The latest Market Talks covering U.S. politics. Published exclusively on Dow Jones Newswires throughout the day.

0754 ET - Regardless of what comes of high-level negotiations to ease trade tensions, the world is likely to continue moving toward a more protectionist environment, reckons National Bank of Canada's Angelo Katsoras. And to navigate that, investors will need to consider geopolitical fault lines, government priorities and protectionist policies that can impede market access or lead to higher operating costs. "Assessing the willingness of governments to support key sectors has become a critical part of investment analysis," Katsoras says. That includes the indirect effects of tariffs and moves by major countries and regions to repatriate production. China's reduced access to American consumers could encourage its companies to export more products to elsewhere, exacerbating trade tensions, while smaller countries must strive to maintain access to larger nationals vital to their economic future, the analyst says. (robb.stewart@wsj.com; @RobbMStewart)

0746 ET - As the bulk of the retail sector reels from the recent U.S. tariff blitz, analysts at Citi see silver linings for Dollar Tree and Dollar General. Citi upgrades Dollar Tree to buy from neutral, saying that while roughly half of the discount retailer's products are subject to significantly higher tariffs, the tariff regime gives it cover to further expand price points to $1.50/$1.75 from $1.25. Dollar General, meanwhile, doesn't have the same tariff risk as most other retailer, with only about 10% of sales affected, and may benefit from consumers trading down, says Citi, which upgrades the stock to neutral from sell. Dollar Tree up 0.7% premarket to $68.02, Dollar General up 0.3% to $92.92. (colin.kellaher@wsj.com)

0743 ET - Apple won't be able to make iPhones in the U.S. and keep their price points anywhere close to the $1,000 mark that currently exists for U.S. customers, Wedbush analysts say in a research note. It would take an estimated 3 years and $30 billion to move just 10% of Apple's supply chain from Asia to the U.S., with major disruptions along the way, the analysts say. "If consumers want a $3,500 iPhone, we should make them in New Jersey or Texas or another state," they say. "The concept of making iPhones in the U.S. is a non-starter in our view at $1,000." The analysts say it's hard to comprehend how dramatically onshoring production would hike iPhone prices and that the near-term impact on gross margin from President Trump's tariff war "could be mind boggling." (dean.seal@wsj.com)

0732 ET - With most product sourced in Asia, apparel companies will be hard hit by the sweeping new U.S. tariff plan, say analysts at Citi, who cut their price targets and FY25-26 earnings estimates for Colombia Sportswear, Levi Strauss, Oxford Industries, PVH, Ralph Lauren and VF Corp. Citi says it doesn't think the apparel makers have enough pricing power to offset an assumed 30% blended tariff rate, and that attempts to raise prices will generally result in weaker demand. Citi downgrades VF to neutral from buy, citing concerns about the company's ability to turn its Vans brand around in the current environment. VF down 4.8% premarket to $11. (colin.kellaher@wsj.com)

0727 ET - Gold futures rise in volatile trading. Futures are up 0.7% at $3,056.50 a troy ounce, having traded as high as $3,084.40/oz and as low as $2,985/oz earlier in the session. The precious metal has seen significant swings as traders and funds are forced to liquidate holdings to meet margin calls elsewhere in the market, SP Angel analysts say in a note. The Trump administration is holding firm on its tariff position despite widespread market turmoil. While it is normal for gold to fall in the event of a market collapse, it is always the first instrument to rebound as investors move out of stocks, SP Angel says. Gold will prove to be the go-to store of value as investors work out which currencies and jurisdictions to move their funds to, analysts add. (joseph.hoppe@wsj.com)

0714 ET - Tesla and Apple will be among the top U.S. companies most badly damaged by President Trump's tariff campaign, Wedbush analysts say in a pair of research notes. For Tesla, the resulting trade war is a double whammy, they say. The EV maker gets plenty of parts and batteries from sources overseas, so costs will go up, sending prices higher and eroding demand, the analysts say. China is also a key region for Tesla, and Trump's tariffs have created a backlash against Elon Musk there that will drive customers to BYD and other Chinese competitors, they say. Apple meanwhile relies on China for 90% of its iPhone production, so a 54% tariff of Chinese imports, along with a 32% levy on imports from Taiwan, would be devastating to Apple's cost structure, the analysts say. Tesla is off 4% premarket and Apple sinks 3%.(dean.seal@wsj.com)

