Before the bell: Countdown to 10:00 p.m. CET for U.S. Tariff Announcement

Industry picking up in China and Europe, slowing in the U.S. Markets rebound after a weak stretch.

Initially, the new U.S. import tariffs were scheduled to be announced tonight at 9:00 p.m. CET. Yesterday, it was decided to postpone the announcement to 10:00 p.m. to avoid disrupting Wall Street trading. Just how nervous are investors? Judging by yesterday’s market action, not very—at least not in Europe, where the DAX gained 1.7% and the Euro Stoxx 600 added 1.1%. The White House did confirm that the tariffs will take effect immediately, although the fragmented communication isn’t exactly confidence-inspiring. Today’s trading session is likely to be marked by caution. The S&P 500 swung between gains and losses, eventually closing up 0.38%. Johnson & Johnson dropped 7% as fears mount that a 9 billion dollar settlement over alleged harm from talc powder may not be enough. Business confidence data for March were published recently in China, the U.S., and Europe. While China and Europe showed improvement, the U.S. manufacturing PMI dropped to 49 points—worse than expected and signaling a decline in activity. If Trump chooses to go on the offensive tonight, he can’t claim he wasn’t warned.

Greenyard was suspended from trading yesterday; we await a press release. Another suspended stock, Ekopak, announced this morning it is cautiously removing revenue from its large “Waterkracht” project from its 2024 figures. In Asia, markets remain close to flat as investors count down to 10:00 p.m. for the White House announcement.

Another Big Test for Tesla

Tesla’s sales in Europe have been dismal this year. For example, Belgian sales have plummeted by 70%. Later today, Tesla will report global delivery figures for the first quarter. Analysts remain surprisingly optimistic, forecasting a 3.6% decline. Part of the weak sales stems from customers holding out for an update to the Model Y. But in the U.S., Tesla is also losing favor due to growing opposition to Elon Musk. Interestingly, the stock rose 3.6% yesterday. Perhaps that’s due to the sharp previous decline—or perhaps because some investors still see long-term value in Tesla’s data and self-driving technologies. Our take? Best to steer clear of the stock for now.

Melexis and X-Fab in the Same Boat?

The automotive sector has taken heavy hits in recent weeks, especially due to the 25% import tariffs on cars not produced in the U.S. It’s still unclear whether small components will be subject to the tariff as well. Logically, they shouldn’t be—doing so would punish automakers who manufacture vehicles in the U.S. But if we look at the share prices of Melexis and X-Fab, it seems likely. Since the start of the year, Melexis has lost 5.4% and its sibling company X-Fab is down 2.4%. X-Fab, as a manufacturer, has more volatile results due to higher fixed costs. Françoise Chombar recently noted that all chips are officially labeled as having “Asian origin.” Since X-Fab is Melexis’s main supplier, it would be indirectly affected. However, X-Fab also serves other clients and even owns a factory in Texas. Over a full cycle, both Melexis and X-Fab are heavily undervalued.

Did you know…

that Trump is reportedly advocating for a universal import tax of 20% on all countries—perhaps with an exception for Israel, which yesterday eliminated all import duties on U.S. goods?

This article was translated from Dutch and was originally published on Spaarvarkens.be.