The president of the Federal Reserve, Jerome Powell is looking forward to giving his speech on the economy later today. And investors to listen to him to gain some insight. The markets are disconcerted not only and not so much by the power of the duties of Trump, as much as by the fact that a US president has started a trade war against allies and adversaries without a clear objective other than, apparently, to extort money or favors, without considering what this might entail for the economies and global balances. And the ones still have to arrive retaliatory measures from other countries. Investors, in the grip of fear and the distrust, abandoned the stock market yesterday in what was the worst day since the outbreak of the pandemic in 2020 and growing fears of a recession global have pushed them to seek refuge in bonds and yen.
La Fitch rating agency warned that the tariffs were a “game changer” for the global economy, with the duties threatening to knock down the overall US economic growth by 2 percentage points this year and to increase inflation of nearly 5%, according to UBS. The tariffs "clearly represent a significant risk to global outlook “in a period of slow growth,” International Monetary Fund Managing Director Kristalina Georgieva said in a press release.
The response of the financial markets to the tariffs was “expected”, Trump said aboard Air Force One, according to reports Bloomberg. Now “let them stabilize. The patient was very sick. The economy had a lot of problems but it had an operation. There will be a boom in the economy and it will be fantastic. There will be trillions of dollars coming in,” The Donald predicted, saying he was however willing to negotiate on tariffs if the countries “offered something phenomenal” and announcing that the tariffs on the sector pharmaceutical and chips will start soon. The Minister of Trade, Howard Lutnick, assured that this time the tycoon "will not back down", while the Secretary of the Treasury, Scott Bessent, warned each country "not to react. Stay calm, let's see how it goes. Because if you react, there will be an escalation".
The afternoon is expected key data on the labor market USA which could already show the condition of the US economy. Fed will be caught between an almost certain rise in consumer prices and the growing risk of recession.
The declines could continue today. After Wall Street's deep decline, there are no signs of a truce in Asia, while the drop in the price of oil. It moves away from its all-time highs their. The dollar is increasingly weak. Wall Street futures are now pointing to a decline of around 0,7%, while European stock futures are down 0,6%.
Wall Street: Darkest Day Since Pandemic. $2,5 Trillion in Value Lost
US stocks yesterday fell to their lowest level since the darkest days of the pandemic, wiping out $2,5 trillion in value following the announcement of Trump's drastic new trade tariffs. The S&P 500 Index fell 4,8%, its biggest drop since June 2020, to once again enter a technical correction after a brutal global rout in markets from Tokyo to London. The Nasdaq 100 index lost 5,4%, its worst day since September 2022, led by Apple's 9% loss. Apple itself is a prime example of this: Its supply chains are deeply entrenched in Asia, where tariffs now range from 24% to 54%. Even if it could shift some of its production to the United States, which is no small ask, the resulting iPhones would cost multiples of what they do now. Apple’s high profit margins show it is better able to absorb some of the tariff impact in the short term than others, but those margins are what justify its skyrocketing stock price.
Rosenblatt Securities Says Apple Needs to Raise iPhone price up 43% to cover the duties. Also Nvidia Corp. and Tesla Inc. both collapsed. Everything from sneaker makers to apparel collapsed after Trump slapped new tariffs on key manufacturing nations including Vietnam and Indonesia. Nike Inc. slipped 14%. Also Lululemon Athletica Inc. , Abercrombie & Fitch Co. and Gap Inc. fell. Automakers General Motors Co. and Ford Motor Co. they both went down.
As analysts have noted, global investors have allocated 70% of their equity capital to U.S. stocks for decades now, well above the economy's 26% share of global GDP. If that preferred status is lost, money could very well flow out. With Trump's trade war now in full swing, investors and analysts are now anxiously awaiting a flurry of upcoming quarterly data that could further shake up the stock market. Analysts have lowered their forecasts for S&P 500 performance in 2025 since the beginning of the year. They expect S&P 500 companies to increase profits by 9,5% this year, down from nearly 13% in early January, according to data compiled by Bloomberg intelligence.
Il dollar records a weekly loss of 2,7% compared to the yen and 3,0% compared to Swiss franc, with the euro up 2,4%.
