Friday, 4 July 2025

Tariffs, T-Day Minus 4. US Jobs Strong. Trump v Xi, Who Won? BBB Passes.

Baltic Dry Index. 1434 -09                Brent Crude 68.58

Spot Gold 3340                    US 2 Year Yield 3.88 +0.10

US Federal Debt. 37.058 trillion

US GDP 30.112 trillion.

A Happy US Independence Day to those readers celebrating today.

The American colonies, all know, were greatly opposed to taxation without representation. They were also, a less celebrated quality, equally opposed to taxation with representation.

John Kenneth Galbraith

With US stock casinos closed today celebrating Independence Day, Asian and European markets will likely fret over next week’s looming Trump tariff deadlines of July 8th and 9th.

Next week, the US stock casinos will likely worry over the differing US jobs pictures provided by ADP v the BLS jobs figures released yesterday.

Another complication, later today President Trump will sign into law his  “Big Beautiful Bill” of spending, tax breaks and welfare reform. I wonder what could possibly go wrong with welfare reform?

Little need for my input today.

Tomorrow, more on that Air India 787-8 crash, with the preliminary findings due for release by July 11th.

Asia-Pacific markets trade mixed ahead of Trump’s deadline for higher tariffs

Updated Fri, Jul 4 2025 12:19 AM EDT

Asia-Pacific markets traded mixed Friday as investors await details on the U.S.′ trade deals ahead of U.S. President Donald Trump’s deadline for higher tariffs next week.

Japan’s Nikkei 225 benchmark declined 0.13% in choppy trade while the broader Topix index lost 0.22%.

In South Korea, the Kospi index declined by 1.41% while the small-cap Kosdaq dropped by 1.86%.

Mainland China’s CSI 300 index added 0.41% in choppy trade, while Hong Kong’s Hang Seng Index fell 0.62%.

Over in Australia, the S&P/ASX 200 was flat.

Meanwhile, India’s benchmark Nifty 50 and BSE Sensex started the day flat.

Overnight stateside, a better-than-expected jobs report eased investors’ concerns of a slowdown in the U.S. economy and pushed the S&P 500 and Nasdaq Composite to fresh record highs.

The Dow Jones Industrial Average advanced 344.11 points, or 0.77%, settling at 44,828.53. The S&P 500 added 0.83% to close at 6,279.35, while the Nasdaq gained 1.02% and ended at 20,601.10. Both the S&P 500 and the Nasdaq Composite also closed at records.

U.S. markets are closed on Friday for the Independence Day public holiday.

Asia stock markets today: live updates

Trump Set to Sign Tax-and-Spend Bill That Reshapes Domestic Policy

July 3, 2025 at 10:00 PM GMT+1

President Donald Trump secured a sweeping shift in US domestic policy as the House of Representatives narrowly passed his tax and spending bill. 

The $3.4 trillion fiscal package, passed by a vote of 218-214, cuts taxes, curtails spending on safety-net programs and reverses much of former President Joe Biden’s efforts to move the country toward a clean-energy economy. The House now sends the legislation to Trump, in time for a July 4 deadline he set.

The president leveraged his sway over the Republican Party through threats of primary challenges, White House lobbying sessions and golf-course socializing to overcome resistance from both conservative hardliners concerned about the measure’s debt impact and swing-state GOP moderates worried about the scale of Medicaid cuts.

In the end, only two Republicans, Thomas Massie of Kentucky and Brian Fitzpatrick of Pennsylvania, joined with Democrats to oppose the bill.

In a futile attempt to block a final vote on the massive bill, House Democratic Leader Hakeem Jeffries spoke for 8 hours and 45 minutes, breaking the record for the House’s longest “magic minute” floor speech. “This legislation will end Medicaid as we know it,” Jeffries said during the marathon speech. “Rural hospitals will close, nursing homes will close.” Jordan Parker Erb

Trump Set to Sign Tax-and-Spend Bill That Reshapes Domestic Policy - Bloomberg

U.S. payrolls increased by 147,000 in June, more than expected

Published Thu, Jul 3 20258:30 AM EDT

Job growth proved better than expected in June, as the labor market showed surprising resilience and likely taking a July interest rate cut off the table.

