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China declares that the'market has spoken after US tariffs spark a sell-off
China said that the market had spoken on Saturday, rejecting President Donald Trump's trade tariffs. It also called for Washington to engage in "equal consultation" following global markets' dramatic response to these levies. On Saturday, several Chinese trade associations from the healthcare and textiles industries to electronics issued statements calling for unity and warning of the impact that tariffs will have on the U.S. inflation rate. Guo Jiakun, a spokesperson for the Chinese Foreign Ministry, said on Facebook Saturday morning that "the market has spoken." He also shared a photo of Friday's fall on U.S. stock markets. Trump imposed additional tariffs of 34% on Chinese goods, as part steep levies that were imposed against most U.S. trading partners. This brings the total duties imposed this year on China to 54%. Trump closed another trade loophole which allowed low-value packages to enter the U.S. tax-free. China retaliated with sweeping measures on Friday. They added 34% to all U.S. products and imposed export restrictions on certain rare earths. This escalated the trade war between two of the largest economies in the world. The global stock markets plunged after China's retaliation, and Trump's comment on Friday that he wouldn't change his course. This extended the sharp losses that had followed Trump's first tariff announcement earlier in this week and marked the largest losses since the pandemic. The S&P 500 fell 9% for the week. Guo wrote, in English: "Now is the right time for the U.S.A. to stop doing wrong things and settle the differences with trading partner through equal footing consultation." China's Chamber of Commerce representing food product traders called on the "China's Food and Agricultural Products Import and Export Industry to Unite and Strengthen Cooperation to Jointly Explore Domestic and Foreign Markets." The Metals and Chemicals Traders' Chamber said that the tariffs would "increase the cost of importation for U.S. consumers and importers, increase domestic inflation, and increase the likelihood of a U.S. recession." (Reporting and editing by Edmund Klamann; Qiaoyi li, Antoni Slodkowski)
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US begins collecting Trump's 10% tariff and shatters global trade norms
Customs agents in the United States began collecting President Donald Trump’s unilateral 10% tariff for all imports of goods from many countries Saturday. Higher levies will be implemented next week on goods imported from 57 major trading partners. At 12:01 am, the initial 10% "baseline tariff" went into effect in U.S. ports of entry, airports, and customs storage facilities. ET (0401 GMT), Trump has now formally rejected the post-World War Two tariff system that was mutually agreed upon. Kelly Ann Shaw, former White House adviser on trade during Trump's initial term and a lawyer at Hogan Lovells, said: "This is by far the biggest trade action in our lifetime." Shaw said at a Brookings Institution conference on Thursday that the tariffs would evolve as countries sought to negotiate lower rates. "But this is massive. She added that this is a significant and seismic shift in how we do business with all countries on the planet. Trump's tariff announcement on Wednesday shook the global stock markets. By Friday, S&P 500 stock value had plummeted by $5 trillion, a record decline in two days. Oil and commodity prices plummeted, while investors fled into the safety of government bond investments. Australia, Britain and Saudi Arabia are among the first countries to be hit by the 10% tariff. U.S. Customs and Border Protection has sent a bulletin to all shippers indicating that there is no grace period on Saturday at midnight for any cargoes in the water. A U.S. Customs and Border Protection Bulletin provided a 51-day period of grace for cargos that were loaded on vessels or planes and transiting to the U.S. prior to 12:01 a.m. ET Saturday. The cargoes must arrive by 12:01 am. ET on May 27, to avoid 10% duty. On Wednesday at the same time, Trump's "reciprocal tariffs" of higher rates of between 11% and 50% will come into effect. Imports from the European Union will face a tariff of 20%, while Chinese products will be subject to a tariff of 34%. This will bring Trump's new tariffs against China up to 54%. Vietnam, which has benefited from Trump's first term trade war against Beijing by shifting U.S. supply chain away from China, will face a 46% tax and agreed to discuss an agreement with Trump on Friday. Canada and Mexico are exempted from Trump's new duties, as they still face a 25% tariff for products that do not meet the U.S. Mexico Canada rules of origin. Trump excludes goods that are subject to separate 25% tariffs on national security, such as steel, aluminum, automobiles, trucks, and auto parts. The list also includes more than 1,000 categories of products that are exempt from tariffs. These include crude oil and petroleum products, as well as other energy imports. They also include pharmaceuticals, uranium and titanium, lumber, semiconductors and copper. The Trump administration is looking into several of these sectors, except for energy. David Lawder reports.
