2025-06-27 22:04
European suppliers receive enough licences to avoid disruptions, but many permits still pending China's export restrictions cause 75% drop in rare earth magnet exports U.S.-China deal aims to expedite rare earth shipments to U.S. companies BERLIN/BEIJING, June 27 (Reuters) - The threat of mass shutdowns across the automotive supply chain is fading as Chinese rare earth magnets begin to flow, though automakers and suppliers say production plans still face uncertainties and a continued risk of shortages. European suppliers have received enough licences to avoid the widespread disruptions predicted earlier this month but hundreds of permits remain pending, said Nils Poel, head of market affairs at supplier association CLEPA. Sign up here. The rate of issuance is "accelerating" and has risen to 60% from 25%, he said, but cases where the end users are based in the United States, or where products move through third countries like India, are taking longer or not being prioritised. "Overall the feeling is that we probably will still have production in July and that the impact will be manageable," he said. "Maybe here and there a production line will be affected, but we have avoided that for the moment." On Friday, Ford (F.N) , opens new tab CEO Jim Farley said during an appearance in Colorado that the company has had to shut down factories over the past three weeks because of magnet shortages, without elaborating. Volkswagen (VOWG.DE) , opens new tab said in a statement to Reuters its supply of rare earth components was stable while rival Stellantis (STLAM.MI) , opens new tab said it had addressed its immediate production concerns. China restricted exports of seven rare earths and related magnets in April in retaliation for U.S. tariffs. Three months later there remains huge uncertainty about how it intends to police its opaque and complex export licensing system. Since the restrictions were imposed, rare earth magnet exports from China have fallen roughly 75%, forcing some automaker production lines to halt in Asia, Europe and the United States. FROM 'FULL PANIC' TO 'BARE MINIMUM' The White House said on Thursday it had signed a deal with China to speed up rare earth approvals without providing details. Beijing said hours later both parties had confirmed details of the deal struck in London earlier this month, which was meant to resolve the rare earth issue, and it would process export licences in accordance with the law. Neither party detailed any changes to the existing export licensing system. U.S. Treasury Secretary Scott Bessent said in an interview with Fox Business Network on Friday that, under the agreement announced on Thursday, rare earth shipments to the United States from China would be expedited to all companies that have previously received them on a regular basis. "I am confident now... the magnets will flow," Bessent said. "This is a de-escalation." Two weeks ago the car industry was in a "full panic," but licence approvals by China have sped up and there is now less threat of a sudden stop, according to an executive at a leading U.S. automotive supplier and a source with knowledge of the supply chain at a major European carmaker. Both asked not to be named because of the sensitivity of the issue. China is approving the "bare minimum" of critical licences for European firms to avoid production stoppages, a European official told Reuters, also speaking on condition of anonymity. U.S. magnet maker Dexter Magnetic Technologies, which has defence clients, among others, has received just five of 180 licences since April, CEO Kash Mishra told Reuters, adding those were intended for non-defence sectors. "It's an extended delay," he said. "It's 45 days trying to get the paperwork right for the supplier, and then it's 45 more days or so before any licences are granted." https://www.reuters.com/world/china/chinas-rare-earths-are-flowing-again-not-freely-2025-06-27/
2025-06-27 21:27
WASHINGTON, June 27 (Reuters) - U.S. President Donald Trump said on Friday he would "love" if Federal Reserve Chair Jerome Powell were to resign, and the president also said he wanted interest rates cut to 1%. KEY QUOTES "I'd love him to resign if he wanted to, he's done a lousy job," Trump said, also labeling the Fed chair as "stupid." Sign up here. "I think we should be paying 1% right now, and we're paying more because we have a guy who suffers from, I think, Trump Derangement Syndrome," Trump added. WHY IT'S IMPORTANT Trump has long attacked the Federal Reserve chair over interest rates that the U.S. president wants lowered. Fed chairs have long been seen as insulated from presidential dismissal for reasons other than malfeasance or misconduct, but Trump has threatened to test that legal premise with frequent threats to fire Powell. Powell's term ends in May 2026, and Trump is expected to nominate a successor in the coming months. CONTEXT Trump said he will name as successor to Powell someone who will lower rates. Last week, the Fed decided to leave short-term borrowing costs in the 4.25%-4.50% range. https://www.reuters.com/business/finance/trump-says-he-wants-interest-rate-cut-1-would-love-if-powell-resigned-2025-06-27/
2025-06-27 20:35
