Top News
US-South Korea deal leads flurry of Trump trade announcements
President Donald Trump announced a trade agreement with South Korea that includes blanket tariffs of 15 percent on exports to the US. Trump said the deal also involves a commitment by Seoul to invest US$350 billion in US businesses. The deal comes a day before Trump's August 1 deadline for concluding agreements with trading partners.
In a series of announcements Trump also imposed a 25 percent tariff on goods exported to the US by India, chastising New Delhi for failing to agree to open its market to US goods, and slapped a 50 percent tariff on most goods from Brazil for what he calls a legal "witch hunt" against former president and friend Jair Bolsonaro.
Trump doubled down on earlier warnings that he will slap 25 percent on imports from countries that trade with Russia if Moscow doesn't agree to a ceasefire in the Ukraine War. India and China are among the largest buyers of Russian gas and oil. He also slapped fresh sanctions on more than 115 companies and individuals linked to Iranian shipping, affecting maritime interests from Panama and Italy to Hong Kong.
Canada follows UK, France with Palestinian statehood plan
Canada became the third member of the Group of Seven major economies to announce recognition of a Palestinian state unless a ceasefire in Gaza is reached. It joins the UK and France, which made similar announcements this month. Already, 147 nations do recognize a state of Palestine comprising Gaza and the West Bank. The new pressure on Israel to commit to a two-state solution in the Middle East was precipitated by global outrage as mass starvation in Gaza.
China vows to pledge more economic support
China's Politburo on Wednesday pledged to "step up" economic support in the second half of 2025 amid internal and external challenges. The announcement followed a high-level meeting led by President Xi Jinping, where officials outlined priorities that included boosting consumption, supporting private investment and stabilizing foreign trade. The statement suggested further monetary easing may be on the horizon. The meeting came shortly after China and the US agreed in Stockholm to seek an extension of a 90-day truce on tariffs while they discuss a broad trade deal.
Russian earthquake activates tsunami alerts across the Pacific
An 8.8-magnitude, one of the strongest earthquakes ever recorded, struck off Russia's sparsely populated Far East coast early Wednesday, triggering tsunami alerts across the Pacific Ocean, from Japan to the western coasts of the Americas. Higher waves were reported in many locations, causing some property damage but no known deaths.
Top Business
China reiterates support for US business
China's top industry regulator reaffirmed its support for foreign firms during talks with the US-China Business Council in Beijing on Tuesday. Li Lecheng, Minister of the Industry and Information Technology (MIIT) met with senior executives from major US companies, including Apple, Thermo Fisher and Otis, to stress the government's commitment to maintaining an open, fair and transparent business environment, and to welcome further investment in China's industrial transformation.
HSBC announces share buyback after profit plunge
London-based HSBC, the world's seventh largest lender by assets, announced a US$3 billion share buyback after reporting that second-quarter pretax profit fell 29 percent to US$6.3 billion, attributed largely to losses on its stake in China's Bank of Communications and a 10 percent increase in operating costs. Chief Executive Georges Elhedery pointed to "structural challenges" in the global economy that have created market volatility.
China makes hefty investment in new child subsidies
China has allocated an initial budget of 90 billion yuan (US$12.4 billion) to fund its new subsidy program for families with young children. It's part of the nation's efforts to stem a decline in the birth rate. Under the program, parents with children three years and younger will receive 3,600 yuan a year. Analysts said the government will have to broaden related support, like affordable child care and paid parental leave, if it wants to encourage more people to have children.
Economy & Markets
Fed leaves rates unchanged as US GDP rises
The US Federal Reserve held fast against intense pressure from US President Donald Trump to lower interest rates and left monetary policy unchanged in the 4.25 percent-4.50 percent range. Fed Chairman Jerome Powell said it's too early to assess the impact Trump's rewriting of tariff and other trade policies will have on inflation.
Before the Fed meeting, the US Commerce Department reported that the US economy grew 3 percent in the second quarter, a stronger-than-expected result. Consumer spending rose 1.4 percent, while exports slipped 1.8 percent and imports plunged 30.3 percent. The personal consumption expenditures price index, a key Fed metric for determining inflation risk, gained 2.1 in the quarter, just above the central bank's 2 percent target.
IMF raises growth forecast for China
The International Monetary Fund raised its forecast for China growth this year to 4.8 percent from 4 percent, citing stronger-than-expected economic activity in the first half of the year. China reported gross domestic product in the first six months grew 5.3 percent from a year earlier. At the same time, the IMF increased its 2025 global growth forecast to 3 percent from 2.8 percent. That would be shy of 3.3 percent growth last year.
Evergrande faces stock market expulsion
Ailing Chinese property developer Evergrande may be ousted from the Hong Kong exchange next month after failing to restructure US$23 billion in offshore debt amid court liquidation proceedings. The company is the highest-profile victim of the mainland property crisis that it triggered in 2021 with a debt default. Shares in the company, which isn't listed on mainland exchanges, have been suspended since late January 2024. Hong Kong market regulations require a suspended company to resume trading within 18 months. Evergrande capitalization that topped HK$400 billion (US$51 billion) after its listing in 2009 had plunged to HK$2.2 billion when share trading was halted.
Corporate
LG Energy signs contact to supply batteries to Tesla
South Korea's LG Energy Solution, one of the world's largest battery makers for electric cars and other electronics, signed a US$4.3 billion deal for one of its factories in the US to supply Tesla with lithium ion phosphate batteries for energy storage systems, Reuters reported, citing people familiar with the matter. LG Energy confirmed the deal but didn't identify the buyer. Tesla's move would be a step away from relying on batteries imported from China amid a still unresolved tariff dispute with the US. Tesla officials said earlier this year they were trying to source batteries from suppliers outside of China. The company this week also announced a US$16.5 billion order for chipsets from South Korea's Samsung Electronics.
Fosun Pharma secures rights to Alzheimer's drug
Shanghai-based Fosun Pharmaceutical signed a deal to pay Hong Kong-based NeuCo United up to 150 million yuan (US$21 million) to secure the China market rights to NeuCo's innovative AR1001 drug, a therapy under development to delay the progress of Alzheimer's disease. The deal involves an upfront payment and "milestone" payments based on outcomes as the drugs moves from the laboratory to commercial sales. The deal also calls for Fosun to pay NeuCo a percentage of the drug's net annual sales during the 15 years following its release to the market.
Meta, Microsoft post strong earnings
US Tech titans Meta and Microsoft delivered stronger-than-expected quarterly earnings. Meta, which owns Facebook, a stake in OpenAI and other entities, said revenue in the second quarter surged 22 percent from a year earlier and it expects increased growth on AI-related businesses. Microsoft reported an 18 revenue increase in its first quarter ended June 30 on surging cloud-computing demand, and said it will increase capital spending to US$120 billion in the current fiscal year.