Happy Thursday and welcome to your morning wrap of the latest business and political headlines from around the world.
We begin with trade, where multiple news outlets are reporting that the United States is nearing a trade deal with the European Union.
Reuters reported that the two parties are heading for an agreement which includes a 15% baseline US tariff on EU goods, along with possible exemptions, citing European diplomats.
European negotiators had been hoping to reach a deal to avoid the 30% tariff rate US President Donald Trump threatened he would impose on goods from the bloc on August 1.
EU member states were set to vote on €93 billion worth of counter-tariffs tomorrow, with a broad majority supporting anti-coercion measures if no deal is reached.
The prospect of a trade deal between the US and Europe has been boosted by Trump’s agreement with Japan, the largest foreign investor in the United States.
The Associated Press reported that the US and Japan have agreed to a deal under which the US will impose a 15% levy on all Japanese imports. The new rate is lower than the 25% tariff that had been threatened if a deal was not reached before August 1.
This agreement is good news for Japanese carmakers, as US importers had previously faced a 27.5% tariff on Japanese vehicles.
However, the new 15% rate on Japanese imports is now lower than the 25% tariff US carmakers must pay on imports from their plants and suppliers in Canada and Mexico.
Announcing the deal on social media, President Trump said: “This Deal will create Hundreds of Thousands of Jobs — There has never been anything like it.”
Donald Trump.
He said that Japan would invest “at my direction” US$550 billion into the US and would open its economy to American vehicles and rice.
The news about the trade deals pushed equities higher on Wall Street.
CNBC reported that the S&P 500 hit another record on the news, gaining 0.5%, while the Dow Jones Industrial Average and the tech-heavy Nasdaq were up 1% and 0.3%, respectively, in late trading.
"So far, the tariff strategy Trump is pursuing looks very inspired, generating serious income, resulting in major investments in the US to avoid the tariffs, and has yet to cause the disruptions and inflation that the naysayers said were certain," Navellier & Associates founder and chief investment officer Louis Navellier said.
In other news, Gaza’s Health Ministry says at least 10 Palestinians have died from starvation in the past 24 hours, bringing the death toll from hunger to 111, including 80 children, Al Jazeera reported.
This comes as more than 100 charity and human rights groups say that Israel’s blockade and ongoing military offensive are pushing Palestinians in the enclave toward starvation, the Associated Press reported.
The open letter came from more than 115 organisations, including Doctors Without Borders, Mercy Corps, and Save the Children.
Israel says it allows enough aid into the territory and blames delivery failures on United Nations agencies. However, those agencies say their efforts are hindered by Israeli restrictions.
Gaza kids charity organisation distributes food.
In climate news, a top United Nations court has cleared the way for countries to sue one another over climate change, including for historic carbon emissions, the BBC reported.
However, the International Court of Justice in The Hague, Netherlands, said determining which countries were responsible for which part of climate change might prove difficult.
The ruling is non-binding, but legal experts believe it could have wide-ranging consequences.
The case was originally proposed by students from low-lying Pacific nations in 2019.
Campaigners and climate lawyers hope the landmark decision will pave the way for compensation from countries that have historically burned the most fossil fuels and are therefore most responsible for global warming.
However, developed countries argue that existing climate agreements are sufficient and that no further legal obligations should be imposed.
Low-lying Pacific nations are some of the most exposed to climate change.
Finally this morning, the meme stock mania of 2021 may have returned, according to the Financial Times.
It notes that shares in doughnut chain Krispy Kreme and camera maker GoPro surged overnight, as retail traders piled into the stocks on social media.
GoPro was up nearly 70% in early trading, while Krispy Kreme gained almost 40%.
The two stocks have become popular on Reddit’s WallStreetBets forum, which was at the centre of the 2021 GameStop surge.