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Equinor’s Activity in Norway Major Driver of Supplier Services Across Country
A new report has found that deliveries within exploration, development projects and operation of Equinor-operated fields and onshore facilities in Norway continued to grow in 2024.Equinor procured goods and services with a total value of $13.85 billion, an increase from $13.02 billion in 2023.Of this, 93% came from Norwegian suppliers located in 260 different municipalities. This resulted in an employment effect of more than 85 thousand full-time equivalents.“The report demonstrates extensive ripple effects and employment effects from Equinor’s activity in Norway. The greatest ripple effects come from operating our fields and onshore facilities, which account for more than 85 billion in deliveries. "With the Norwegian continental shelf (NCS) in a mature phase, high levels of exploration activity and maturing of new oil and gas resources are important to ensure that this continues,” said Kjetil Hove, Equinor’s executive vice president for EPN.The report was prepared by Kunnskapsparken Bodø (KPB) which analyzed actual purchases of goods and services from around 1900 suppliers and several thousand sub-suppliers in nearly 300 sectors.Development projects contributed Norwegian deliveries worth more than $3.47 billion and more than 20 thousand full-time equivalents. The largest share of this comes from subsea developments, which accounted for 31%. Johan Castberg was Equinor’s largest Norwegian field development in 2024, and accounted for 26%. The various electrification projects also created significant ripple effects with 23%.“Looking towards 2035, Equinor plans to continue to ramp up activity. On the NCS alone, we want to see 250 exploration wells, 600 more development wells, 75 subsea developments, 3000 interventions, 2500 modification projects and 50 low-pressure projects. "This robust activity level will require a cost level that yields profitability. Together with its partners and the supplier industry, Equinor must maintain to achieve competitive solutions. If we succeed with this, we’ll be able to maintain value creation on the NCS, as well as preserve high energy deliveries to Europe over the long term,” Hove concludes.Equinor’s exploration activity had deliveries amounting to $1.04 billion, an increase of just over $290 million from 2023.“Equinor’s activity generates work for suppliers all across the country, which demonstrates that this company is important for people and local communities. The competition to secure important contracts and long-term supplier relationships also helps develop competence and innovation throughout the entire supplier industry. "We have lots of small suppliers in the Norwegian supplier industry who are the leading specialists within their respective areas. We must continue to build on our strengths as an energy nation,” said Per Steinar Stamnes of Styrke on behalf of the five trade unions in Equinor; Styrke, SAFE, Lederne, NITO and Tekna.The 2024 analysis also includes operation of renewable energy facilities and low-carbon solutions, where the Norwegian supplier industry delivered services worth 170 million from the operation of Hywind Tampen and the development of Northern Lights.
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Howmet, an aircraft supplier, may stop orders if Trump tariffs are imposed.