ORLANDO, Florida, June 27 (Reuters) - - TRADING DAY Making sense of the forces driving global markets Sign up here. By Jamie McGeever, Markets Columnist I'd love to hear from you, so please reach out to me with comments at [email protected] , opens new tab. You can also follow me at @ReutersJamie and @reutersjamie.bsky.social. Just a heads up, Trading Day will be in the capable hands of Lewis Krauskopf next week and Alden Bentley the following week, while I take some time off to recharge the batteries. Back on July 13. Another extraordinary week ended on Friday with the S&P 500 and Nasdaq hitting all-time highs as investors ramped up bets that U.S. interest rates will soon fall, a stunning turnaround from the post-'Liberation Day' tariff gloom of early April. Several developments this week fed into the rate cut narrative - the Iran-Israel ceasefire, tumbling oil prices, soft U.S. economic data, dovish comments from some Fed officials, and renewed pressure from President Donald Trump on the Fed to ease. Fed Chair Jerome Powell pushed back against suggestions rates could be cut as soon as July, arguing that the impact of tariffs should be assessed first, and the consensus among the Fed's 19 rate-setters is to hold the line too. But traders are now leaning towards three quarter-point rate cuts this year. Progress on trade is also boosting investor sentiment. Trump said a deal between the US and China had been signed, but did not provide details, and Treasury Secretary Scott Bessent said the two countries have resolved issues surrounding shipments of rare earth minerals and magnets to the US. That said, trade optimism was dented on Friday after Trump abruptly cut off trade talks with Canada over its new tax on U.S. technology firms, calling it a "blatant attack" and saying he will set a new tariff rate on Canadian goods next week. The most significant market move of the week, however, was not in equities but in currencies. The dollar continued its decline, and is now down more than 10% this year. That's its worst first-half performance of any year in more than 50 years. It should be remembered, however, that the dollar started the year at extremely expensive levels, so some adjustment was always likely. This is proving to be a pretty severe adjustment, one which markets and policymakers appear to be relaxed about. For now. This Week's Key Market Moves Chart of the Week Self-explanatory really. When the world's reserve currency has its steepest January-June decline since the era of free-floating exchange rates began over half a century ago, something major is underway. How big remains to be seen. But if the Trump administration wanted a weaker currency, it can't complain. Here are some of the best things I read this week: What could move markets on Monday? Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles , opens new tab, is committed to integrity, independence, and freedom from bias. Trading Day is also sent by email every weekday morning. Think your friend or colleague should know about us? Forward this newsletter to them. They can also sign up here. https://www.reuters.com/business/autos-transportation/global-markets-trading-day-graphic-2025-06-27/
2025-06-27 20:31
June 27 (Reuters) - The S&P 500 and the Nasdaq Composite hit all-time highs on Friday as renewed AI enthusiasm and the prospect of a looser monetary policy powered a recovery in U.S. stocks from months-long rout. The benchmark index (.SPX) , opens new tab rose 0.59% to 6,178.80 points, surpassing the previous peak of 6,147.43 on February 19, while the tech-heavy Nasdaq gained 0.59% to 20,299.72 points, exceeding its record high of 20,204.58 on December 16. Sign up here. Markets rallied this week as an upbeat forecast from chipmaker Micron (MU.O) , opens new tab revived investor confidence on artificial intelligence, while Nvidia (NVDA.O) , opens new tab inched closer to $4 trillion market capitalization after reclaiming its position as the world's most valuable company. The AI bellwether (NVDA.O) , opens new tab rose 1.4% and Advanced Micro Devices (AMD.O) , opens new tab 1.6%, while megacaps Meta (META.O) , opens new tab added 0.7% and Amazon.com (AMZN.O) , opens new tab 1.15%. Risk appetite also benefited from a U.S.-brokered ceasefire to a 12-day air battle between Israel and Iran that sparked a jump in crude prices and raised worries of higher inflation. Dovish remarks from Federal Reserve policymakers have aided sentiment, while a string of soft economic data and expectations that Trump would replace U.S. Federal Reserve Chair Jerome Powell with somebody more dovish next year have pushed up rate-cut bets. Trump's April 2 "reciprocal tariffs" on major trading partners and their chaotic rollout had put the S&P 500 within a striking distance of confirming a bear market when it ended down 19% from its February 19 record closing high. The Nasdaq had tumbled 26.7% from its previous peak, marking a bear market days after Trump's "Liberation Day" on April 2. Since then, U.S. trade deals with the UK and China have firmed up market expectations for more such agreements, fueling hopes that a global recession could be avoided. "The two key pillars to this market, the consumer and their potential to spend, and corporate America are very resilient. And that's given this market confidence to get back to all-time highs," said David