0707 ET - Jamie Dimon warns that fraying military and economic alliances in the Western world would lead to a weaker U.S. over time. "Keeping our alliances together, both militarily and economically, is essential," he says in annual shareholder letter. "The opposite is precisely what our adversaries want." He says fragmentation in Europe would create a landscape much like the one right before World War II, with each nation needing to seek out its own relationships. This could result in closer ties to countries like Russian and Iran for energy and China for trade, essentially creating vassal states. "Economics is the longtime glue and America First is fine, as long as it doesn't end up being America alone." (paul.ziobro@wsj.com)

0645 ET - Capgemini might be affected by U.S. tariffs, UBS analysts write in a note. The French consulting and technology group generated 28% of its sales from North America last year and the impact of U.S. federal actions and regulations is negligible, the analysts say. However, the company serves many industrial customers in the U.S. and elsewhere that might be affected by tariffs, they say. "Group-wide 27% of sales last year came from manufacturing, with around 8% each in automotive and aerospace," they say. The Swiss bank expects a 2.7% organic decline in sales for the first quarter and a 1.9% decline for the first half before a return to growth in second half. Share fall 4.8% to 122.15 euros. (najat.kantouar@wsj.com)

0645 ET - While equity markets are oversold and could bounce on positive tariff headlines, fundamentals suggest there could be more downside, Barclays analysts say in a note. Valuations, earnings and positioning are still far from capitulation zone, the bank notes. "We think global equities are unlikely to go back to recent highs anytime soon, as much damage has been done," it says. Meanwhile, as the U.S. loses some of its unique strengths and dominance, Europe could have a chance to step up, it adds. Barclays has cut its year-end target for Europe's Stoxx 600 index to 490, noting it could fall potentially to around 390 in the event of a prolonged recession, or rebound to 550 if the trade war de-escalates quickly enough. The Stoxx 600 falls 4.2% to 475.62.(maitane.sardon@wsj.com)

0617 ET - Europe cementing a trade deal with South America would send a strong signal on free trade and offer a boost to European exporters, Spanish trade and finance minister Carlos Cuerpo says. EU trade ministers are meeting Monday to discuss the bloc's response to U.S. President Trump's package of steep trade tariffs, which have roiled markets and threaten to depress European economic growth. Part of Europe's response should be to ratify a free-trade deal with Mercosur, a grouping of South American economies, Cuerpo says. "The EU must send a strong signal that it is a reliable partner, open for business with the rest of the world," he says. A trade deal with Mercosur would support sectors likely to be affected by growing global protectionism, such as Spain's wine and olive-oil producers, Cuerpo says in a post on X. (joshua.kirby@wsj.com; @joshualeokirby)

0614 ET - The cost of insuring U.S. sovereign debt against default using credit default swaps rises as fears grow that the country could slip into a recession following last week's tariff announcements. There is now a 60% chance of a U.S. recession, according to JPMorgan, up from 40% probability prior to last week's U.S. tariffs announcement. The U.S. 5-year CDS spread climbs 1 basis point to 46bps, a nearly 6-month high, S&P Global Market Intelligence data show. The U.S. 1-year credit default swap spread rises 1bp to 49bps, a 5-month high. (miriam.mukuru@wsj.com)

0553 ET - Eurozone purse strings are loosening but could be tightened again as Washington's tariffs threaten to squeeze consumers in the currency area, Capital Economics' Ankita Amajuri says. Retail sales rose for the first time in months in February, pointing to a recovery among eurozone shoppers as inflation eases. Consumer spending should continue to grow at a modest pace over the coming months, Amajuri says. But that rebound could stall as trade tariffs take their toll, she says. "Unless some of them are reversed, the hit to activity and confidence mean that spending growth could be weaker than the quarterly average of 0.3% on quarter that we are currently forecasting," Amajuri says in a note. (joshua.kirby@wsj.com; @joshualeokirby)

(END) Dow Jones Newswires

April 07, 2025 07:54 ET (11:54 GMT)

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