- Stock Rally Loses Steam After Mixed Tariff News: Markets Wrap
Asian stocks snapped a five-day winning streak as a brief global relief rally gave up momentum after mixed
signals from the Trump administration on its plans for China tariffs. A regional gauge of stocks fell 0.3% as
market enthusiasm got curbed after Treasury Secretary Scott Bessent cast doubt on a timely resolution to the
US-China trade war. Shares in Hong Kong dropped 1.2%, the first time in four days, while equity-index futures
for the US and Europe declined. The yen flipped after two days of losses and the dollar weakened. Gold jumped
1.2% in increased demand for the safe-haven asset. The global rally in stocks on Wednesday – after wild
gyrations earlier this month – came on signs US President Donald Trump is rethinking the most-aggressive
elements of his stances on trade and the Federal Reserve. Still, investors find it hard to forecast where the
markets are headed amid a slew of headlines and frequent back-and-forth by Trump on his tariffs. - Dow closes 400 points higher, but ends session well off the highs of the day
Stocks rose Wednesday on hopes that U.S.-China trade tensions could soon ease, while President Donald
Trump signaled he does not plan to remove Federal Reserve Chair Jerome Powell from his post as central bank
leader. The Dow Jones Industrial Average popped 419.59 points, or 1.07%, to close at 39,606.57. The S&P 500
climbed 1.67% to end at 5,375.86, and the Nasdaq Composite rallied 2.50% and settled at 16,708.05. All three
indexes posted back-to-back gains. However, the major averages ended the session well off their highs. At one
point Wednesday morning, the blue-chip Dow added more than 1,100 points, and the S&P 500 was up 3.44%. - Oil falls 2% after sources say OPEC+ to mull accelerating output
Oil prices slipped 2% on Wednesday as sources said OPEC+ would consider accelerating its oil output increases
in June, but losses were curbed following a report that U.S. President Donald Trump may cut tariffs on Chinese
imports. Brent crude futures settled down $1.32, or 1.96%, at $66.12 a barrel, while U.S. West Texas
Intermediate crude ended $1.40, or 2.2%, lower at $62.27. Global benchmark Brent hit a session high at $68.65,
its highest since April 4, before the OPEC+ news. Several OPEC+ members will suggest that the group accelerate
oil output increases for a second consecutive month in June, three sources familiar with OPEC+ talks told
Reuters. There have been recent tensions among OPEC+ members over compliance with production quotas.
“It wouldn’t surprise me that OPEC wants to raise production. It could raise concerns about the cohesion of
the cartel. Maybe they’re tired of holding back production increases,” said Phil Flynn, an analyst with Price
Futures Group. Both benchmarks pared some losses in early afternoon trade after Kazakhstan’s Energy Ministry
issued a statement saying that Kazakhstan, not an OPEC member but an ally in the OPEC+ group, was a
responsible participant in the international energy community and it was interested in predictability and the
demand and supply balance. Kazakhstan has angered other OPEC+ members by producing more than its
allotted quota. “Our participation in OPEC+ is an important tool for ensuring global stability, creating conditions
for the implementation of national plans and attracting investment. We are committed to constructive work
within the framework of the agreement and fulfilling our obligations,” the statement quoted Energy Minister
Erlan Akkenzhenov as saying. - Gold falls 3% as Trump comments on Fed and China boost risk sentiment
Gold on Wednesday extended its retreat from an all-time high, falling more than 3%, as appetite for riskier
assets improved after President Donald Trump said he has no plans to fire the U.S. Fed’s chief and also signalled
progress with China on the tariff front. Spot gold slipped 3% to $3,281.6 an ounce by 1:43 p.m. ET (1743 GMT),
after hitting a record high of $3,500.05 in the previous session. U.S. gold futures dropped 3.7% to settle at
$3,294.10. “The market is starting to move past the tariff crash. You’re going to see a broad rotation out of
some of the safe haven assets back chasing some of the specific names like Apple, Tesla,” said Phillip Streible,
chief market strategist at Blue Line Futures. Sentiment in wider financial markets improved and the dollar
rebounded after Trump backed off from threats to fire Jerome Powell after days of intensifying criticism of the
Federal Reserve chief for not cutting interest rates. U.S. Treasury Secretary Scott Bessent said on Wednesday
that he believes excessively high tariffs between the U.S. and China will have to come down before trade
negotiations can proceed. Gold, used as a safe store of value during times of political and financial uncertainty,
has gained more than 26% since the start of 2025, boosted by central bank buying, tariff war fears and strong
investment demand. “From a technical perspective, the blowout top around $3,500 and sharp reversal has, in
the short term, raised the risk of a deeper correction,” Ole Hansen, head of commodity strategy at Saxo Bank,
said in a note. Silver was up 3% at $33.48 an ounce, platinum gained about 1.1% to $969.1 and palladium was
steady at $935.59. - China to allow overseas investors access to more sectors
China’s state regulator and planning council published a new version of its “negative list” that relaxes barriers
to entering the world’s second-largest economy, reducing the number of restricted industries to 106 from 117.