According to a letter obtained by, Howmet Aerospace - which supplies parts for aircraft built by Airbus or Boeing - may stop some shipments in the event that tariffs announced by U.S. president Donald Trump are implemented. Howmet, based in Pittsburgh, said that it had declared a force-majeure event. This is a legal term that allows contracting parties to escape their obligations when faced with unavoidable or unpredictable external circumstances. Howmet wrote that it would be excused from providing any products or services impacted by the declared national emergency, and/or tariff executive order. Howmet refused to comment. Howmet supplies critical metal components to the $150 billion jetliner market. Boeing and Airbus have not responded to requests for comment regarding the letter. Three industry sources claim that the letter was sent to multiple companies in the aerospace sector. One source said that this was the first time a major aerospace firm had made a move like this since the announcement of tariffs. Howmet's rare declaration of legal intent does not automatically mean that the supply will be stopped or disrupted, but it opens the door for the supplier to claim they cannot meet their contracts if affected by the emergency order. The letter said that Howmet was willing to work with its customers, "including your interest in reducing the impact of the Tariff Executive Order for Howmet". Three industry sources have said that a successful declaration of force majeure would ripple throughout the supply chain, as companies try to shift the burden. This is just the latest twist in an already hard-hit supply chain for aerospace products. Some companies are now facing higher costs as a result of U.S. duties on imported steel and aluminum, along with new duties that will be imposed by other countries. Trump announced tariffs ranging between 10% and around 50% on Wednesday. This escalated a dispute which has rattled investors, and fueled fears of an upcoming recession. Two sources say that aerospace companies usually contest such maneuvers. They also add that the success or failure of Howmet’s move will depend on how unpredictable the tariffs are, especially since Trump mentioned them during his election campaign. (Reporting from Allison Lampert, in Montreal, and Tim Hepher, in Paris; editing by Joe Brock and Matthew Lewis.)
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Wall St Week ahead-Shell-shocked Markets brace themselves for more tariff turmoil
After the worst week in U.S. stock markets since the start of the coronavirus epidemic five years ago, investors are on edge about the potential fallout of President Donald Trump's import levies. Investors are looking for signs that the stock market is nearing a bottom, at least in the short term. Trump's tariffs have shook global asset prices. The S&P 500 index registered its largest weekly decline since March 2020, while the Nasdaq Composite ended Friday down over 20% from its record high in December. This confirms that the tech-heavy index is currently in a bearish market. The Dow Jones Industrial Average ended the week well below its record high from December, indicating a correction. After Trump's Wednesday announcement, the markets were in a tailspin and fears of a recession were raised. Jeffrey Palma is the head of multi-asset solution at Cohen & Steers. There are many questions regarding tariffs and retaliatory duties, as well as where the situation ends. The S&P 500 closed the week down by over 17% compared to its all-time high of February 19. According to LSEG, in the two days after Trump's announcement of tariffs, S&P companies lost $5 trillion in value. This is the biggest amount in two days. Matthew Miskin is co-chief investment analyst at John Hancock Investment Management. This kind of decline... could lead to a weakening in economic activity. Trump's tariffs will be the most significant trade barriers for more than a hundred years. They include a baseline 10% tariff on all imports, and targeted higher duties on dozens countries. China responded with 34% additional tariffs on U.S. products on Friday, intensifying the trade war. Investors have downgraded economic and earnings predictions, with JPMorgan analysts increasing the risk of global recession to 60% this year from 40% previously. Investors hoped that Trump would make deals with certain countries in the coming days to reduce tariffs. Some investors were skeptical that Trump would make any concessions. Citi strategist Scott Chronert wrote in a Friday note that despite Trump's chance to pivot, the "window is closing and some damage may have already been done to consumer and business trust regardless of what the final negotiated point is," One sign that the future is bleak: The