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Trump’s tariffs trigger global market downturn

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The market collapse, triggered by US President Donald Trump’s tariffs, deepened on Monday after the President signaled he would not back down from aggressive trade policies despite growing fears of a global recession.

Stocks fell sharply, while currencies rose and bond yields declined. Contracts tracking the S&P 500 fell by 3.2%, while those for the Nasdaq fell by 4.1%. Asian stocks were shaken, with Hong Kong’s Hang Seng index falling by more than 10%.

European stocks declined at the opening on Monday, with the Stoxx Europe 600 index falling by 6.2% and Germany’s Dax index falling by 10%. The index in Frankfurt fell by around 9%, while the share value of the German arms company Rheinmetall, whose shares soared with the war in Ukraine, is heading towards disaster with a 27% decrease.

The heavy declines came as Goldman Sachs raised its probability of the US entering a recession from 35% to 45% following “a sharp tightening in financial conditions” after Trump imposed sweeping tariffs on US trading partners last week.

Trump said on Truth Social on Sunday night, “We have large financial deficits with China, the European Union, and many other countries. The only way to solve this problem is with TARIFFS, which are now making the US Tens of Billions of Dollars… They are already in place and a beautiful thing to see.”

When Trump was asked by reporters about the market declines, he said, “Sometimes you have to take medicine in order to fix something.”

More than $5 trillion was erased from the S&P 500 index on Thursday and Friday, capping off the worst week for the index since the start of the coronavirus pandemic in 2020.

As markets fell, even supporters of the US President voiced concerns about the White House’s trade agenda. On Sunday, billionaire investor Bill Ackman wrote on X, “By imposing large and disproportionate tariffs on both our friends and our enemies… we are in the process of destroying confidence in our country as a trading partner.”

Ackman also attacked Commerce Secretary Howard Lutnick for being “indifferent to the collapse of the stock market and the economy,” claiming that Lutnick and his company, Cantor Fitzgerald, make money by holding fixed-income assets.

The price of safe-haven bonds, such as US Treasury bonds, had risen during the stock selloff over the past few days. Ackman said that Lutnick “profits when our economy collapses.”

Billionaire hedge fund investor Stanley Druckenmiller also expressed his opposition to Trump’s tariff regime, saying on X, “I am not in favor of tariffs over 10%.”

The benchmark 10-year US Treasury yield, closely watched by Trump administration officials, fell 0.08 percentage points to 3.91% on Monday as investors globally flocked to bonds.

Japan’s 10-year JGB yield fell 0.07 percentage points to 1.11%, while China’s 10-year yield fell 0.09 percentage points to 1.64%.

Two global banks based in London took a heavy hit. Shares of HSBC and Standard Chartered both fell about 16% in Hong Kong trading.

According to Bloomberg Intelligence, their exposure to emerging markets and recent strategic pivot to Asia makes these banks particularly vulnerable to a trade war.

Commodities also continued to suffer heavy losses, with West Texas Intermediate, the benchmark for US oil prices, falling 3.4% to $59.80 a barrel. International benchmark Brent crude fell 3.4% to $63.35.

LME copper, widely seen as a bellwether for growth due to its industrial use, fell more than 7% to $8,690 a ton. Bitcoin fell 0.8% to $78,198 a token.

The US dollar fell 0.3% against a basket of its largest trading partner currencies, while the Japanese yen rose 0.8% to 145.6 yen per dollar. Chinese authorities set the offshore renminbi at its weakest level since early December at 7.19 Rmb per dollar.

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Pentagon and Justice Department form joint task force to combat media leaks

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US Secretary of Defense Pete Hegseth announced on Monday that the Department of Defense and the Department of Justice have established a joint task force as part of efforts to prevent the unauthorized disclosure of sensitive information to the public.

Hegseth stated that the Office of the General Counsel (OGC) of the Department of Defense will have the authority to request and receive all information, support, and records across the Pentagon related to media leak investigations.

The Defense Secretary noted that all departments and personnel within the ministry will prioritize these requests. He added that a complete and comprehensive response to any instruction issued by the OGC under this authority must be provided within two days of the submission of the request.

“Leaked information risks lives. These new tools and processes will greatly assist us in protecting our collective strength. Our nation’s security cannot be a bargaining chip for those chasing instant headlines,” Hegseth said in an approximately two-and-a-half-minute video message published on the social media platform X.

Hegseth also stated, “Access to classified and confidential information is a sacred trust, and those who betray this trust will face the full force of the law.”

The announcement of the task force came a few days after the Department of Justice issued subpoenas to four New York Times reporters. The journalists, summoned to testify before a federal grand jury, had reported on security concerns regarding President Donald Trump’s flight to Türkiye for a NATO summit on an aircraft donated by Qatar.

