Summary
AP market report on the day after Trump’s Japan deal announcement. S&P 500 +0.8%, Nikkei +3.5%. The piece includes Goldman Sachs economist David Mericle noting tariff passthrough to consumer prices was “tracking somewhat lower than in 2019” — suggesting less tariff-driven inflation than feared.
Key Points
- S&P 500 hit new all-time high; Dow +507 pts; Nikkei +3.5%
- 15% tariff on Japan imports (down from threatened 25%) celebrated by markets
- Goldman’s Mericle: tariff passthrough to consumer prices “tracking somewhat lower than in 2019”
- Hasbro: $1B non-cash hit to write down assets; expects cost ramp in current quarter
- Texas Instruments: cautious on tariff demand uncertainty; stock -13.3%
- GE Vernova: tariff inflation “trending toward lower end” of $300-400M expected range
- Meme stock activity: Krispy Kreme +39% intraday; gave most back
- Brian Jacobsen (Annex Wealth Management): “It’s a sign of the times that markets would cheer 15% tariffs. A year ago, that level of tariffs would be shocking.”
Newsletter Angles
- The “markets cheer 15% tariffs” quote perfectly captures the normalization dynamic
- The Goldman Sachs passthrough data (lower than expected) is the bullish counterpoint to the inflation narrative — worth engaging for balance
Concepts Mentioned
- Tariff-Driven Inflation — Goldman data suggesting less passthrough than feared
- Trade War Currency Dynamics — deal dynamics showing trade war resolution mechanics
Notes
AP sourcing. The Mericle quote on passthrough is the most analytically interesting element.