Wagner, head of equities and portfolio manager at Aptus Capital Advisors. The S&P 500 has surged more than 23.5% and the Nasdaq about 32% since their recent lowest close on April 8, largely powered by a handful of megacap stocks such as Microsoft (MSFT.O) , opens new tab, Nvidia (NVDA.O) , opens new tab, Meta Platforms (META.O) , opens new tab and Amazon (AMZN.O) , opens new tab. If the Nasdaq closes above the December 16 record close at 20,173.89, it would be the end of the bear market and start of a new bull market, according to common definitions. A bear market is defined as a 20% decline from a record high close, on a closing basis. Both the Nasdaq and S&P 500 have gained 5% this year. The blue-chip Dow (.DJI) , opens new tab has risen about 2.8% this year and remains about 3% below its all-time peak. https://www.reuters.com/business/finance/sp-500-nasdaq-hit-record-highs-renewed-ai-bets-rate-cut-hope-2025-06-27/
2025-06-27 20:30
Indexes up: Dow 1.00%, S&P 500 0.52%, Nasdaq 0.52% Nasdaq confirms bull market Nike rises after better-than-expected Q1 revenue forecast Washington, Beijing in deal to speed rare earth shipments to US Trump cancels trade talks with Canada over digital tax NEW YORK, June 27 (Reuters) - Wall Street extended its rally on Friday, sending S&P 500 and Nasdaq to all-time closing highs as trade deal hopes fueled investor risk appetite and economic data helped solidify expectations for rate cuts from the U.S. Federal Reserve. Stocks pared gains after U.S. President Donald Trump terminated trade negotiations with Canada in response to its digital tax on technology companies. Sign up here. Even so, all three major U.S. stock indexes posted weekly gains. Upon reaching its record closing high, the tech-heavy Nasdaq confirmed it entered a bull market when it touched its post "liberation day" trough on April 8. The blue-chip Dow remained 2.7% below its record closing high reached on December 4. "This market's been pretty resilient," said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana. "Investors are riding momentum and looking for breakouts." "They don't want to get caught on the wrong side of this thing," Carlson added. "Many investors already have missed out. And now you have the S&P flirting with an all-time high." The Personal Consumption Expenditures report from the Commerce Department showed consumer income and spending unexpectedly contracted in May. And while tariffs have yet to affect price growth, inflation continues to hover above the Fed's 2% annual inflation target. A separate report from the University of Michigan confirmed consumer sentiment has improved this month, but remains well below December's post-election bounce. Financial markets have priced in a 76% likelihood that the Fed will implement its first rate cut of the year in September, with a smaller, 19% probability of a rate cut coming as soon as July, according to CME's FedWatch tool. Washington and Beijing reached an agreement to expedite rare-earth shipments from China to the U.S., a official said, well ahead of the July 9 expiration of the 90-day postponement of U.S. President Donald Trump's "reciprocal" tariffs. Additionally, U.S. Treasury Secretary said the administration's trade deals with 18 of the main U.S. trading partners could be done by the September 1 Labor Day holiday. The Dow Jones Industrial Average (.DJI) , opens new tab rose 432.43 points, or 1.00%, to 43,819.27, the S&P 500 (.SPX) , opens new tab gained 32.05 points, or 0.52%, to 6,173.07 and the Nasdaq Composite (.IXIC) , opens new tab gained 105.55 points, or 0.52%, to 20,273.46. Among the 11 major sectors of the S&P 500, consumer discretionary (.SPLRCD) , opens new tab enjoyed the biggest percentage gain, while energy shares (.SPNY) , opens new tab were the laggards. Chipmaker Micron'sMU.O , opens new tab upbeat forecast revived investor confidence in artificial intelligence-related stocks, while Nvidia NVDA.O , opens new tab rose 1.8%, edging closer to $4 trillion market capitalization after its position as the world's most valuable company. Nike's shares NKE.N , opens new tab jumped 15.2% after forecasting a smaller-than-expected drop in first-quarter revenue. Advancing issues outnumbered decliners by a 1.29-to-1 ratio on the NYSE. There were 347 new highs and 55 new lows on the NYSE. On the Nasdaq, 2,111 stocks rose and 2,342 fell as declining issues outnumbered advancers by a 1.11-to-1 ratio. The S&P 500 posted 35 new 52-week highs and 6 new lows while the Nasdaq Composite recorded 101 new highs and 68 new lows. Volume on U.S. exchanges was 22.07 billion shares, compared with the 18.27 billion average for the full session over the last 20 trading days. https://www.reuters.com/business/us-stock-futures-rise-rate-cut-hopes-ahead-inflation-data-2025-06-27/
2025-06-27 20:22
June 27 (Reuters) - The Inter-American Development Bank (IDB) approved a conditional credit line of $2 billion to strengthen fiscal management in Brazil, it said on Friday. The funds will go toward modernizing the South American nation's tax management processes and systems, the lender said in a statement, starting with an initial $30 million loan for the state of Amazonas. Sign up here. https://www.reuters.com/business/finance/idb-approves-2-billion-credit-line-brazil-2025-06-27/
