2025-03-20 20:21

Weekly jobless claims edge up to 223,000 Accenture falls after flagging federal contract cancellations Darden Restaurants climbs after earnings, outlook Indexes off: Dow 0.03%, S&P 500 0.22%, Nasdaq 0.33% NEW YORK, March 20 (Reuters) - U.S. stocks closed slightly lower on Thursday after veering between gains and losses as investors gauged the latest round of economic data and the Federal Reserve's policy statement against tariff concerns. Selling pressure has intensified in recent weeks after a string of economic indicators signaled the economy and consumer sentiment may be cooling as the Trump administration imposes reciprocal trade tariffs. Sign up here. Still, equities rose in three of the prior four sessions, with the benchmark S&P index rallying more than 1% on Wednesday after the Fed kept interest rates unchanged, as widely expected, and indicated two quarter-point interest-rate cuts were likely later this year, the same median forecast as three months ago. The central bank also said it sees slower economic growth and at least temporarily higher inflation. "It is very volatile. The news is very volatile," said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco. "The market's pretty focused on it and a lot of it's going to depend on how certain news items play out over the next couple of weeks." "We're putting a bottom in here, but when I survey the near-term news flow, I don't have a lot of hope that we're going to suddenly leap out of this," he added. The Dow Jones Industrial Average (.DJI) , opens new tab fell 11.31 points, or 0.03%, to 41,953.32, the S&P 500 (.SPX) , opens new tab lost 12.40 points, or 0.22%, to 5,662.89 and the Nasdaq Composite (.IXIC) , opens new tab lost 59.16 points, or 0.33%, to 17,691.63. Economic data on Thursday showed weekly initial jobless claims increased slightly last week, although the outlook may be dimming due to government spending cuts, interest rate levels and policy uncertainty. The Conference Board reported that a measure of future economic activity fell 0.3% in February after easing 0.2% in January. Market participants are pricing in 63 basis points of cuts from the Fed this year, with 71% odds for a cut of at least 25 basis points at the June meeting, according to LSEG data. Technology (.SPLRCT) , opens new tab was among the weakest of the 11 major sectors and the biggest downside weight, while energy (.SPNY) , opens new tab advanced as crude prices rose nearly 2% after the United States issued new Iran-related sanctions. Company profit prospects have been dimming recently due to the uncertain tariff outlook, but Darden Restaurants (DRI.N) , opens new tab shares jumped 5.77% after the Olive Garden owner gave a positive outlook regarding the impact of tariffs on its business. Accenture (ACN.N) , opens new tab shares tumbled 7.26%, its biggest daily percentage drop in a year, after the consultancy firm said the Trump administration's efforts to reduce federal spending have led to delays and cancellations of new contracts. Declining issues outnumbered advancers by a 1.38-to-1 ratio on the NYSE and by a 1.72-to-1 ratio on the Nasdaq. The S&P 500 posted 12 new 52-week highs and no new lows while the Nasdaq Composite recorded 31 new highs and 102 new lows. Volume on U.S. exchanges was 13.06 billion shares, compared with the 16.28 billion average for the full session over the last 20 trading days. https://www.reuters.com/markets/us/futures-tick-up-after-fed-holds-rates-steady-2025-03-20/