Cboe Volatility Index (an options-based measure for investor anxiety) has reached its highest level since April 2020. The American Association of Individual Investors' survey showed a bearish mood at 61.9%. This is the highest level since 2009. Investors are cautious of gloomy financial forecasts, as tariffs have clouded the outlook. U.S. firms will begin reporting their quarterly results in the next week. According to LSEG IBES, S&P earnings should have risen 7.8% from the previous period in the first quarter. Major banks JPMorgan & Wells Fargo are due to report on April 11, 2019. In a note published on Friday, RBC Capital Markets analysts cut their earnings forecasts for 2025. Keith Lerner is co-chief investment officers at Truist Advisory Services. He said that the market's decline and growing pessimism may mean that news stories are less likely to be able to boost stocks. Lerner explained that "if you had something even remotely positive at this time, you might see a spark in the short term because people are braced to face a negative outcome." The consumer price index report for the month of March, due out on Thursday, could also help establish a baseline in terms of inflation in the United States, before the tariffs are implemented, which will likely increase the pressure on prices. According to LSEG, investors have factored in further Federal Reserve interest rates cuts this year as a result of the announcement of tariffs. Fed fund futures account for 100 basis point of easing in this year. Fed Chair Jerome Powell stated on Friday that tariffs were "larger than anticipated" and that the economic fallout will likely be the same, with higher inflation and slower GDP. Palma of Cohen & Steers said that it is important for the markets to be stable in the next few days. Palma stated that "we've had a couple of really, really big market days." What we don't want is for this to start a vicious cycle which destabilizes our financial system. Reporting by Lewis Krauskopf; additional reporting in San Francisco by Noel Randewich; editing by David Gregorio
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Hedge funds and ETFs sell over $40 billion worth of stocks in response to Trump tariff shock
Hedge funds and leveraged exchange traded funds (ETFs), which are increasingly bearish following President Trump's election, dumped over $40 billion in stocks at an accelerated pace. Donald Trump shock announcement of harsher-than-expected global tariffs, according to bank notes to clients on Friday. S&P 500 companies are reporting a rise in profits since late Wednesday night, when Trump raised tariff barriers to the highest level seen in over a century. Stock market values dropped by over $4 trillion JPMorgan stated in a report that portfolios targeting volatility had between $25 billion to $30 billion of equities they would be selling in the next few days as they unwind their positions to reduce risks. JPMorgan reported that Levered ETFs needed to sell an additional $23billion to rebalance their portfolios before today's close. This was mainly tech stocks. The bank said that macro systematic strategies sold stocks on Thursday at levels higher than expected, and a resurgence of the meltdown on Friday will force them to sell even more. The sell-off was also driven by other strategies. Goldman Sachs said in a separate note that hedge funds who are long or short equities around the world experienced the biggest selling on a global basis on Thursday. They also became the most bearish ever since 2011. Goldman Sachs, JPMorgan and other firms that provide trading and leverage to hedge funds track industry trends by using their clients. JPMorgan said that it also uses some estimates. Goldman has not provided the dollar amount of net sales and has not responded to an immediate request for comments. In a note, the bank stated that portfolio managers added bets primarily against stocks and credit exchange-traded fund on Thursday. They also ditched their long positions after Trump announced new import tariffs which sparked concerns about a recession. The U.S. led hedge fund sales with the financial shares net-sold in the fastest rate since 2016. The bank said that the only sectors where investors purchased on a net-basis were real estate, staples, and utilities. These are the three industries which have a tendency to do well in recessionary conditions. Long/short hedge fund portfolios with more bearish positions outperformed the benchmark S&P 500 Index, which has lost 13.7% year-to date through Friday morning. Goldman said that leverage levels within the hedge fund sector remain near a year-high. (Reporting and editing by Megan Davies and Franklin Paul in New York. Editing by Richard Chang, Diane Craft, and Diane Craft.)
