desert on the central coast.
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Brazil will launch incentives for data centers next month in order to attract big tech, according to sources
Two economic policy officials have confirmed that Brazil will announce a tax incentive program in early September to attract foreign tech companies to the country to build data centres. Sources who asked to remain anonymous to discuss confidential plans said that the "Redata' program was designed to build goodwill among big tech companies and more generally with the United States which imposed a tariff of 50% on Brazilian goods. U.S. president Donald Trump has linked the tariffs to the case of former Brazilian President Jair Bolsonaro as well as complaints regarding regulation of U.S. technology companies, which includes alleged censorship on social media platforms. Officials from Brazil said that incentives for data centers could help shift the focus of the talks towards mutually beneficial investment. This is in the interest of American companies. Redata reduces capital costs. "Some states in the U.S. are restricting investment in data centers due to energy concerns, but we have surplus power," said one source. It also helps negotiations with America - it is a positive sign. The executive order was originally scheduled for the first six months of the year but it had to be rescheduled amid political turmoil when the government increased a tax on financial transaction. Brazil also dropped its plan to tax large tech companies, for fear that it would escalate trade tensions with the United States. Reports in April stated that data center incentives will exempt technology investments, including PIS and Cofins taxes, IPI duties, and import duties, from federal taxes, if they meet certain criteria, such as 100% renewable power sourcing. Brazil updated rules on "special export processing zones" (ZPEs) in July, which developers are looking to for data center projects. All ZPEs must source their power from yet-to-be-built renewable plants under the new framework. Investors eagerly anticipated the "Redata" Plan, as they saw Brazil's potential to be a hub of data centers that could tap into cheap and abundant renewable energy. Sources previously stated that one such project is planned for the Pecem Port Complex in the northeast. It's a joint venture with energy firm Casa dos Ventos, and ByteDance - the parent company of TikTok. (Reporting and editing by Brad Haynes and Kirby Donovan; Additional reporting in Sao Paulo by Leticia fucuchima;
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Sources say that Petrobras is open to IG4's plan to control Braskem.
Four people with knowledge of the talks said that Petrobras, Brazil's state oil company, was receptive to IG4 Capital's proposal to buy engineering group Novonor outright control over Latin America's biggest petrochemical firm, Braskem. Petrobras is Braskem’s second largest shareholder and has a right to first refusal on Novonor’s stake. This means that its approval will be crucial for the deal. Three other sources, who spoke on the condition of anonymity as well, also said that IG4 has made progress in its discussions with key stakeholders since it signed an exclusive agreement last week to buy billions of reais worth of Novonor bonds from Brazil's biggest banks, including the state development bank BNDES. Sources said that the agreement gave private equity firm IG4 exclusive rights to negotiate with Novonor Petrobras and swap debt for Braskem securities. Three sources have said that the deal could be completed within a few month if the talks continue at their current pace. This would lead to a complete revamp of Braskem’s management. However, they stressed the uncertainty regarding any deadline for negotiations. New controlling shareholders and fresh capital could give Braskem a new lease of life. The company has been struggling with the tight margins of the petrochemical industry and the residual liabilities of the neighborhoods that were damaged by the salt mining operations in the northeastern town of Maceio. According to two sources close to the Presidential Palace, Brazilian President Luiz Inacio Lula da Silva made it clear to his ministers that Braskem is in good health. He also asked Petrobras CEO Magda Chabriard to find a solution which does not compromise Petrobras' interests. The presidential press office didn't immediately respond to our request for comment. IG4, Novonor Petrobras, Braskem and Novonor declined to comment. First reported in November, the Brazilian government and major commercial bank were working on a transfer of Novonor's Braskem share to a private-equity fund. The deal would resolve the debt that hung over Novonor (formerly Odebrecht), which ballooned around a decade ago during the Car Wash scandal, when the group pledged Braskem shares to secure 15 billion reais in bank loans. Since then, the debt has grown to nearly 20 billion reais - more than Braskem's market value. Novonor has been trying to sell its controlling interest in Braskem since years. However, it has repeatedly failed to reach a deal. This includes recent negotiations with Brazilian Nelson Tanure whose exclusive period with Novonor ended last week. Petrobras has confirmed that discussions are taking place with IG4, but one person said that a Tanure deal is not completely ruled out. Petrobras wants to have more control over Braskem management after Novonor relinquishes its control. One source said that Novonor was open to "building" a solution, as long as everyone involved ends up with a win. Novonor could also be interested in retaining a small stake of Braskem as revenue from the company would help it meet its obligations under a judicial recovery plan. Currently, Novonor holds 50.1% and 38.3% respectively of Braskem voting shares. Petrobras holds 47.0% voting shares, and 36.1% total shares.