2025-03-20 19:55

Macklem emphasizes need for flexible, adaptable monetary policy Uncertainty over US tariffs blamed BoC last changed how it presents forecasts five years ago, due to COVID-19 OTTAWA, March 20 (Reuters) - Uncertainty over the impact of U.S. tariffs means the Bank of Canada could give a range of economic estimates rather than a single forecast when it presents projections next month, Governor Tiff Macklem said on Thursday. The central bank is due to issue its quarterly monetary policy report on April 16, where it predicts growth in the quarters and years ahead. Sign up here. But Macklem said the flip-flopping in U.S. trade policy has made it difficult for the BoC to nail down the assumptions or guideposts within which the Canadian economy will operate. "If we were to prepare that monetary policy report today, I don't think it would have a single central projection," Macklem said during a press conference, saying that the BoC could instead publish a range of outcomes. The BoC last changed how it presents forecasts five years ago, due to the COVID-19 pandemic. The BoC would move back to the usual practise of forecasts when the uncertainty around tariffs lifts, he added. The BoC said in its last monetary policy report that the economy was likely to grow at 1.8% in 2025 and by 2% in the first quarter of this year on an annualized basis. But Macklem cautioned that he does not think "anybody in the governing council can have very high conviction about what the most likely outcome is." Macklem said during his speech that the uncertainty over the effect of U.S. tariffs meant it had to change the way it conducted monetary policy to become less forward-looking than normal. Macklem said that if the BoC guessed where the economy was going and made a mistake, its actions could be ineffective or make matters worse. "So we need to set policy that minimizes the risk. That means being less forward-looking than normal until the situation is clearer," he told a business audience in Calgary, the heart of the oil-rich province of Alberta. "And it may mean acting quickly when things crystallize. We need to be flexible and adaptable," he continued, without giving specific details. Macklem reiterated that there could be no doubt about the BoC's commitment to low inflation, saying it had to ensure that higher prices from tariffs did not spread. The unpredictability makes it unclear how much tariffs will dent demand and how much they will be passed on to consumer prices, Macklem said. The more inflationary the impact, the more focus monetary policy has to put on anchoring inflation expectations, which risk drifting up when inflation rises more and more quickly. The BoC aims to keep inflation at 2%, the mid-point of its 1-3% target range. Macklem said inflation, which the bank managed to quell and bring it down to its target, was likely to rise. "The Canadian economy managed a soft landing. Unfortunately, we're not going to stay on the tarmac for long. We now face a new economic crisis," he said. https://www.reuters.com/markets/bank-canada-could-change-tack-give-range-projections-2025-03-20/

2025-03-20 19:54

By Promit Mukherjee and David Ljunggren OTTAWA, March 20 (Reuters) - The Bank of Canada on Thursday said the uncertainty over the effect of U.S. tariffs meant it had to change the way it conducted monetary policy to become less-forward looking than normal. Sign up here. In a speech, Governor Tiff Macklem said the bank would be focusing less on policy for a specific outlook and more on policy that worked for different outcomes. Macklem said if the bank guessed where the economy was going and made a mistake, its actions could be ineffective or make matters worse. "So we need to set policy that minimizes the risk. That means being less forward-looking than normal until the situation is clearer," he told a business audience in Calgary, the heart of the oil-rich province of Alberta. "And it may mean acting quickly when things crystallize. We need to be flexible and adaptable," he continued, without giving specific details. Macklem reiterated that there could be no doubt about the bank's commitment to low inflation, saying it had to ensure higher prices from tariffs did not spread. The BoC says the constant threat of tariffs and the resulting unpredictability are hurting business investments and consumer sentiment as the United States, by far Canada's biggest trading partner, flips flops on trade policy. "When we have this high degree of uncertainty around the base case, we give more consideration to the risks," Macklem said. The BoC will announce its next monetary policy decision on April 16 which will be accompanied by a new set of projections. The unpredictability makes it unclear how much tariffs will dent demand and how much they will be passed on to consumer prices, Macklem said. The more inflationary the impact, the more focus monetary policy has to put on anchoring inflation expectations, which risk drifting up when inflation rises more and more quickly. The BoC aims to keep inflation at 2%, the mid-point of its 1-3% target range. Macklem said sectors such as energy and agriculture were highly exposed to the prospect of tariffs. To try to keep inflation anchored, the BoC will closely track the pass-through of consumer prices, improve its analysis and enhance its communications, he said. Macklem said inflation, which the bank managed to quell and bring it down to its target, was likely to rise. "The Canadian economy managed a soft landing. Unfortunately, we're not going to stay on the tarmac for long. We now face a new economic crisis," he said. (Reuters Ottawa editorial) Keywords: CANADA CENBANK/ https://www.reuters.com/markets/bank-canada-change-policy-be-less-forward-looking-says-governor-2025-03-20/