The subpoenas drew sharp criticism from The New York Times and press freedom advocates. Opponents argue that the government is attempting to intimidate news organizations.

“Our journalists report the facts and defend the American public’s right to know how their government operates and how taxpayer dollars are spent,” New York Times attorney David McCraw said in a statement. “This brazen action is nothing less than an attempt to deter journalists from doing their jobs, thereby preventing the public from learning what is happening in the country.”

Hegseth has been taking steps to prevent leaks to the press since the beginning of his tenure at the Pentagon. Last year, the department launched investigations into personnel alleged to have leaked classified information to the media and threatened to administer polygraph tests.

Leak allegations were also directed at some of Hegseth’s advisers last year. Former senior adviser Dan Caldwell and former deputy chief of staff Darin Selnick are among those individuals. Caldwell, Selnick, and Colin Carroll, the former chief of staff to Deputy Secretary of Defense Stephen A. Feinberg, were first suspended and subsequently dismissed from their positions and removed from the Pentagon as part of the internal leak investigation.

A government official, speaking to The Hill in mid-March, stated there was no evidence that Caldwell, who began working at the Office of the Director of National Intelligence (ODNI) earlier this year, had leaked information from the Pentagon.

Defense Secretary Hegseth has previously been the target of criticism himself for allegedly sharing sensitive information. Last year, Hegseth discussed planned US strikes against the Houthis in Yemen in a Signal group chat to which an editor of The Atlantic magazine had been mistakenly added. A report published in December by the Pentagon’s Office of the Inspector General determined that Hegseth had compromised military security and violated department policy by using the Signal application on his personal mobile phone.

“It is highly ironic that Hegseth himself shared sensitive national defense information with his wife over Signal last year and faced no consequences, yet now speaks of the need to protect this information,” said former Pentagon spokesperson John Ullyot. “In 2012, CIA Director David Petraeus resigned from his post for a similar situation involving his girlfriend, and was sentenced in federal court to two years of probation and a $10,000 fine.”

Ullyot, who also served as the spokesperson for the National Security Council during Trump’s first term, told The Hill on Monday: “The President deserves better from his national security leaders. Hegseth should start holding himself accountable before holding others accountable.”

Reporters have been largely blocked from entering the Pentagon after Hegseth revoked access to most of the facility. Pentagon correspondents returned their press credentials in October, refusing to sign a new media policy that required a commitment not to solicit unauthorized materials.

Hegseth and his supporters argue that the policy will protect national security by preventing the leak of classified information. Press freedom groups and critics, conversely, characterize the practice as a violation of the constitutional rights of journalists.

Most recently, the department further restricted press access by declaring the Pentagon building a classified space and banning journalists from entering.

Offering historical references in his statement on Monday, Hegseth said, “Leaking sensitive national defense information and secrets is a betrayal of the men and women who wear the uniform of our country. This is a principle as old as the history of warfare, reaching back to the founding of our republic in the United States. George Washington himself combated leaks, insider threats, and espionage.”

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SpaceX shares fall 40% from peak to approach IPO floor as regulatory scrutiny weighs

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Shares of the American aerospace company SpaceX fell to as low as $136.78 at the trough of the trading session on Monday, July 13, representing a 5.87% decline compared to the close of trading on July 10. According to data from the US-based NASDAQ exchange, this retreat marks a depreciation of approximately 40% from the company’s historic peak of $225.64, which was recorded on June 16. With this latest decline, the company’s shares have approached their initial public offering (IPO) price threshold of $135.

As of 21:25 Moscow time on the trading day in question, the shares continued to trade at $137.4, down 5.4%.

The downward trend in the shares was driven by reports that the US Federal Aviation Administration (FAA) had concluded its investigation into the emergencies and malfunctions during the May 22 launch of Starship, the largest and most powerful rocket model developed by SpaceX.

According to CNBC, the agency reviewed and approved the findings and corrective measures submitted by the company following its internal investigation into the incident.

The Starship project, a massive, reusable rocket designed to carry crew and cargo to the Moon and Mars and to perform other space missions, is considered one of the most critical elements of Elon Musk’s space program.

In a statement issued by the FAA, it was noted that following the approved corrective actions, SpaceX is permitted to begin preparations for the Starship Flight 13 flight, provided that the company meets all safety requirements and licensing conditions.

The FAA had previously issued a statement regarding the malfunction during the launch attempt at the end of May. The statement noted: “The anomaly occurred during the Super Heavy booster’s flip maneuver over the Gulf of America.”

The region referred to as the Gulf of America by US authorities in official correspondence is commonly known as the Gulf of Mexico.

