The Morning Edge: New Trump Tariff, Third-Quarter GDP, New SEBI Chief

In a move that could reignite global trade tensions, President Donald Trump announced on Thursday that new tariffs on Mexican, Canadian, and Chinese goods will take effect on March 4, citing the continued flow of deadly drugs like fentanyl into the United States.

The 25% duties on Mexican and Canadian imports will be paired with an additional 10% tariff on Chinese goods, which will stack atop existing levies to create a cumulative 20% duty on Chinese products. Speaking from the Oval Office, Trump stressed that insufficient progress in curbing drug shipments — particularly the opioid fentanyl — left him with no option but to escalate trade measures, despite the risk of economic fallout. 

The announcement, first teased on Trump’s Truth Social platform, highlights the administration’s hardline approach to both trade and drug enforcement, even as businesses and allies brace for the consequences. With the March 4 deadline approaching, markets and policymakers are left to navigate the twin pressures of trade disruptions and a worsening opioid crisis, setting the stage for a tense geopolitical and economic confrontation.

Data
The US labour market showed signs of strain as initial jobless claims jumped by 22,000 to a seasonally adjusted 242,000 for the week ending February 22, marking the largest increase since last October, as severe snowstorms and the Presidents' Day holiday likely fuelled the increase. While mass federal layoffs haven’t yet driven claims higher, analysts caution that impacts could emerge in the coming weeks. 

Meanwhile, the US economy showed further signs of cooling, with fourth-quarter GDP growth confirmed at a 2.3% annualised rate, down from 3.1% in the prior quarter. The slowdown reflects harsh winter weather and tariff-related uncertainties, highlighting the challenges of sustaining momentum amid mounting economic headwinds.

Markets
Overnight
US stocks indices closed sharply lower on Thursday, dragged down by a steep decline in chipmaker Nvidia, whose quarterly report failed to reignite Wall Street’s AI rally. Nvidia tumbled 8.5%, wiping out $274 billion in market value, as its weaker-than-expected gross margin forecast overshadowed strong revenue guidance, sparking a broader selloff in the chip sector. Broadcom and Advanced Micro Devices fell over 7% and 5%, respectively, pulling the Philadelphia chip index down 6.1%, while the S&P energy index gained 0.5% as oil prices jumped on President Trump’s decision to revoke Chevron’s license in Venezuela. Investors also digested data pointing to a cooling US economy, adding to the cautious tone in markets.

The benchmark US Treasury yield climbed from an 11-week low on Thursday, buoyed by President Trump’s latest tariff threat and fourth-quarter economic growth. Data showed that the US GDP grew at an annualised rate of 2.3% in the final three months of 2024, unchanged from previous estimates. The market felt the economy entered 2025 with steady momentum. The yield on the benchmark 10-year note rose 1.7 basis points to 4.266%, reflecting a cautious uptick as markets weighed growth prospects against renewed trade uncertainties.

The US dollar surged on Thursday, posting its biggest daily gain in over two months, as President Donald Trump’s latest tariff comments shifted focus from signs of slowing US growth to renewed trade tensions. The dollar index jumped 0.72% to 107.23, its strongest performance since December 18, even as traders priced in two Federal Reserve rate cuts this year, likely starting in July. The rebound highlights the dollar’s sensitivity to economic data and geopolitical developments, though underlying uncertainties suggest that volatility may persist.

Brent crude Oil prices surged over 2% on Thursday as supply concerns intensified following President Trump’s decision to revoke Chevron’s license to operate in Venezuela. Brent crude futures rose $1.51 to 74.04 a barrel, marking the largest daily gain in weeks. The move highlights renewed market sensitivity to geopolitical risks and their potential impact on global energy supplies.

 
 
 
 

Day’s Ledger

Economy

• India October-December GDP estimate and second advance estimate 2024-25 
• India government finances for January
• India core sector output data for January
• RBI forex reserves data
• US January Core PCE Price Index 

Companies

• IIFL Finance board meets to consider a fund raise
• Rana Sugars to announce October-December earnings
• Som Distilleries & Brewerie board meets to consider a fund raise

Policy

• RBI to conduct $10 billion, 3-year dollar/rupee buy-sell swap auction
• Bank of England member Ramsden speaks
• Andhra Pradesh government to present Budget
• Roadshow on commercial coal mine auctions
• US President Trump to meet Ukrainian President Zelensky 

Tickers

• BIOCON's subsidiary has launched Yesintek, a biosimilar of Stelara, in the United States, making it one of the first entrants in this market.
• DIPNA PHARMACHEM has approved a proposal to raise funds of up to ₹100 crore through the issuance of convertible warrants
• LIC has received a demand order of ₹4.9 crore for GST, interest, and penalties from the Deputy Commissioner of State Tax, Mumbai, for the financial year 2020-21.
• NTPC, along with its subsidiary NTPC Green Energy, has signed multiple MoUs with the Madhya Pradesh government to invest over ₹2 trillion in the state.
• Oil and Natural Gas Corporation (ONGC) will invest ₹12 billion in ONGC Green (OGL) through a rights issue.
• RVNL has received a letter of acceptance from Central Railway for a ₹1.36 billion contract.
• TATA POWER RENEWABLE ENERGY Ltd, a wholly owned subsidiary of Tata Power, has secured a contract from the Solar Energy Corporation of India (SECI) to supply 292.5 MWp of domestic content requirement solar modules.
• Texmaco Rail & Engineering has signed a strategic Memorandum of Understanding (MoU) with the Polish technology company Nevomo to collaborate on high-speed rail solutions and predictive track maintenance.
• UPL Ltd’s step-down subsidiary, UPL Holdings Brazil BV, has made an additional investment of $53.85 million in Sinova Inovações Agrícolas S.A.
• WELSPUN CORP has incorporated a wholly owned subsidiary, Welspun Europe S.A., in Spain.

Must Read

• Revenue Secretary Tuhin Pandey appointed SEBI chief
• HC orders NHAI to reduce toll tax by 80% on poorly maintained highways
• Coal India announces levy of ₹300 per tonne across Northern Coalfields mines
• SEBI allows long-short funds; minimum investment ₹1 million
• Tata, M&M will not allow Tesla to succeed in India, says Amitabh Kant
• Farmers’ share in rabi crop consumer prices ranged from 40-67%: RBI survey
• Trump says Mexico, Canada tariffs will start March 4, plus additional 10% on China
• Jindal Steel said to raise bid for Italian steelmaker to €4 billion
• India considers tariff cuts on cars, chemicals to counter Trump’s trade measures
• Central drug regulator creating guidelines fo gene therapies biosimilars: DGCI
• Uttarakhand Forest Dept to buy dry pine leaves for ₹10 per kg to check forest fire

Daily Mantra

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