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Oil prices drop as China retaliates against Trump tariffs
Oil prices and global stock markets fell again on Friday, as China retaliated against U.S. president Donald Trump's new tariffs. Worries about a long-term trade war increased. The Nasdaq composite was heading toward a bear-market, and the pan-European STOXX 600 confirmed that it was in correction mode as the trade conflict fanned concerns about a global recession. S&P 500 Companies have lost more than $4 trillion since Trump announced his tariffs on late Wednesday. This is a record-breaking two-day drop for the benchmark. It surpasses a two day loss of $3.3 trillion that occurred in March 2020 when the pandemic ravaged global markets. While the dollar recovered on Thursday, some investors turned to government bonds for safety. China responded to Trump's new tariffs by imposing additional 34% levies on American goods on Friday, which confirmed investor fears of a global trade war. Trump imposed a tariff of 10% on the majority of U.S. imports, and much higher rates on dozens more countries. This is the highest trade barrier in over 100 years. Rick Meckler is a partner at Cherry Lane Investments in New Vernon, New Jersey, a family-owned investment firm. "For investors who thought it was just a simple negotiation, while this may still be true to some extent, it is getting incredibly deeper and more dangerous for businesses." The fact that the U.S. economy created far more jobs in March than was expected did not brighten the mood. Jerome Powell, Federal Reserve Chair, said at a Business Journalists' Conference in Arlington, Virginia that Trump's tariffs were "larger than anticipated" and that the economic fallout would be similar, with higher inflation and slower GDP. He said that the U.S. Central Bank does not predict a decline in its outlook, but acknowledged private sector forecasters are changing their views on this front. Peter Cardillo is the chief market economist of Spartan Capital Securities, a New York-based brokerage. Companies that have exposure to China fell as well. Apple, Nvidia, and Amazon.com all fell sharply. Globally, bank shares fell as concerns about a recession grew. S&P 500 Financial Index was down 6.8% while Energy was down over 8% due to falling oil prices. The Dow Jones Industrial Average dropped 1,953.69, or 4.78% to 38,601.34, while the S&P 500 fell 288.97, or 5.35% to 5,107.55, and the Nasdaq Composite declined 871.79, or 5.25% to 15,678.81. The MSCI index of global stocks dropped by 41.22 points or 5.1% to 766.4. The pan-European STOXX closed 5.1% lower. This was its largest daily loss since COVID-19-driven selloffs in 2020. The index dropped nearly 12% since its all-time March 3 closing high, which confirmed it was in correction. Japan's Nikkei 225 fell 2.8% overnight for a second session running. Brent crude futures dropped 6.5% and settled at $65.58. U.S. Crude Futures fell 7.4% and settled at $61.99, their lowest level since April 2021. Powell's cautious tone about future easing helped the dollar recover against the yen and euro. The dollar index rose 0.9% last after Thursday's biggest drop since November 2022. The euro fell 0.81% to $1.096. The dollar gained 0.58% against the Japanese yen to reach 146.9. Investors are unsure where to invest their money after years of massive flows into U.S. stock markets and an booming American economy. This helped to drive a strong rush towards the government bond markets. The yield of the 10-year Treasury bill, which is considered to be the benchmark in the U.S., fell by 12.2 basis points from 3.86% to 3.933%. Prices and yields are inversely related. The benchmark yield for the Eurozone, which is the German 10-year bond, dropped as much as 17 basis points during the day. Money market futures are pricing in a Fed rate cut of 110 basis points by the end this year. This is compared to 75 bps about a week ago. The traders also increased their bets for Bank of England and European Central Bank decreases. Meckler stated that "a lot of investors who I have spoken to said, in this type of environment, we should just go cash and wait,"
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Canada's response to US tariffs