The so-called negative list specifies industries where activities by foreign investors are either restricted or
prohibited. It was first issued in 2018 by Beijing. The relaxation comes as U.S. tariffs threaten more pressure
on China’s economy, which is already reeling from weak domestic consumption and a debt crisis in the property
sector. China’s National Development and Reform Commission said in a statement on Thursday that the 2025
version of the list lowers the “entry threshold and stimulates market vitality”. A number of areas have been
partially liberalized, the NDRC said, including television production, telecommunication services, online
information services for pharmaceuticals and medical devices, the use of radioactive drugs by medical
institutions, and the import of forest seeds. Local governments are also encouraged to allow greater access in
areas such as transportation and logistics, freight forwarding and vehicle rental services. Market access to
investing in unmanned aerial vehicles and new tobacco products, such as e-cigarettes, is included on the
negative list to “ensure a safe bottom line”, the regulator said, without giving further details. China had said in
February it would further break down investment barriers and revise its negative list for market access as soon
as possible. - U.S. lawmakers subpoena China telecom giants over security concerns
The leaders of a U.S. congressional committee on Wednesday moved to force China’s three telecom giants to
cooperate with an investigation into their alleged support for the Chinese military and government, according
to letters seen by Reuters. In a bipartisan effort, the House of Representatives’ select committee on China used
its seldom exercised subpoena powers in an effort to compel China Mobile, China Telecom, and China Unicom
to answer questions about whether they could exploit access to American data through their U.S. cloud and
internet businesses. Democratic and Republican lawmakers continue to express concern over the Chinese
telecoms’ U.S. operations following high-profile Chinese-led cyberattacks, including Volt Typhoon, which the
FBI said has allowed China to gain access to American telecommunications, energy, water and other critical
infrastructure. Beijing has denied responsibility for those attacks. A spokesperson for China’s embassy in
Washington said in a statement: “We oppose the U.S. over-stretching the concept of national security, using
national apparatus and long-arm jurisdiction to bring down Chinese companies.” The committee’s Republican
chair John Moolenaar and its top Democratic Representative Raja Krishnamoorthi in March had sought the
companies’ responses to questions after a 2024 Reuters report that they were under U.S. Commerce
Department investigation. The committee said the companies had ignored that request. The Federal
Communications Commission (FCC) denied China Mobile’s application to provide U.S. telecommunications
service in 2019 and revoked China Telecom and China Unicom’s authorizations in 2021 and 2022. But the
companies still have a small presence in the U.S., for example, providing cloud services and routing wholesale
U.S. internet traffic. U.S. regulators and lawmakers fear that the companies could access personal information
and intellectual property stored in their clouds and provide it to the Chinese government or prevent Americans
from gaining access. In three similar letters dated April 23 notifying the companies of the subpoenas,
Moolenaar and Krishnamoorthi said the select committee had received information indicating the companies
“may continue to maintain network Points of Presence, data center access, and cloud-related offerings in the
United States, potentially through subsidiaries or affiliates.” They called for the companies’ full cooperation by
May 7. The companies did not immediately respond to Reuters’ requests for comment. China’s embassy in
Washington also did not respond immediately, but it has previously said the U.S. sought to suppress Chinese
companies under “false pretexts.” - Apple, Meta hit by EU with fines worth 700 million euros
Apple and Facebook-owner Meta Platforms (NASDAQ:META) have been fined hundreds of millions of dollars
by the European Union for not following the bloc’s rules governing tech companies. The iPhone-maker faces a
penalty of 500 million euros, or about $570 million, while Meta was fined 200 million euros, according to the
European Commission, the executive arm of the EU. In a statement, the Commission said it found that Apple
(NASDAQ:AAPL) failed to comply with a rule that allows app developers on its App Store to inform customers,
“free of charge, of alternative offers outside the App Store, steer them to those offers and allow them to make
purchases.” “Due to a number of restrictions imposed by Apple, app developers cannot fully benefit from the
advantages of alternative distribution channels outside the App Store,” the Commission added. “Similarly,
consumers cannot fully benefit from alternative and cheaper offers as Apple prevents app developers from
directly informing consumers of such offers.” Meanwhile, the Commission said Meta’s “Consent or Pay”
advertising model, which lets EU users of Facebook and Instagram choose between consenting to combining
their personal data between the platforms for personalized marketing or paying a monthly subscription for an
ad-free service, was also not compliant with the bloc’s regulations. - Intel is poised to announce plans this week to cut more than 20% of its staff, aiming to eliminate