2025-03-20 19:50

Chinese tariffs on Canadian farm products kick in March 20 Canadian farmers buying less new equipment, manufacturers say Farmer demand for low-cost loans surging, growers group says REGINA, Saskatchewan, March 20 (Reuters) - Canadian farmers are facing a two-front trade war, with China's tariffs on Canadian canola oil, canola meal and peas taking effect on Thursday and U.S. tariffs expected on additional Canadian products within two weeks. The double whammy from two major trading partners makes for a grim mood going into spring planting. Sign up here. "This is a terrible time," said Calgary area farmer Tara Sawyer of the Chinese tariffs. "The seed has already been bought. The inputs have already been bought. We have to seed it. We have no choice but to move forward," said Sawyer, who grows barley, wheat and canola. China announced on March 8 that tariffs on over $2.6 billion worth of Canadian agricultural and food products would kick in on March 20, retaliating against levies Ottawa introduced in October. The levies match the 100% and 25% import duties Canada slapped on China-made electric vehicles and steel and aluminum products just over four months ago. China said it would apply a 100% tariff to just over $1 billion of Canadian canola oil, canola meal cakes and pea imports, and a 25% duty on $1.6 billion worth of Canadian aquatic products and pork. It excluded unprocessed canola seed, also known as rapeseed. Canada's trade ministry did not immediately respond to a request for comment. On March 8, the trade ministry said Canada was disappointed with the tariff announcement and remained open to dialogue with Chinese officials. China also has an ongoing anti-dumping investigation into Canadian canola seed exports, which make up the vast majority of Canada's canola exports to China. China is the No. 1 export market for Canadian canola seed, and No. 2 for meal exports, after the U.S. China's announcement came in the middle of an escalating trade war with the U.S., where President Donald Trump on March 6 delayed a broad 25% tariff on some Canadian goods for 30 days. Trump has since imposed tariffs on steel and aluminum imports and threatened reciprocal tariffs on additional goods including Canadian dairy and lumber on April 2. Machinery manufacturers at a Canadian farm show said farmers are buying less new equipment, citing low crop prices and the risks of tariffs. Farmers appear to be getting defensive with finances, securing cheap loans to fund this year's crop, but backing away from major purchases. The Canadian Canola Growers Association, which provides government-backed zero-interest and low-interest loans, reported seeing a surge in loan applications. "We're definitely seeing a lot more demand," said Dave Gallant, a vice president at CCGA. "A lot of our customers are very concerned about whether they're going to be able to sell their product this year, and what the prices are going to be." https://www.reuters.com/world/americas/canadian-farmers-face-two-front-trade-war-china-duties-take-effect-2025-03-20/