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Gazprom's first-half net profits down 6% at $12 billion
Gazprom reported that its net income fell almost 6% in the first six months of 2025, to 983.1 billion Russian roubles (12.2 billion dollars), due to the stronger rouble as well as lower oil prices. The revenue also fell to 4,99 trillion roubles. Gazprom suffered a loss in 2023 of about $7 billion, its first since the year 1999. This was due to a drop in sales in Europe. Russian oil has fallen from 30% to around 3% in the same time period. The European Union intends to completely phase out Russian energy in 2027. The company has been trying to increase gas supply to other markets. This includes China. However, efforts to secure an agreement on a new pipe to China have encountered many challenges. Yuri Ushakov, Kremlin's foreign policy aide, said earlier Friday that Gazprom would sign an "important agreement" with Chinese corporation CNPC during President Vladimir Putin’s visit to China next week. Reporting by Ksenia orlova and Oksana kobzeva. Vladimir Soldatkin is the author. (Editing by Louise Heavens, Mark Potter and Mark Potter).
The US Court of appeals rules that most Trump tariffs are illegal
The U.S. Court of Appeals ruled Friday that the majority of Donald Trump's tariffs were illegal. This decision undermines the Republican President's use the tariffs as an important tool for international economic policy.
In his second term as president, Trump has used tariffs to exert political pressure on countries that export goods into the U.S. and to renegotiate deals with trade partners.
Tariffs are a tool that Trump's administration can use to gain concessions from its trading partners, but they also increase volatility on the financial markets.
The U.S. Court of Appeals, Federal Circuit, in Washington, D.C., ruled on the legality of the "reciprocal tariffs" that Trump imposed during his April trade war, as well as a different set of tariffs imposed against China, Canada, and Mexico in February.
The decision of the court does not affect tariffs imposed under other legal authority such as Trump's tariffs against steel and aluminum imports.
It is expected that the case will be appealed before the U.S. Supreme Court.
Trump has justified his tariffs, as well as those more recent ones, under the International Emergency Economic Powers Act. IEEPA allows the president to deal with "unusual or extraordinary" threats in times of national emergency.
Historically, the 1977 law was used to sanction enemies or freeze their assets. Trump, who is the first president to impose tariffs using IEEPA, claims that the measures are justified due to trade imbalances and the flow of drugs across borders.
The law doesn't mention tariffs but it does allow the president to respond to crises in a variety of ways. Trump's Department of Justice argues that emergency provisions in the law allow tariffs. These provisions authorize a President to "regulate or block" imports.
In April, Trump declared an emergency because the U.S. imports far more than they export. This has been the case for decades. Trump claimed that the U.S. trade deficit undermined manufacturing capabilities and military readiness. Trump claimed that the tariffs imposed in February against China, Canada, and Mexico were justified because these countries did not do enough to prevent illegal fentanyl crossing U.S. border. These countries deny this claim.
The court ruled in two cases. One was brought by five small U.S. companies and the second by 12 Democratic U.S. States, who argued that IEEPA doesn't authorize tariffs.
According to the lawsuits, Congress has the power to impose taxes and tariffs and that is not delegated to the president. Any delegation must be explicit and limited.
The U.S. Court of International Trade in New York ruled on Trump's tariff policy on May 28. It said that the president exceeded his authority by imposing both sets of tariffs. A judge appointed by Trump during his first term was part of the three-judge panel.
A court in Washington, D.C., ruled the IEEPA did not authorize Trump's Tariffs. The government appealed this decision. At least eight lawsuits, including one by the State of California, have been filed to challenge Trump's tariff policy. Dietrich Knauth, Dietrich Knauth and William Mallard contributed to the reporting.
(source: Reuters)