- Asian Stocks Fall on Tariff Woes, Gold Hits Record: Markets Wrap
Asian shares dropped Friday as concerns about the upcoming ‘reciprocal tariffs and a widening trade war
weighed on investors’ appetite for risk. Gold hit a new record on demand for safe havens.
A regional gauge of equities fell 1% after declines in Japan, Hong Kong and South Korea. Taiwan’s stock index
touched the lowest level since September as technology companies weighed. Japanese shares dropped also
because Friday is the ex-dividend date for most companies in the fiscal year-end. Yields on the 10-year US
Treasury fell slightly while equity-index futures for US stocks were mixed. - Dow posts back-to-back losses Thursday as Trump’s auto tariffs weigh on stocks
Stocks fell on Thursday as investors weighed the latest tariff-related news from President Donald Trump,
including his new tariffs aimed at foreign automakers. The Dow Jones Industrial Average dropped 155.09
points, or 0.37%, to end at 42,299.70. The S&P 500 declined 0.33% to close at 5,693.31, and the Nasdaq
Composite slid 0.53% to settle at 17,804.03. The Dow Jones Industrial Average dropped 0.4%. The Cboe VIX
Index hovered near 19. Dow Jones Industrial Average futures fell 8 points, 0.02%. S&P 500
futures and Nasdaq 100 futures slipped 0.05% and 0.1%, respectively. - Oil approaches one-month highs as investors assess supply, trade war risks
Oil prices edged higher on Thursday as traders assessed a tightening of crude supplies along with new U.S.
tariffs and their expected effect on the world’s economy. Brent crude futures gained 24 cents, or 0.3%, to
settle at $74.03 a barrel. U.S. West Texas Intermediate crude futures rose 27 cents to $69.92. On Wednesday,
oil prices rose about 1% to their highest since February. Market participants were weighing escalating trade
war risks. U.S. President Donald Trump unveiled his plan on Wednesday to implement 25% tariffs on
imported cars and light trucks effective next week, while those on auto parts begin on May 3. Trump on
Tuesday imposed new 25% tariffs on potential buyers of Venezuelan crude. Data on U.S. crude
inventories on Wednesday showed tighter U.S. supplies, as stockpiles fell by 3.3 million barrels last week
versus expectations for a 956,000-barrel draw. - Gold hits record high as U.S. tariffs spark trade tensions
Gold scaled a record peak on Thursday, as investors sought the safe-haven asset in response to escalating
global trade tensions and tumbling equity markets, following U.S. President Donald Trump’s announcement
of new auto tariffs. Spot gold climbed 1.1% to $3,052.24 an ounce after hitting an all-time high of $3059.30.
Bullion has hit 17 record highs this year. U.S. gold futures climbed 1.5% to $3,066.6, also hitting an all-time
high of $3,070.90 earlier in the session. Investors are now awaiting the U.S. Personal Consumption
Expenditures data due on Friday to gauge the trajectory for further rate cuts, after the Federal Reserve’s
decision last week to hold its benchmark interest rate steady. Goldman Sachs on Wednesday raised its end
2025 gold price forecast to $3,300 per ounce from $3,100, citing stronger-than-expected ETF inflows and
sustained central bank demand. - US GDP expands by 2.4% in Q4 vs. 2.3% in previous estimate
The US Bureau of Economic Analysis (BEA) reported on Thursday that the United States’ Gross Domestic
Product (GDP) expanded at an annual rate of 2.4% in the fourth quarter. This reading came in above the
market expectation and the previous estimate of 2.3%. “The increase in real GDP in the fourth quarter
primarily reflected increases in consumer spending and government spending that were partly offset by a
decrease in investment. Imports, which are a subtraction in the calculation of GDP, decreased,” the BEA
explained in its press release. - Trump’s new auto tariffs will likely drive up car prices by thousands of dollars
Wall Street analysts warn President Donald Trump’s new auto tariffs could raise prices for U.S. buyers of both
foreign and locally made vehicles. Trump said he will slap 25% tariffs on imported passenger vehicles and
light trucks, as well as on key auto parts including engines, transmissions and powertrain components. Some
singled-out Elon Musk’s Tesla as being the most insulated from the potential harm of the tariffs, due to its
domestic production. The tariffs will kick in at midnight on April 3, and Trump has said they will be
“Permanent.” - US pushes for expansive new deal to control Ukraine’s minerals and energy
The US is pushing for a sweeping new deal to control Ukraine’s critical minerals and energy assets, while
offering Kyiv no security guarantees in return, in an aggressive expansion of its previous demands. Senior
Ukrainian officials said the proposal could undermine their nation’s sovereignty, route profits abroad and
deepen its dependence on Washington. The draft deal marks a dramatic escalation of the Trump
administration’s efforts to seize control of Ukraine’s lucrative natural resources as it presses to bring the
conflict to an end. It would apply to all mineral resources, including oil and gas, and major energy assets
across the entire Ukrainian territory. Washington is demanding that Ukraine and the US set up a supervisory
board to oversee a joint investment fund to split the income from Ukraine’s oil, gas and mineral projects
between the two countries. The Trump administration’s new proposal would supersede the previous
framework agreement on jointly developing Ukraine’s mineral resources agreed last month by Kyiv and
Washington. - Fed’s Collins says it is clear tariffs will drive inflation up near term
Federal Reserve Bank of Boston President Susan Collins said on Thursday that Trump administration tariffs