In Asia, Japan's new collapse. China is closed
There are no signs of a truce in the Asia Pacific equity sell-off. The index Nikkei of the Tokyo Stock Exchange loses 3,5% and revisits the lows of August 2024. The companies most exposed to the export theme are falling. Banks have also been heavily penalized for a couple of days, almost all of them down by about -10% because expectations of significant earnings on loans granted in a context of rising interest rates are disappearing. yen continues to appreciate: the cross against the dollar is at 145,6, an exchange rate not seen in six months. The yield on the 1,15-year government bond of Japan is in free fall, at 1,33%, from 35% yesterday: in the space of two days, the yield has fallen by XNUMX basis points, a movement that happens every ten years, if not more.
The 24% tariffs imposed by Washington on Japanese products constitute a “national crisis” for the archipelago, which relies heavily on its exports to the United States. Japanese Prime Minister Shigeru Ishiba said this during a speech in parliament. An extraordinary meeting between the government and opposition leaders is scheduled for today to discuss responses to US tariffs. Bank of Japan Governor Kazuo Ueda said that uncertainties surrounding the economy have increased, a first step towards a halt, or prolonged suspension, of restrictive monetary policy. Also due to rising prices, Japanese families are cutting back on spending: in February there was a 0,5% drop on an annual basis. Spending on clothing and footwear, housing and food in particular has fallen. Consumer spending accounts for more than half of Japan's economy.
Le China stock exchanges are closedThe S&P ASX2 index fell more than 200% Sidney. Ftse Straits Times by Singapore -2,8%. In the South Korea, President Yoon Suk Yeol was removed from office for “violating” the constitution by declaring martial law in December. The decision paves the way for a new presidential election to be held within 60 days. Opposition leader Lee Jae-myung is the clear favorite. The Kospi stock market index Alone is down 1,7%.
European stock markets seen in moderate decline. At Piazza Affari eyes on Unicredit and Generali
European stock markets are expected to open lower based on the Eurostoxx50 future at -0,34%.
GermanyIndustrial orders in February at zero on a monthly basis after the previous -5,5%, with the forecast of +3,4%.
Stellantis, Fitch cuts the rating to “BBB” from “BBB+”. The outlook is “stable”. The downgrade reflects worsening conditions in the North American core market, as well as rising cost pressures from new tariffs on the automotive sector. Stellantis announced it would temporarily lay off 900 workers at five U.S. plants, as well as temporarily suspend production at assembly plants in Mexico and Canada.
Team. Summit yesterday between the president Alberta Figari and the CEO of Poste Matteo Del Fante on the new governance of the telephone group, writes the Messenger. According to the newspaper, Poste is claiming two seats on the board of directors, including the presidency, for which it has named Annamaria Tarantola. Labriola has been confirmed as CEO, at least in the first phase, while Piergiorgio Peluso would be the CFO, the newspaper adds.
The Italian government is considering raising the threshold for launching a takeover bid to 30%, from 25%, which would allow Poste to reach 29,9% of TIM and pave the way for a consolidation agreement with Iliad Italia.
Unicredit will continue to evaluate in the coming months whether to go ahead with the takeover bid for Banco Bpm, and any decision will not be taken before the end of June. This was stated by a source close to the Piazza Gae Aulenti bank. Interviewed this morning by He would run, the CEO of Generali, Philippe Donnet, said that the collaborations with the bank led by Andrea Orcell could be expanded
Bank Bpm. Today is the last day to join the takeover bid launched by Banco Bpm on Anima Holding. The Piazza Meda institution is just shy of the threshold of two-thirds of the Sgr's capital indicated for the offer to be effective. Over 144 million Anima shares have been contributed to the takeover bid, equal to 56,77% of the shares subject to the offer, and equivalent to 44,3% of the company's total capital.
Ps announced that the rating agency Dbrs Ratings GmbH raised the Long-Term Issuer rating to investment grade from BB (high) to BBB (low), maintaining the positive trend.
Leonardo. Citi has lowered its rating from buy to neutral (the target price however rises from 28,60 to 48,40 euros)
Prysmiam. Citi cut its target price from 69 to 66 euros (buy rating).
GeneraliMorgan Stanley cut the rating from overweight to equal-weight, but raised its target price from 32,6 to 33,8 euros.
Eni has resolved to distribute the fourth tranche of the 2024 dividend of 0,25 euros per share with ex-dividend date on May 19.
FincantieriNorwegian subsidiary Vard has signed a new contract for the design and construction of an offshore diving vessel with Dong Fang Offshore worth €113,5 million, which also includes an option to build additional vessels.
Beghelli. The total compulsory takeover bid promoted by Gewiss on Beghelli ends.
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