Mark Carney, the Canadian Prime Minister, announced on Thursday limited countermeasures to U.S. auto-tariffs. He imposed a 25% tax on vehicles imported from America that do not comply with the U.S. Mexico-Canada Trade Agreement. Carney, the man who succeeded Justin Trudeau last month as Prime Minister, stated that new tariffs will not affect auto parts or vehicle content coming from Mexico. He said that the Canadian tariffs, which are estimated at C$8 billion, before a remission procedure for tariff relief, would go directly to affected auto workers. Donald Trump, the president of the United States, imposed 25% tariffs in March on goods that were not compliant with USMCA. On March 11, he imposed tariffs for steel and aluminum imports. A 25% import tax was implemented on Thursday. Trump spared Canada global tariffs. Here are the retaliatory actions that Canada has taken. First, Trudeau responded to Trump's initial tariffs by imposing 25% tariffs on C$30 Billion ($21.10 Billion) of goods imported from the U.S. annually on 6 March. The C$30 billion is part of a broader retaliation strategy that targets C$155 billion of imports from the U.S. The first batch of retaliation includes 1256 products, including orange juice, peanutbutter, wine, spirits and beer, coffee and other beverages, as well as apparel, footwear and motorcycles. The value of imported products is C$3.5 billion for cosmetics and body products, C$3.4 billion for appliances and household goods, C$3 billion for pulp and paper, and C$1.8 billion in plastics. AUTOS IN ALUMINUM AND STEEL On March 13, Canada increased its tariffs by 25% on additional products worth C$29,8 billion imported from the U.S. The tariffs are expected to stay in place until U.S. steel and aluminum tariffs against Canada are eliminated. Tariffs on steel and aluminum include a variety of products, including candles, glues and umbrellas, as well as kitchenware, gold and platinum jewelry, and other items. Prime Minister's Office announced on April 3 that the new auto tariffs would apply to imports of cars worth C$35,6 billion. Tariffs of 25% will be imposed on vehicles that are not USMCA compliant and on vehicles with non-Canadian or non-Mexican components. Non-tariff Measures Trudeau said Canada was also considering non-tariff measures that could be related to vital minerals, energy procurement, and other partnerships. Carney responded on March 25, when asked if nontariff measures like export taxes or controls were on the table. Canadian provinces have removed U.S. alcohol from store shelves, and Ontario Premier Doug Ford has said that all U.S. companies will not be allowed to participate in government procurement. Ontario has canceled its C$100 million contract with Trump's ally Elon Musk and Starlink. Canada has frozen Musk's Tesla rebate payments and barred the electric vehicle maker from participating in future EV rebates. Toronto has stopped offering financial incentives to Tesla owners who purchase vehicles as taxis or ride-sharing services due to trade tensions with U.S. The PMO announced on April 3 that Canada will also develop a framework to encourage auto production and investment.
Iron ore prices rise as China's demand for the metal outweighs US trade tariffs
Iron ore futures rose on Monday, as the demand for this key ingredient in steelmaking from China's top consumer outweighed U.S. trade tariff worries.
As of 0255 GMT, the most traded May iron ore contract at China's Dalian Commodity Exchange rose 1.97% to $776 yuan (US$106.90) per metric ton.
The benchmark April Iron Ore traded on the Singapore Exchange rose 1.49%, to $101.4 per ton.
Mysteel, a consultancy, said that production among China's independent EAF steel producers has increased this week due to the continued recovery of domestic demand.
Mysteel data showed that the average capacity utilization rate of EAF mills increased for a sixth consecutive week to 54.9% on Friday, its highest level since June 2024.
Broker Galaxy Futures reported that hot metal production, which is typically used to gauge demand for iron ore, has increased month-on-month while the demand for manufacturing steel remained high.
SteelHome's weekly data shows that portside iron ore stocks decreased by 0.1%, to 138.5 millions tons on March 21.
At a Beijing business forum on Sunday, Chinese Premier Li Qiang urged other countries to open up their markets in order to combat the "increased instability and uncertainty" as China prepares for more U.S. Tariffs.
Qian Gang of CITIC Special Steel was quoted on Friday as saying that Beijing is considering setting up funds to create a compensation system for eliminating outdated steel capacity.
China announced at its annual parliamentary session earlier this month that it would restructure the giant steel industry by cutting output, but didn't announce any specific targets.
Coking coal and coke both increased in price, adding 0.69% to the DCE.
The Shanghai Futures Exchange saw a rise in most steel benchmarks. Rebar gained 1.07%; hot-rolled coils added 1.4%; wire rod gained almost 0.8%. Stainless steel dropped 0.22%. $1 = 7.2591 Chinese Yuan (Reporting and editing by Sumana Nady).
(source: Reuters)