- PoliticsReuters Videos
Trump on growth: tariffs are the answer, but I won't run the Fed
STORY: Donald Trump isn’t about to change course on economic policies - including a pledge to hit many imports with big tariffs. “It's going to have a massive effect, positive effect. It's going to be a positive.”The Republican presidential candidate was grilled Tuesday night in Chicago by Bloomberg Editor-in-Chief John Micklethwait. And it was a more combative encounter than interviews Trump has done with friendlier outfits like Fox News.“Your plans would add $7.5 trillion to the debt. That's more than twice the total for Vice President Harris. You are on course to push up debt up to 150% of GDP. This is a very businesslike audience, yeah. Why should they trust you with that?”“Because we're about growth. She's got no growth whatsoever. And we're all about growth. We're going to bring companies back to our country.”Trump went on to say ‘tariff’ was the most beautiful word in the dictionary. He said his plans to levy them would bring jobs back to the U.S., and raise enough money to keep public debts under control. The protectionist policy has been condemned by many economists, who argue it would actually cut jobs, drive up prices and alienate key allies. But Trump says countries like Mexico and Germany, both of which he has threatened with tariffs, have a simple remedy available: “All you have to do is build your plant in the United States and you don't have any tariffs.”Trump did appear to back away from previous suggestions he should control the Federal Reserve. But he said he should have the right to say whether rates should go up or down. And he didn’t answer when asked if he would reappoint current Fed Chair Jerome Powell.
- BusinessReuters Videos
Wall Street ends lower as chip, oil stocks drop
STORY: Wall Street's main indexes closed lower on Tuesday, as chip stocks tumbled and the energy sector slid along with oil prices.The Dow and S&P 500 each shed three-quarters of a percent, and the Nasdaq dropped one percent.The energy index finished down 3% for its biggest one-day percentage decline since early October 2023 as crude prices fell on weaker demand expectations.Still, Cole Smead, chief executive officer and portfolio manager at Smead Capital Management, sees the sector as a stronghold."If you look at CapEx as a percentage of operating cash flow, the history of the energy businesses is they always drill too much. It was kind of the old 'drill baby drill,' for lack of a better term. And what they've transformed into is now they're investing vehicles. They are companies that produce high levels of free cash flow. They don't drill like they did in the past. And when you track drilling, drilling was what they call CapEx. So when you track CapEx as a percentage of operating cash flow, you'll find it's gone to very low levels. And what that's done is it unleashes the free cash flow."In other movers, chip-equipment-maker ASML Holdings' U.S.-listed shares tumbled 16% after reporting downbeat expectations for 2025 sales. That helped drag down the Philadelphia semiconductor index 5.3% for its biggest one-day drop since early September.And fresh from a record-high close on Monday, shares of Nvidia fell more than 4.5% after a media report said the Biden administration is considering capping AI chip exports by U.S. companies.Switching to retail, shares of Walgreens Boots Alliance rallied nearly 16% after the pharmacy company narrowly beat Wall Street's lowered estimates for fourth-quarter adjusted profit and announced plans to shut 1,200 stores to cut costs.
- BusinessReuters Videos
Portfolio manager sees 'ripe environment' for bank stocks
STORY: Wall Street's biggest banks reported rising investment banking fees in the third quarter fueled by more deals and corporate debt issuance, and said their pipeline of new activity looked healthy, although some areas are slower to rebound.Buoyant stock markets and increased expectations of a soft U.S. economic landing are boosting banker confidence the year will finish on a high, executives said."Banking's a very ripe environment," said Smead. "The economy is going to be really good," said Smead, adding that a strong U.S. economy was "setting up an environment where if you're a bank, you're going to have trouble finding a recession that would hurt your lending in the interim or hurt your own loss provisions and that's causing banking to be a fabulously good business."
