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Scott Bessent advises countries not to retaliate to Trump’s tariffs. (00:22) RH warns of economic challenges, sets FY25 sales guidance below street view. (02:31) Japan’s Mitsubishi (OTCPK:MSBHF) unveils growth plans, to invest $27 billion over next 3 years. (03:44)
When you go to Seeking Alpha you see a host of articles all about tariffs. I’ll give you a couple of examples: China firmly opposes new U.S. tariffs, vows retaliation; EU indicates strong plans to counter U.S. tariffs if negotiations fail.
These nations are responding but U.S. Treasury Secretary Scott Bessent is advising all countries, “Do not retaliate” after President Donald Trump announced sweeping tariffs on most countries.
Bessent told Fox News that the countries should, “Sit back, take it in, let’s see how it goes. Because if you retaliate, there will be escalation. If you don’t retaliate, this is the high-water mark.”
Apart from the baseline 10% tariff on all imports, Trump unveiled tariff rates of 34% on China (in addition to the existing 20% levy) and 32% on Taiwan. Tariff rates declared on U.S. allies – 25% on South Korea, 24% on Japan, and 20% on the European Union.
U.S. top trading partners Canada and Mexico were excluded from the 10% baseline tariff. The existing tariffs of up to 25% on imports not compliant with the USMCA deal remain in place.
While Ukraine is on the tariff list, Russia and Belarus are not. Bessent said this is because the U.S. doesn’t trade with these sanctioned countries. But government data showed that U.S. total goods trade with Russia was an estimated $3.5B in 2024.
I’ve linked the complete list of U.S. tariff rates and the countries targeted. It’s in the show notes section of the podcast.
A few other notable headlines related to tariffs:
Shares of RH (NYSE:RH) are down significantly premarket. The home furnishings retailer warned that the ongoing economic challenges and sluggish housing market would necessitate a delay to some of its new collections and set Q1 and FY25 revenue expectations below Wall Street’s estimates.
Along with a miss on Q4 profit and sales, the company also noted the challenges it will face this year, including the uncertainty surrounding tariffs, market volatility, inflation risk, and “the worst housing market in almost 50 years.” And because of $2.2B in stock repurchases conducted during the year, RH (NYSE:RH) acknowledged that it ended the year with “meaningful debt.”
In the reported quarter, RH (RH) missed on both the top- and bottom-line, earning an adjusted profit of $1.58 per share, up from $0.72 a year ago, but 33 cents less than anticipated. Total revenue improved by 10% to $812.4M, but was also below expectations.
RH is down 27% in premarket action.
Mitsubishi (OTCPK:MSBHF) plans to invest at least 4 trillion yen ($27 billion) over the next three years, aimed at boosting net profit to 1.2 trillion yen in the 2027/28 financial year.
Mitsubishi also said it would maintain its basic policy of progressive dividends and flexible share buybacks, including a plan to buy back up to 1 trillion yen of its own shares from April 4 to March 31, 2026.
Over the three-year period, Mitsubishi plans to allocate about 1 trillion yen to sustaining capital expenditure and more than 3 trillion to growth investments.
Warren Buffett’s Berkshire Hathaway (BRK.B) (BRK.A), which has a 9.67% stake, is the company’s largest shareholder.
What’s Trending on Seeking Alpha:
WW International in talks to restructure debt, handing control to bondholders
Meta’s Zuckerberg lobbying President Trump to escape upcoming FTC trial – WSJ
Newsmax stock loses steam and gives up gains from post-IPO excitement
Now let’s take a look at the markets ahead of the opening bell. Dow, S&P and Nasdaq futures are in the red. Crude oil is down 4.3% at $68/barrel. Bitcoin is down 1.5% at $83,000. Gold is down 1.3% at $3,120.
In the world markets, the FTSE 100 is down 1.3% and the DAX is down 1.5%.
The biggest movers for the day premarket: Diageo (NYSE:DEO) +4% – Shares climbed as analysts viewed the U.S. tariff announcement as avoiding the worst-case scenario for the spirits industry.
On today’s economic calendar:
Editor’s Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.
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