US: BRAZIL: Lula Says Brazil Will Reciprocate US Tariffs If They Take Effect
Jul-11 15:46
Brazilian President Luiz Inácio Lula da Silva has pushed back on the 50% tariff rate US President Donald Trump threatened to impose on Brazil on August 1, saying “Trump is misinformed, US does not run a trade deficit with Brazil,” per Reuters.
- Lula adds that he “will fight for US tariffs on Brazil not to take effect… But if US tariffs take effect, we will reciprocate.” Lula's comments echo a July 10 statement on X: “Brazil is a sovereign nation with independent institutions and will not accept any form of tutelage.” Lula added: “…any unilateral tariff increases will be addressed in accordance with Brazil's Economic Reciprocity Law.”
- While Trump’s tariff letter to Brazil touches on a trade deficit, it breaks the template of other tariff letters by focusing on domestic political grievances that offer no clear pathway to resolution. Trump cites the Brazilian Supreme Court's handling of the prosecution of former President Jair Bolsonaro and a decision to impose fines on US social media firms as justification for tariffs.
- WSJ notes that Trump has “expanded his use of punitive duties over matters that have nothing to do with trade, breaking with more than a half-century of global economic precedent.”
- A short time ago, Trump told reporters of Lula: "Maybe at some point I'll talk to him, now I'm not," reiterating his claim: "They're treating President Bolsonaro very badly, he's a good man." See: TARIFFS: Trump Offers Few Clues On Tariffs But Teases Russia Sanctions
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US STOCKS: Midday Equities Roundup: Cautiously Firmer, Off Post-CPI Highs
Jun-11 15:40
- Stocks cling to mild/moderately higher levels ahead midday Wednesday, off post-CPI data highs amid cautious optimism after several US/China trade related headlines aired this morning.
- The main topic of the talks concluded late Tuesday -- were not the imposition of tariffs that has dominated the global news and economic cycle for the past two months, but Chinese export controls on rare earth metals that are crucial for US supply chains and US restrictions on the export of semiconductors and other related technologies linked to artificial intelligence (AI) to China.
- Currently, the DJIA trades up 170.13 points (0.4%) at 43046.38, S&P E-Minis up 11.75 points (0.19%) at 6057.75, Nasdaq up 49.3 points (0.3%) at 19766.81.
- Information Technology and Health Care sectors primarily led gainers in the first half, while Materials, Consumer Staples and Communication Services sectors underperformed.
- Leading gainers included: Palantir Technologies +3.40%, Super Micro Computer +3.03%, Broadcom +2.95% and Moderna +2.46%. Separately, Starbucks +3.08%, GE Vernova +2.74%, General Motors +2.66% and Warner Bros Discovery +2.35%.
- Laggers included Lockheed Martin -5.71%, Nucor -5.18%, Intel -4.69%, PG&E -3.52%, Constellation Brands -2.86% and Best Buy Co -2.40%. Separately, airlines traded weaker with United Airlines -2.36% and Delta Air Lines -2.11%.
OPTIONS: Larger FX Option Pipeline
Jun-11 15:34
- EUR/USD: Jun13 $1.1400-05(E1.7bln), $1.1485-00(E2.0bln); Jun16 $1.1400(E1.3bln), $1.1450-65(E1.5bln), $1.1500(E1.5bln)
- USD/JPY: Jun13 Y144.00($1.2bln); Jun16 Y145.00($4.4bln)
FED: US TSY 17W BILL AUCTION: HIGH 4.220%(ALLOT 22.92%)
Jun-11 15:32
- US TSY 17W BILL AUCTION: HIGH 4.220%(ALLOT 22.92%)
- US TSY 17W BILL AUCTION: DEALERS TAKE 32.60% OF COMPETITIVES
- US TSY 17W BILL AUCTION: DIRECTS TAKE 5.12% OF COMPETITIVES
- US TSY 17W BILL AUCTION: INDIRECTS TAKE 62.28% OF COMPETITIVES
- US TSY 17W BILL AUCTION: BID/CVR 2.96