Nonfarm payrolls increased a seasonally adjusted 147,000 for the month, higher than the estimate for 110,000 and just above the upwardly revised 144,000 in May, the Bureau of Labor Statistics reported Thursday. April’s tally also saw a small upward revision, now at 158,000 following an 11,000 increase.

The unemployment rate fell to 4.1%, the lowest since February and against a forecast for a slight increase to 4.3%. A more encompassing rate that includes discouraged workers and those holding part-time positions for economic reasons edged down to 7.7%.

Though the jobless rates fell, it was due largely to a decrease in those working or looking for jobs. The labor force participation rate fell to 62.3%, its lowest level since late 2022 as the labor force, owing to an increase of 329,000 of those not counted in the labor force. The household survey, which is used to calculate the unemployment rate, showed a smaller gain of just 93,000.

Stock market futures held positive following the report while Treasury yields rose sharply in a trading session that will end early ahead of the Independence Day holiday in the U.S.

“The solid June jobs report confirms that the labor market remains resolute and slams the door shut on a July rate cut,” said Jeff Schulze, head of economic and market strategy at ClearBridge Investments. “Today’s good news should be treated as such by the markets, with equities rising despite the accompanying pickup in interest rates.”

Along with the solid payroll gains and fall in the unemployment rate, average hourly earnings increased 0.2% for the month and 3.7% from a year ago. The average work week moved slightly lower to 34.2 hours.

Government employment posted a large gain, leading all categories with an increase of 73,000 due to solid boosts in state and local hiring, particularly in education-related jobs. Federal government, which is still feeling the impact of cuts from Elon Musk’s Department of Government Efficiency, lost 7,000.

In addition, health care again was strong, adding 39,000, while social assistance contributed 19,000.

The report comes with an intensified focus on where the Fed heads with monetary policy as signs increasingly appear of a slowing labor market while President Donald Trump’s tariffs thus far have produced a muted impact on inflation.

Trump has demanded the Fed lower its benchmark interest rate, which it has kept steady in a range between 4.25%-4.5% since December. Along with that, the president on Wednesday up the stakes, saying in a Truth Social post that Powell “should resign immediately.”

For his part, Powell has kept a cautious tone on policy. In an appearance Tuesday, the central bank leader said that while every meeting is on the table for a rate cut, the strength of the U.S. economy is affording time to evaluate the incoming data.

Market pricing shifted strongly following the payrolls report, with traders all but taking the chance of a July rate cut off the table. Odds for a July move fell to 4.7%, down from 23.8% on Wednesday, according to the CME Group’s FedWatch. The market continues to see the next reduction not coming until September and also reversed expectations for three total cuts this year, with the likelihood now reduced to two.

There had been some speculation ahead of the report that a weak number was possible, with private payrolls service ADP on Wednesday reporting a loss of 33,000. However, the BLS report showed a gain of 74,000.

Those getting jobs titled strongly to full-time positions, which increased by 437,000. Part-time workers fell by 367,000.

Jobs report June 2025:

As trade war truce with China holds, US lifts curbs for chip design software and ethane

July 3, 2025 8:20 AM GMT+1

NEW YORK, July 3 (Reuters) - The United States has lifted restrictions on exports to China for chip design software developers and ethane producers, a further sign of de-escalating U.S.-Sino trade tensions including concessions from Beijing over rare earths.

Synopsys (SNPS.O), opens new tab, Cadence Design Systems (CDNS.O), opens new tab and Siemens (SIEGn.DE), opens new tab, three of the world's largest electronic design automation (EDA) software developers, said on Wednesday they are restoring access to their software and technology for customers in China.

Earlier in the day, the U.S. also sent letters to ethane producers to rescind a restrictive licensing requirement on exports to China imposed in late May and June.

The restrictions on EDA software developers and ethane producers were just some of many countermeasures imposed by U.S. President Donald Trump's administration in response to China's export suspension of rare earths and related magnets in April.

Beijing's move on rare earths, part of retaliation against Trump's earlier tariffs this year, has upended supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors. The issue threatened to scupper a bilateral trade deal.