bureaucracy at the struggling chipmaker, according to a person with knowledge of the matter
The move is part of a bid to streamline management and rebuild an engineering-driven culture, the person
said, asking not to be identified because the plans are private. It would be the first major restructuring under
new Chief Executive Officer Lip-Bu Tan, who took the helm last month. The cutbacks follow an effort last year
to slash about 15,000 jobs — a round of layoffs announced in August. Intel had 108,900 employees at the end
of 2024, down from 124,800 the previous year. Intel shares rose 5.5%. The company is scheduled to report
first-quarter results on Thursday, giving Tan an opportunity to lay out more of his strategy. Though the worst
of Intel’s revenue declines are now behind it, according to Wall Street estimates, analysts aren’t projecting a
return to its previous sales levels for years, if ever. - Boeing reported first-quarter results that exceeded estimates. Shares rose 6.1%
The planemaker used $2.3 billion in free cash in the three months ended March 31 as it ramped up jet
production. That’s better than the $3.4 billion withdrawal that analysts had predicted. The adjusted loss per
share of 49 cents was the smallest in more than a year. Calling 2025 “our turnaround year,” Chief Executive
Officer Kelly Ortberg said the company is on track to raise output of its cash-cow 737 Max jetliner over the next
few months to the 38-jet monthly cap imposed by US regulators. The company will then seek permission to go
to 42 units “later this year,” a move that would help generate cash that’s been depleted by a recent strike and
manufacturing crises. Boeing’s commercial and defense divisions both showed improvements, with the
defense unit posting a $155 million operating profit and 2.5% margin. Boeing’s plane division narrowed its
operating loss to $537 million. At the same time, Boeing remains susceptible to the fallout from
President Donald Trump’s tariff, which have halted aircraft deliveries to China, the world’s second-biggest
aviation market after the US. Ortberg previously warned that suppliers also risk getting caught up in the trade
hostilities, potentially driving up costs and leading to delays in aircraft production. Also, Boeing announced the
sale of its flight navigation unit and other digital assets to Thoma Bravo for $10.6 billion in cash, marking
Ortberg’s first major portfolio adjustment that gives the company a solid cash infusion. - Lam Research reported higher profit and revenue in its latest quarter, driven by opportunities to expand
its market share and increase the intensity of production for semiconductors
The company, which makes and services equipment used for semiconductors, reported a third-quarter profit
of $1.33 billion, or $1.03 a share, for the three months ended March 30, compared with $966 million, or 73
cents a share, in the same quarter a year ago. Excluding one-time items, per-share earnings were $1.04, above
the $1 a share that analysts were expecting. Revenue rose to $4.72 billion, within the company’s previously
issued guidance for the quarter. Analysts had forecast sales of $4.64 billion. Revenue was $3.79 billion during
the same period last year. For the current quarter, Lam Research said it expects between $4.7 billion and $5.3
billion in revenue, and earnings per share between $1.10 and $1.30. Analysts expected earnings of 98 cents a
share on $4.59 billion in revenue in the current quarter. “Our outlook remains strong even as we address near
term tariff-related uncertainty, and we are highly confident in our ability to outperform semiconductor industry
growth in the years to come,” Chief Executive Tim Archer said. Shares rose 2.7% in afterhours trading. - T Misses Q1 Earnings Estimates Despite Higher Revenues
AT&T Inc. T reported mixed first-quarter 2025 results with adjusted earnings missing the Zacks Consensus
Estimate revenues beating the same. The company witnessed solid wireless traction and customer additions, which were partially offset by lower demand for legacy voice and data services. AT&T recorded strong subscriber growth backed by a resilient
business model and robust cash flow position, driven by a diligent execution of operational plans. AT&T expects
to continue investing in key areas of 5G and fiber and adjust its business according to the evolving market
scenario to fuel long-term growth. On a GAAP basis, AT&T reported a net income of $4.39 billion or 61 cents
per share compared with $3.39 billion or 47 cents per share in the year-ago quarter. The significant
improvement was primarily attributable to higher contributions from the DIRECTV investments during the
quarter. Excluding non-recurring items, adjusted earnings improved to 51 cents per share from 48 cents a year
ago. - NextEra Energy’s Q1 Earnings Beat Estimates, Revenues Miss
NextEra Energy, Inc. NEE reported first-quarter 2025 adjusted earnings of 99 cents per share, which beat the
Zacks Consensus Estimate of 97 cents by 2.1%. The bottom line was also up nearly 8.8% year over year. The
year-over-year improvement in earnings per share was due to solid financial and operational performance at
both of its businesses. GAAP earnings per share for the first quarter were 40 cents compared with $1.1 in the
year-ago period. In the first quarter, NextEra Energy’s operating revenues were $6.24 billion, which lagged the
Zacks Consensus Estimate of $7.34 billion by 14.9%. However, the top line improved 9% year over year.
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