According to official data, the booster parts fell within the boundaries of pre-established hazard areas. Six flights were delayed and five aircraft remained in holding patterns for a period due to the incident, though no changes were made to flight routes.

SpaceX shares, which began trading on the NASDAQ exchange at the beginning of June, gained 25% at the opening. As part of the initial public offering, the company offered 555.6 million shares for sale at a fixed price of $135 per share.

The SpaceX IPO was recorded as the largest initial public offering in financial history. The company initially raised $75 billion, and the total funds raised reached $85.7 billion after consortium members exercised their over-allotment option to purchase an additional 83.3 million shares.

In a statement to his employees, company founder Elon Musk stated that going public was necessary to generate capital during a phase of rapid growth. It was announced that the proceeds would be used to complete the development process of the Starship rockets, bring them to commercial readiness, and expand the Starlink satellite network.

The post-IPO surge in SpaceX shares had briefly made Elon Musk the world’s first trillionaire. Bloomberg had estimated Musk’s wealth at $1.05 trillion, while Forbes valued it at $1.1 trillion.

However, with the decline in share prices and the company’s market value that began in late June, Musk lost his trillionaire title after holding it for 12 days.

According to an analysis by Bloomberg, the decline was driven by SpaceX’s preparations to issue at least $20 billion in bonds to finance artificial intelligence projects, alongside the signing of a multi-billion-dollar agreement with AI startup Reflection AI to provide computing resources.

Assessments by S&P Global projected that SpaceX will continue to incur expenditures without generating revenue until at least 2029.

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Trump notifies Congress of renewed war with Iran, resetting War Powers clock

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US President Donald Trump has formally notified lawmakers that the country is back at war with Iran, according to an official notification sent to Congress over the weekend.

In the letter dated July 10 and obtained by Politico, Trump stated that airstrikes beginning on July 7 constituted “military actions consistent with my responsibility to protect Americans and US interests both at home and abroad.”

The notification triggers a new 60-day statutory window under which the US administration can utilize military force in the region without prior congressional approval.

The conflict, which has repeatedly paused and restarted over control of the Strait of Hormuz—a crucial chokepoint for global energy supplies—has become a persistent challenge for the Trump administration.

Trump has expressed frustration over the failure to secure a peace agreement with Iran, while congressional Republicans remain concerned about being blamed for rising fuel prices ahead of the upcoming midterm elections.

On Monday, Trump intensified military pressure on Tehran, declaring that the US would reimpose a blockade on the region, seize control of the Strait of Hormuz, and levy fees on transiting vessels.

Ceasefire process officially ends

The notification to Congress follows Trump’s announcement that a two-month-old ceasefire with Iran has officially ended.

The ceasefire, originally declared in April, had been fragile from the outset due to reciprocal attacks by both nations. Despite the friction, the Trump administration had previously maintained that a full-scale war had not resumed.

Officials from US Central Command (CENTCOM) announced that US forces have struck more than 300 Iranian military targets over the past week in retaliation for Tehran’s hostile actions in the Strait of Hormuz.

On Monday, CENTCOM released a statement confirming that US forces had conducted additional airstrikes against Iran “at the direction of the Commander-in-Chief.”

“These strikes will continue to impose heavy costs on Iranian forces, degrading their capability to attack innocent civilians and commercial shipping in the Strait of Hormuz,” the statement read.

War powers debate

Trump had previously notified Congress that the war, which began in February, had “ended” in May, thereby resetting the 60-day statutory clock that would otherwise require the cessation of military operations without congressional authorization.

With the April ceasefire intended to run indefinitely, the White House argued that the timeline mandated by the War Powers Act had been paused.

However, anti-war lawmakers in Congress challenged this interpretation. They argued that the government was misapplying the law, noting that even when major combat operations subsided, the US Navy maintained its blockade to exert pressure on Tehran.

The new notification complicates ongoing efforts within Congress to limit military action against Iran. Last month, the Senate passed a symbolic resolution calling for an end to the hostilities, signaling waning support for Trump’s military campaign against Tehran.

The resolution, which passed 50 to 48 after four Republican senators voted with Democrats, sought to make congressional approval a requirement for continued military operations.

A similar measure had previously passed the House of Representatives by a vote of 215 to 208, also drawing the support of four Republicans.

The legislative impact of these measures remains limited, however, as joint resolutions are not sent to the president for signature, and any bill seeking to restrict executive war powers would face a certain White House veto.

In his letter to Congress, Trump emphasized that US military forces remain deployed to counter threats against allies.

“United States Armed Forces remain postured to take additional steps, as necessary and appropriate, to address further threats or attacks against the United States, its allies, or its partners, and to ensure that the Government of the Islamic Republic of Iran ceases to pose a threat to the United States and its partners,” Trump wrote.

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