will drive up U.S. inflation but it is unclear how persistent that upward pressure will be.”It looks inevitable
that tariffs are going to increase inflation in the near term” and it seems more likely than not right now the
jump will be short-lived, she said in an appearance in Boston. Collins also said she fully supported the Fed’s
decision last week to hold rates steady. And with upside risks to inflation and broader uncertainty weighing
on activity, it means that when the U.S. central bank sets the federal funds rate, “I would, looking forward,
expect that holding it steady for a longer time is likely to be appropriate.” She added the Fed should show
“active patience” and stand ready to be flexible. Collins was speaking publicly for the first time since the most
recent gathering of the rate-setting Federal Open Market Committee. Last week the FOMC kept its interest
rate target steady between 4.25% and 4.5%, warning that uncertainty around the outlook had risen. - AppLovin Shares Sink After Muddy Waters Issues Short Report
AppLovin Corp. shares tumbled 20% Thursday, a record one-day drop, after Muddy Waters issued a short
report against the company. AppLovin was one of the top-performing technology stocks in 2024, gaining
more than 700% in a meteoric rise driven by the artificial intelligence frenzy. Muddy Waters’ report alleges
that AppLovin is misappropriating data and violating platforms’ terms of service, among other things. Earlier
reports from Fuzzy Panda, Culper and Bear Cave alleged that AppLovin misrepresents the benefits of its AI
platform and forces app installations as a way to drive up revenue. The company previously responded to the
February reports, saying that they were full of “inaccuracies and false assertions.” - After years of survival, China’s Huawei returns to revenue peak
China’s Huawei is expected to claim triumph over U.S. sanctions at its upcoming annual results, bolstered by
its software push, progress in chips and booming smart-driving technology business that has helped it move
out of “survival mode”. The company is set to confirm that it took 860 billion yuan ($118 billion) in revenues
last year, just shy of its 2020 peak of 891 billion yuan, before chip stockpiles dwindled and U.S. restrictions
cut consumer business revenues in half. Its chairman disclosed its 2024 revenue in February. Huawei’s
executives have previously said Washington’s moves pushed the company into “survival mode”, driving it to
explore new business lines that have largely involved creating products that can serve as alternatives to
Western technology and partnering with local Chinese authorities and government-backed firms - Nvidia-backed CoreWeave downsizes US IPO
CoreWeave reduced the size of its U.S. initial public offering and priced its shares below the indicated range,
the company said on Thursday, dampening expectations that the listing would boost investor appetite for
IPOs. The Nvidia (NVDA.O), opens new tab-backed company is now looking to sell 37.5 million shares, 23.5%
less than originally planned, and price them at $40 apiece, well below even the lower end of the indicated
range. CoreWeave’s roadshow, which began last week, received a weaker-than-expected reception as risk
averse investors in a volatile market weighed concerns over the company’s long-term growth, financial risks
and capital intensity, according to four sources familiar with the matter. - Lululemon shares drop more than 10% as CEO says inflation, economic concerns are weighing on
spending
Lululemon beat Wall Street expectations for fiscal fourth-quarter earnings and revenue, but issued 2025
guidance that disappointed analysts. On an Thursday earnings call, CEO Calvin McDonald said the
athleticwear company conducted a survey earlier this month that found that consumers are spending less
due to economic and inflation concerns, resulting in lower U.S. traffic at Lululemon and industry peers.
However, he said, guests responded well to innovation at the company. Fourth-quarter revenue rose from
$3.21 billion during the same period in 2023. Full-year 2024 revenue came in at $10.59 billion, up from $9.62
billion in 2023. Comparable sales in the Americas were flat, while they grew 20% internationally. Lululemon
has been facing a sales slowdown in the U.S., although McDonald said its U.S. business stabilized in the
second half of the year and partially attributed the improvement to new merchandise. - Ferrari says it will raise prices by 10% on some models to offset auto tariffs
Ferrari said Thursday it will raise prices by 10% on certain models after April 1 in response to new U.S. auto
tariffs, adding up to $50,000 to the price of a typical Ferrari. Last year, Ferrari produced 13,752 cars. The
company plans to launch its first all-electric Ferrari in October. It is unclear what effect the tariffs will have on
Ferrari sales, since there is already a waiting list of more than a year for most of its vehicles. Ferrari buyers
are generally wealthy enough to easily absorb the price hikes. Ferrari also said Thursday it “confirms its
financial targets for 2025” but added that there is a “potential risk of 50 basis points on profitability
percentage margins.” - Nippon Steel Slumps on $7 Billion US Steel Investment Report
Nippon Steel Corp. shares slumped on Friday on a report that the company is considering investing as
much as $7 billion to upgrade United States Steel Corp. facilities if it wins approval for its proposed
$14.1 billion takeover. Shares in US Steel gained more than 7% in after-hours trading in New York
Thursday. Nippon Steel slid as much as 3.98% in Friday trading in Tokyo. The move incorporates the
impact of trading ex-dividend.
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