H&M reports first-quarter sales below expectations, indicating a sluggish start to the year
On Thursday, H&M revealed that its first-quarter sales fell short of expectations, signaling a slow beginning to the year for the second-largest clothing retailer in the world.
The Swedish fashion powerhouse saw a 2% increase in local currency sales, totaling 55.33 billion Swedish krona ($5.5 billion) during the three-month span, which was slightly less than the 55.86 billion anticipated by LSEG analysts.
Operating profit was 1.2 billion Swedish krona for the first quarter, compared to the expected 1.9 billion.
Read the full story here
— Karen Gilchrist
Trump warns of ‘much larger’ tariffs if EU and Canada collaborate to harm U.S. economy
U.S. President Donald Trump has issued a warning about imposing “much larger” tariffs on the European Union (EU) and Canada should they join forces to undermine U.S. trade interests.
“If the European Union collaborates with Canada to inflict economic damage on the USA, significant Tariffs, much larger than currently proposed, will be levied against both to safeguard the best friend each of those countries has ever known!” Trump stated in an update on Truth Social on Thursday.
On Wednesday, Trump announced a forthcoming 25% tariff on “all cars not produced in the United States,” with these tariffs set to take effect on April 2.
Trump White House assistant Will Scharf mentioned that these new tariffs will apply to “imports of cars and light trucks” and will be in addition to existing tariffs. He projected that these measures might generate “over $100 billion of new annual revenue” for the U.S.
Read the full story here
— Holly Ellyatt
Barclays reports rising average tariff rates
Though it remains uncertain whether President Trump will ease his stance on tariffs as he has implied, Barclays indicates that the trend of increasing average tariff rates is evident.
“It is clear that the trajectory is upwards: average tariff rates are on the rise, likely reaching levels not seen since before World War II,” wrote Michael McLean of Barclays on Wednesday.
“By the end of 2024, the U.S. weighted average tariff rate was estimated to be 2.5%. Following Trump’s current tariffs, this rate has surged more than threefold to exceed 8%,” he elaborated. “We predict that by the time Trump concludes his tariffs, it might reach as high as 15%.”
— Sarah Min
UBS outlines three reasons to prefer U.S. AI companies over those in China
In a recent report, UBS has presented three strong arguments for why investors should focus on U.S. artificial intelligence firms rather than their Chinese counterparts.
“Uncertainties linger among AI investors, primarily revolving around concerns that low-cost models from Chinese AI developers may overshadow U.S. competitors that have higher sunk costs,” noted Mark Haefele, chief investment officer of UBS Global Wealth Management. “Although both the U.S. and China have made substantial progress in AI, we believe there are compelling reasons to support U.S. AI firms over those in China, particularly in the near future.”
Haefele pointed out that significant capital expenditures from U.S. companies will likely create a competitive advantage.
“The intensity of capital expenditures in the U.S., defined as capex spending relative to revenues, is projected to be 20% in 2025, compared to China’s 11.7%. This difference underscores the U.S.’s commitment to maintaining a technological lead, despite potential increased depreciation costs in the short run,” he explained.
Moreover, heightened research and development investment from U.S. AI companies positions them to uncover “the next big innovation.” Additionally, Haefele emphasized that U.S. firms possess a “distinct edge” in monetization potential, indicating a higher likelihood of generating revenue and profits.
— Lisa Kailai Han
European markets: Opening projections
European markets are anticipated to open significantly lower on Thursday as the global markets respond to the new automotive tariffs announced by U.S. President Donald Trump.
The U.K.’s FTSE 100 index is predicted to drop by 25 points to 8,665, Germany’s DAX is expected to fall by 159 points to 22,685, France’s CAC forecasted to be down by 35 points to 7,991, and Italy’s FTSE MIB is expected to decrease by 188 points to 38,152, based on data from IG.
The day’s earnings will include reports from H&M and Next, while data releases will consist of final U.S. fourth-quarter gross domestic product metrics and figures for business confidence in Spain.
— Holly Ellyatt