On Friday, China's commerce ministry said that following talks with the U.S., the two sides have confirmed a framework under which China will review export applications for controlled items while the U.S. will cancel corresponding restrictive measures.

"The U.S. have escalated to de-escalate. They put restrictions on many more items in order to get the Chinese to back off on rare earths," according to a source familiar with discussions inside the U.S. government.

"As the U.S. and China continue to hold to this framework agreement, we're gonna see a lot of these restrictions go away. Going back to a status quo, where we were at in Feb/March," said the source who was not authorised to speak to media and declined to be identified.

EDA RELIEF

Siemens said in a statement that it has resumed sales and support for Chinese customers after it was recently notified by the U.S. Department of Commerce that export control restrictions for customers in China were no longer in place.

Its shares rose 1.7% after market open on Thursday.

Synopsys expects to complete system updates to restore access and support to Chinese customers within three business days, according to a company letter to staff seen by Reuters.

The U.S. Department of Commerce did not immediately respond to Reuters' requests for comment.

Long-term restrictions on Chinese access to EDA software would have significantly hampered China's chip design industry. Synopsys, Cadence and Siemens command more than 70% of China's EDA market, Chinese state news agency Xinhua reported in April.

It was not immediately clear if other countermeasures imposed by the U.S. have been lifted. These include the suspension of licenses for GE Aerospace to ship jet engines for the C919 aircraft of Chinese airplane maker COMAC (CMAFC.UL) and for nuclear equipment suppliers to sell to Chinese power plants.

As trade war truce with China holds, US lifts curbs for chip design software and ethane | Reuters

US lets GE restart jet engine shipments to China’s COMAC, source says: Reuters

Published Thu, Jul 3 2025 10:07 PM EDT

The U.S. told GE Aerospace Thursday that it can restart jet engine shipments to China’s COMAC, according to a person familiar with the matter, in a further sign of de-escalating U.S.-Sino trade tensions that included concessions from Beijing over rare earths.

The United States this week also lifted restrictions on exports to China for chip design software developers and ethane producers, suggesting trade talks between the two countries are moving forward.

License suspensions and new license requirements on the different exports had been issued several weeks ago as part of the ongoing trade war between the world’s two biggest economies.

GE did not respond to an email request for comment, nor did the Commerce Department, which notified GE it could restart shipments.

Licenses for GE Aerospace affect engines sold to China’s state-owned aerospace manufacturer COMAC, which wants to compete internationally against dominant plane makers Airbus and Boeing.

A spokesperson for the Chinese embassy in Washington did not immediately respond to a request for comment.

The restrictions were among the many countermeasures imposed by U.S. President Donald Trump’s administration in response to China’s export restrictions on rare earths and related magnets in April.

Beijing’s move on rare earths, part of retaliation against Trump’s earlier tariffs this year, has upended supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors. The issue threatened to scupper a bilateral trade deal.

The license suspensions lifted for GE affect LEAP-1C engines to COMAC for its C919 single-aisle aircraft, and GE’s CF34 engine for COMAC’s C909 regional jet, according to the person familiar, who declined to be identified because they were not authorized to speak publicly.

The LEAP 1-C engines are the product of a joint venture between GE Aerospace and France’s Safran.

The C919 is made in China but many of its components come from overseas.

At least one other aerospace company also had its license suspensions for China lifted on Thursday, according to another person, who declined to identify the company.

Honeywell Aerospace has supplied COMAC’s C919, too, providing an auxiliary power system, wheels and brakes, flight control package, and navigation package. Honeywell did not return a request for comment.

More

US lets GE restart jet engine shipments to China's COMAC, source says: Reuters

In other news, tinned goods Del Monte 1.0 gets canned. Get ready for Del Monte 2.0 Lite.

Beloved grocery staple Del Monte Foods files for bankruptcy

2 July 2025

An American grocery staple just went bankrupt. Del Monte Foods, the 138-year-old company behind some of America's most recognizable pantry staples, has filed for Chapter 11 bankruptcy protection.

