This news package covers a variety of topics including Trump's temporary pause on tariffs, Alphabet and AMD's disappointing earnings reports, potential merger talks between Honda and Nissan, Elon Musk's Tesla stock surge, and the Federal Reserve's dilemma in the face of potential tariff-driven inflation. It also includes a brief mention of a recent jet crash in Philadelphia.
U.S. President Donald Trump on Monday paused tariffs on Mexico and Canada, but notably, not China, and in doing so, also stemmed the dip in stocks, at least for now. Major U.S. benchmarks snapped a two-day losing streak in a relief rally. With the temporary respite in U.S. tariffs on key countries, investors could turn their attention to earnings. But what they saw on Tuesday wasn't likely to comfort them after the turmoil wreaked by tariffs.
Alphabet's scorecard for its fourth-quarter performance missed the 'A' grade so many expect from Big Tech names. Meanwhile, AMD's data center sales, a key part of its business, missed estimates. Investor disappointment was immediate: Shares of both companies slumped in extended trading, signaling that corporate fundamentals remain critical to stock performance. CEO Sundar Pichai said in the earnings release that Google expects to invest 'approximately' $10 billion in 2020, a significant amount, but still shy of the expectations set by some analysts. AMD also saw its shares fall around 7% in extended trading. The global automotive industry is facing a potentially momentous shift as Honda and Nissan reportedly explore a merger. According to a report by Asahi Shimbun, citing sources, Honda had proposed making Nissan a subsidiary of the merged entity, an idea opposed by the latter. This news comes as major automakers grapple with the challenges of electrification, autonomous driving, and a changing consumer landscape. Meanwhile, in a statement that has drawn intense international criticism, U.S. President Donald Trump said Tuesday at the White House during a joint news conference with Israel's Prime Minister Benjamin Netanyahu, 'The United States' will take over the Gaza Strip,' and 'we'll own it.' The former New York real estate developer suggested that Gaza eventually could be 'the Riviera of the Middle East,' where 'the world's people' could make their homes — and the 2 million Palestinians currently living in Gaza should leave and be placed in other countries in the Middle East. Tesla CEO Elon Musk's company is experiencing a surge in its share price, with the stock up nearly 10% for the year so far. Wood also told CNBC she's moving away from hardware, and looking at software plays in the artificial intelligence space. The Fed could find itself in a policy Catch-22 if tariffs spike inflation and slow growth. When Trump launched tariffs in his first term, inflation was low and the Fed was raising rates as it sought a 'neutral' level. A manufacturing recession ensued in 2019. This time around, the targeted tariffs that Trump had previously used have been replaced by the threat of blanket duties — which could slow growth and raise prices, putting the U.S. Federal Reserve in a position where it has to weigh economic expansion against controlling inflation. A recent jet crash in Philadelphia has raised concerns about aviation safety.
TARIFFS EARNINGS MERGER TESLA FED INFLATION AVIATION SAFETY
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Trump Pauses Tariffs on Mexico and Canada, but Alphabet and AMD Miss Earnings EstimatesPresident Trump's pause on tariffs against Mexico and Canada brought a temporary relief to the stock market, allowing investors to focus on corporate earnings. However, Alphabet and AMD, two tech giants, disappointed investors with their fourth-quarter performance. Alphabet's revenue fell short of expectations, while AMD's data center sales missed estimates, leading to a drop in both companies' share prices.
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California Pauses Stricter Train and Truck Emission Rules Ahead of Trump ReturnCalifornia has withdrawn its requests for federal approval to implement stricter emissions rules for locomotives and semi-trucks, anticipating pushback from the incoming Trump administration. This comes after the U.S. Environmental Protection Agency failed to approve the rules, leaving California to reassess its options for curbing planet-warming emissions.
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TikTok Restored After Trump Pauses BanTikTok announced it is restoring service Sunday after President-elect Donald Trump said he would issue an executive order to pause the ban on the app. The app was briefly shut down Saturday night, hours before a ban was set to take effect. Trump said he would issue a 90-day extension and pause the law, but his proposed solution involved TikTok owner ByteDance working with the U.S. government. TikTok expressed gratitude to Trump for providing clarity and assurance to its service providers.
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Trump Pauses TikTok Ban, Citing National Security ConcernsPresident Donald Trump signed an executive order Monday to keep TikTok operating for 75 days, a temporary reprieve for the popular social media platform amidst ongoing national security concerns. The move follows the implementation of a law banning TikTok unless ByteDance, its Chinese parent company, sells it to an approved buyer. While Trump delays the ban, legal experts question his authority to extend the 90-day period for a sale.
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Trump Pauses TikTok Ban, Orders 75-Day ExtensionPresident Donald Trump signed an executive order on Monday to temporarily halt the ban on TikTok, giving the social media platform 75 days to operate before facing further restrictions. The ban, which took effect on Sunday following a law passed by Congress, aimed to address national security concerns related to TikTok's Chinese ownership. Trump's move comes as he seeks to navigate a complex situation involving legal, regulatory, financial, and geopolitical considerations.
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Trump Pauses TikTok Ban, Orders National Security ReviewPresident Trump signed an executive order postponing the enforcement of a law that would have effectively banned TikTok for 75 days. The order directs the Justice Department to refrain from taking action against any entities for noncompliance with the law. This move comes after the Supreme Court rejected TikTok's challenge to the law, which required its parent company ByteDance to divest or face removal from U.S. app stores and web-hosting services. Trump expressed concerns about national security but also acknowledged the app's popularity among Americans.
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