Tariffs are just one weapon in a trade war

Trade barriers can come in many forms. Tariffs are just one. Onerous licensing requirements, export restrictions and fines on shipping are other obstacles.

Nvidia said Tuesday it would be taking a $5.5 billion charge related to canceled chip exports to China because of new licensing rules from the U.S. government. Beijing has retaliated to Trump tariffs by implementing export restrictions on rare earth elements — integral to many electronics and defense technologies — to the United States. Donald Trump’s administration has been floating the idea of imposing levies on Chinese-made containerships calling at U.S. ports.

Given those developments, the World Trade Organization warned on Wednesday that the outlook for global trade has “deteriorated sharply,” and forecast a 0.2% decline in 2025. It’s not mere fearmongering: Shipping vessels originating from China are already canceling their journeys.

Trade, in another context, also occurs on the stock market — which has seen heightened volatility since U.S. President Donald Trump’s tariff onslaught. U.S. stocks fell Wednesday as trade war fears keep investors jittery.

Markets rocked by renewed trade jitters
U.S. stocks slumped Wednesday. The S&P 500 lost 2.24% and the Dow Jones Industrial Average fell 1.73%. The Nasdaq Composite sank 3.07%, weighed down by heavy declines in chip stocks amid reports of new U.S. licensing requirements for Nvidia exports. The pan-European Stoxx 600 index slipped 0.19%. Shares of ASML tumbled 5.2% after the Dutch company said Wednesday it fell short of first-quarter net bookings expectations, suggesting a slowdown in demand for its critical chipmaking machines.

Tension in dual mandate
U.S. Federal Reserve Chair Jerome Powell on Wednesday expressed concern that the central bank “may find ourselves in the challenging scenario in which our dual-mandate goals are in tension.” The Fed aims to ensure stable prices and full employment. Economists, including those at the Fed, see threats to both goals from Trump tariffs, which are “likely to move us further away from our goals,” Powell said in a question-and-answer session.

WTO warns of world trade disorganization
“The outlook for global trade has deteriorated sharply due to a surge in tariffs and trade policy uncertainty,” the World Trade Organization warned in its latest “Global Trade Outlook and Statistics” report out Wednesday. Based on the tariffs currently in place, and including a 90-day suspension of “reciprocal tariffs,” the volume of world merchandise trade is now expected to decline by 0.2% in 2025.

Freight ships from China canceling trips
U.S. importers are being notified of an increase in canceled sailings by freight ships out of China: A total of 80 blank, or canceled, sailings out of China have been recorded by freight company HLS Group. The impact of the diminished freight container traffic to North America will be significant for many links in the economy and supply chain, including the ports and logistics companies moving the freight.

OpenAI eyes ‘vibe coding’ tool Windsurf
OpenAI is in talks to pay about $3 billion to acquire Windsurf, an artificial intelligence tool for coding help, CNBC has confirmed. Should a deal take place with Windsurf, it would be by far OpenAI’s biggest acquisition. Windsurf is among the tools, alongside Cursor and Replit, that developers have flocked to in recent months to “vibe code,” a term that refers to having AI models quickly assemble code for new software.

[PRO] Still confident on dollar: Piper Sandler
The dollar index, which measures the greenback against a basket of major currencies, fell last week to its lowest point since April 2022 amid heightened uncertainty from Trump tariffs. More alarmingly, the U.S. dollar is typically viewed as a safe-haven asset in times of volatility, so its weakening has raised concerns. Piper Sandler, however, is still confident on the currency — here’s why.

Wall Street trading desks are feasting on the volatility from Trump’s global upheaval

Wall Street banks just posted their biggest-ever haul from stock trading as the opening months of Trump’s tenure led to upheavals across asset classes, as institutional investors around the world position themselves for a new regime.

Goldman Sachs, Morgan Stanley, JPMorgan Chase and Bank of America each notched record equities trading revenue in the first quarter, with the first three generating roughly $4 billion in revenue apiece.

Trump’s second time in office was supposed to be good for Wall Street’s dealmakers, the investment bankers handling billion-dollar acquisitions and high-profile IPO listings. Instead, deal activity has remained tepid, and the biggest beneficiaries so far have been sitting on bank’s trading floors.