2025-03-20 19:50

US imposes first sanctions on a China 'teapot' refiner Fourth round of Trump's sanctions on Iran oil sales Treasury blocks 8 tankers for carrying Iranian oil Measures are incremental step-up in pressure - analyst WASHINGTON, March 20 (Reuters) - The U.S. on Thursday issued new Iran-related sanctions, targeting entities including for the first time a Chinese "teapot," or independent refinery, and vessels that supplied crude oil to such processing plants. It was Washington's fourth round of sanctions on Iran's oil sales since President Donald Trump said in February he was re-imposing a "maximum pressure" campaign including efforts to drive down the country's exports to zero. Trump aims to stop Tehran from obtaining a nuclear weapon and funding militant groups. Sign up here. The refinery Treasury targeted for sanctions is China-based Shandong Shouguang Luqing Petrochemical Co., Ltd. "So-called 'teapot' refinery purchases of Iranian oil provide the primary economic lifeline for the Iranian regime, the world’s leading state sponsor of terror and the primary backer of the murderous Houthis in Yemen," U.S. Treasury Secretary Scott Bessent said in a post on X. China does not recognize U.S. sanctions and is the largest importer of Iranian oil. China and Iran have built a trading system that uses mostly Chinese yuan and a network of middlemen, avoiding the dollar and exposure to U.S. regulators. "China has always been firmly opposed to illegal and unjustifiable unilateral sanctions and so-called long-arm jurisdiction by the U.S.," said a spokesperson for the Chinese embassy in Washington. Earlier this month, China and Russia stood by Iran after Washington demanded nuclear talks with Tehran, with diplomats saying dialogue should only resume based on "mutual respect" and all sanctions ought to be lifted. 'MINIMAL PRESSURE' Analysts have said Washington has pursued a path of incremental sanctions, avoiding imposition of measures on big Chinese banks that assist in transactions, a move that could provoke Beijing to retaliate economically. "The strategy appears to target China as a means to pressure Iran - applying only minimal pressure for now while gradually increasing efforts to bring Iran to a nuclear deal," said Scott Modell, chief executive of Rapidan Energy, a research group. State Department spokesperson Tammy Bruce said the refinery bought oil from vessels linked to Yemen's Iran-aligned Houthi movement, which the U.S. designated this month as a Foreign Terrorist Organization, and the U.S.-designated Iranian Ministry of Defense of Armed Forces Logistics. Tehran says its nuclear energy program is for peaceful purposes, while Western powers say its enrichment of uranium to levels approaching weapons-grade has no logical civilian applications. Treasury also imposed sanctions on 12 entities, and identified eight vessels as blocked property it said were responsible for shipping millions of barrels of Iranian oil to China. These vessels are part of Iran’s “shadow fleet” of tankers that supply the private refineries. It also placed Wang Xueqing, who it said is linked to the refinery, on the specially designated nationals, or SDN, list. Americans are prohibited from doing business with people placed on that list, and their U.S. assets are blocked. The vessels Treasury blocked included Panama-flagged Aurora Riley and the Catalina, and the Barbados-flagged Brava Lake. The State Department said it was imposing sanctions on an oil terminal in China called Huaying Huizhou Daya Bay Petrochemical Terminal Storage, for buying and storing Iranian crude oil from a sanctioned vessel. https://www.reuters.com/world/us-issues-fresh-iran-related-sanctions-treasury-dept-says-2025-03-20/

2025-03-20 18:49

Loonie recovers from a six-day low at 1.4401 Canadian small business confidence tumbles Price of oil increases 1.6% 10-year yield rises half a basis point TORONTO, March 20 (Reuters) - The Canadian dollar clawed back its earlier decline against the U.S. dollar on Thursday as oil prices rose and investors weighed comments by Bank of Canada Governor Tiff Macklem for clues that the central bank might pause its interest rate cutting campaign. The loonie was nearly unchanged at 1.4325 per U.S. dollar, or 69.81 U.S. cents, after touching its weakest intraday level since last Friday at 1.4401. Sign up here. Macklem said the uncertainty over the effect of U.S. tariffs meant it had to change the way it conducted monetary policy to become less-forward looking than normal, adding that there could be no doubt about the bank's commitment to low inflation. "That's in line with the hawkish pivot we have seen from the Bank of Canada in recent weeks and reinforces our call for policymakers to hold rates steady in April," Royce Mendes, managing director and head of macro strategy at Desjardins, said in a note. Investors see a roughly 64% chance the BoC moves to the sidelines at its next policy decision on April 16. Canadian small business confidence , opens new tab tumbled this month to an all-time low as the trade war heated up, data from the Canadian Federation of Independent Business showed. Still, the Canadian government bond market is unlikely to return to the record outperformance against U.S. bonds seen in February, as investors are now betting the trade war will slow the U.S. economy as well as hurt Canada's growth. The U.S. dollar (.DXY) , opens new tab rose against a basket of major currencies after the Federal Reserve indicated that it was in no rush to cut rates further this year. The price of oil , one of Canada's major exports, was trading 1.6% higher at $68.24 a barrel, supported by a higher-than-expected fuel inventory drawdown in the United States. The Canadian 10-year yield was up half a basis point at 3.008%. https://www.reuters.com/markets/currencies/canadian-dollar-recoups-losses-investors-eye-boc-rate-cut-pause-2025-03-20/