July 25, 2018, by Lorcan Roche Kelly
Tariffs are great, let’s end them
President Donald Trump said the U.S. and the European Union should drop all tariffs, barriers and subsidies ahead of his meeting today with European Commission President Jean-Claude Juncker. He made the suggestion in a tweet, which ended with “but they won’t!,” suggesting there’s little hope of such an outcome. Earlier yesterday, the president said on Twitter that “tariffs are the greatest.” Juncker said that the EU delegation is in Washington to find out how to avoid a trade war, adding that the bloc is prepared to “immediately” retaliate should talks fail.
Talks back on
Negotiations for a new North America Free Trade Agreement restart in earnest after stalling ahead of Mexico’s presidential election on July 1. Canadian Foreign Affairs Minister Chrystia Freeland will discuss progress in Mexico today with both the incoming and outgoing administrations, while Mexican Economy Minister Ildefonso Guajardo will be in Washington tomorrow to meet with U.S. Trade Representative Robert Lighthizer. Gaping differences remain have yet to be resolved, including car-trade rules and a sunset clause that would kill the deal after five years.
Deutsche Bank, Fiat
Income from trading fixed-income dropped 17 percent from a year earlier to the lowest level since 2008, Deutsche Bank said in a statement this morning. Chief Executive Officer Christian Sewing, in the job less than four months, is accelerating the bank’s turnaround effort by focusing on cost control in an effort to break the “vicious circle” of declining revenue and sticky expenses. Fiat Chrysler’s earnings report today may be overshadowed by the death of former CEO Sergio Marchionne this morning.
Overnight, the MSCI Asia Pacific Index rose 0.4 percent, while Japan’s Topix index closed 0.4 percent higher lifted by strong earnings. In Europe, the Stoxx 600 Index was less than 0.1 percent lower at 5:45 a.m. Eastern Time as investors digested quarterly results while waiting for the outcome of the EU’s trade mission to Washington. S&P 500 futures pointed to a small loss at the open, the 10-year Treasury yield was at 2.936 percent and gold was higher.
Trade talks aside, today’s events are dominated by a slew of earnings. Facebook Inc. reports after the bell, with the social-media giant expected to post record revenue and users in the quarter. Fiat Chrysler, Ford and General Motors will give an indication of the health of the auto-industry when they announce quarterly performance, with analysts on the lookout for any impact from tariffs. Among companies also reporting today are Boeing Co., Coca-Cola Co., PayPal Inc. and Visa Inc.