For decades, the company has produced canned fruits and vegetables for American grocery consumers. The food producer filed for bankruptcy protection late Tuesday night. Del Monte said it plans to sell itself as part of an agreement with key lenders and will continue normal operations during the process.

To keep things running, Del Monte secured $912.5 million in financing. Del Monte's portfolio extends beyond canned corn and peaches — it also shelves household names like College Inn, known for soup broth, and Joyba's bubble tea.

But shifting consumer habits have left the brand struggling to stay relevant, Sarah Foss, the head of legal and restructuring at Debtwire, told DailyMail.com. 'Del Monte says that consumer demand has declined causing it to incur increased costs related to surplus inventory,' she said.

'Consumer preferences have shifted away from preservative-laden canned food in favor of healthier alternatives.' The company, once a dominant force in US grocery aisles, now finds itself with between $1 billion and $10 billion in estimated assets and liabilities. Its filing lists up to 25,000 creditors.

'This is a strategic step forward for Del Monte Foods,' CEO Greg Longstreet (pictured) said. 'After a thorough evaluation of all available options, we determined a court-supervised sale process is the most effective way to accelerate our turnaround and create a stronger and enduring Del Monte Foods.'

The company said it will continue non-US grocery sales during the filing as well. Some of its global enterprises are not included in the court filing. It is the latest food-supplying company that has become insolvent, Foss added. 'Del Monte is the fourth company in the food and beverage sector to file for Chapter 11 this year, and the fifteenth since the beginning of 2024,' she said.

Earlier this year, Hearthside Foods emerged from its bankruptcy and rebranded as Maker's Pride. Harvest Sherwood Food Distributors also filed for Chapter 11 in May. Meanwhile, household names are reporting some headwinds.

Campbell's, the company behind the title-name soups and popular snacks from Pepperidge Farm, posted a profit of $66 billion in its latest earnings. The company said it saw a larger-than-expected boost in its low-cost soup sales. Meanwhile, it said consumers were cutting back on snack spending.

'Consumers are cooking at home at the highest levels since early 2020,' the food maker's CEO, Mick Beekhuizen, said during the earnings call. The company's meal growth and snack decline reflect how many Americans are responding to slumping consumer sentiment reports and higher costs in grocery stores.

Beloved grocery staple Del Monte Foods files for bankruptcy

Global Inflation/Stagflation/Recession Watch.

Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.

The only function of economic forecasting is to make astrology look respectable.

John Kenneth Galbraith

But yesterday’s BLS jobs report suggests the opposite. Who’s right, who’s wrong? Which will Fed Chairman Powell believe?

'Can anyone spell recession?' Trump slammed as jobs report stuns economists

July 2, 2025

Payrolls processing firm ADP reported private sector hiring contracted unexpectedly in June, with private payrolls losing 33,000 jobs.

The news came as a surprise because economists polled by Dow Jones in the weeks ahead of the ADP report had forecast an increase of 100,000 jobs for the month, despite growth in May being revised to just 29,000 jobs rather than 37,000.

The bulk of job losses happened in professional and business services and health and education, according to ADP, with the Midwest and Western regions seeing the strongest contractions.

Social media exploded at the news, partially because economists had predicted a more stable and robust economy weathering the impact of President Donald Trump’s incessant tariff threats.

“Can anyone spell RECESSION?” posted New York legislator Jon Cooper.

“This must be a huge problem for Joe Biden, right?” quipped YouTube host David Pakman, referring to Trump’s habit of blaming his predecessor for economic bumps in Trump’s economy.

Pakman pointed out that the job losses amounted to the first “in over two years,” while political analyst Marco Frieri demanded: “Is that what they call ‘Making America Great Again’?”

On the same day of the ADP report, Chamber of Progress Director Tahra Hoops noted Trump congratulating himself on the strong U.S. economy.

“THIS GROWTH has already begun at levels never seen before,” Trump declared on Truth Social, which prompted Hoops to wonder what world Trump was inhabiting.

“He lives in an alternate universe,” Hoops posted. “… It's clear employers are growing weary over Trump tariff impacts and just the continuing levels of uncertainty,” Hoops added.

Public Notice writer Aaron Rupar, meanwhile, noticed Trump’s allies at Fox news initially playing down or ignoring the bad news.

'Can anyone spell recession?' Trump slammed as jobs report stuns economists

Car making giant threatens factory closures due to EV sales pressures

3 July 2025

Another major car manufacturer has said it may be forced to close factories as the motor industry faces headwinds linked to mounting pressure to transition to electric vehicles.

Stellantis - the parent company of massive brands including Citroen, Fiat, Peugeot and Vauxhall to name just a few - said it may be forced to shutter vehicle plants due to the risk of hefty European Union fines levied for not complying with CO2 emission targets.

European head of the Franco-Italian auto maker Jean-Philippe Imparato says EU-based car manufacturers will must sell more EVs to cut CO2 emissions or risk penalties as part of the bloc's efforts to hit air pollution targets. 

It comes just months after the European motor sector successfully lobbied for more time to comply with rules, with fines to be based on 2025-2027 emissions rather than just in 2025.

However, Imparato says even these more relaxed targets are 'unreachable' for car makers and will expose his company to fines of up to €2.5billion (£2.15bn) within 'two-to-three years'.

Stellantis earlier this year closed Vauxhall's 100-year-old Luton van factory, putting 1,100 jobs at risk. When it announced the move in November, it partly attributed the decision to the UK Government's stringent EV sales targets. 

Speaking at a conference in the lower house of parliament in Rome on Tuesday, the former Alfa Romeo CEO (which is also owned by Stellantis) said that without significant changes in the regulatory situation by the end of this year, the company would 'have to make tough decisions'.

To achieve the targets set out by the EU, Stellantis either needs to double its electric vehicle sales - which Imparto said would be impossible - or cut the production of petrol and diesel cars to artificially increase its share of EV deliveries.

The latter would see internal combustion engine (ICE) cars rationed for customers at a time when many are not ready to commit to EVs and could hammer the manufacturer's sales volumes.

More

Car making giant threatens factory closures due to EV sales pressures

Covid-19 Corner

This section will continue only occasionally when something of interest occurs.

 

Technology Update.

With events happening fast in the development of solar power and graphene, among other things, I’ve added this section. Updates as they get reported.

HG goes green on cranes in £1.2m switch to battery power

3 July 2025

HG Construction is phasing out diesel generators on its tower cranes after pumping £1.2m into site battery systems in a major move to decarbonise its operations.

The contractor is rolling out UK-made Revolution Battery units from Dumarey Green Power across it sites, following a successful trial that saw costs and emissions slashed by over 90%.

The first wave of installations are in London at Canada Street Phase 2 and 55 West Ealing sites, alongside an already live unit at Trocoll House in Barking.

Further deployments are planned across upcoming jobs in the Midlands and North of England.

During trials, a single battery system powered two Moritsch RTL 195 luffing cranes from a 32A 3-phase mains supply – replacing two 200kVA diesel generators running up to 60 hours per week.

Trial savings

  • Weekly fuel bills slashed from £1,400 to £80 per crane
  • Emissions down from 3,000kg to under 200kg CO₂ per week
  • Smaller, quieter and more reliable than diesel units

HG chief executive Adam Quinn said: “The performance of the Revolution Battery during the trials was exceptional – reducing carbon emissions and running costs by over 90%. These results speak for themselves.”

He added the investment supports HG’s wider net-zero targets and commitment to buying from local suppliers wherever possible.

The Revolution Battery works differently to traditional BESS systems by decoupling energy storage from output power. That means fewer battery cells are needed, reducing weight, size, and embedded carbon. If mains power is not available, a 40kVA generator can charge the unit in under three hours daily.

HG goes green on cranes in £1.2m switch to battery power | Construction Enquirer News

Next, the world global debt clock. Nations debts to GDP compared.

World Debt Clocks (usdebtclock.org)

There can be few fields of human endeavor in which history counts for so little as in the world of finance. Past experience, to the extent that it is part of memory at all, is dismissed as the primitive refuge of the those who do not have insight to appreciate the incredible wonders of the present.

John Kenneth Galbraith

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