CNBC

Lead Story

The trade war between the U.S. and Canada escalated dramatically as President Donald Trump threatened to raise tariffs on Canadian cars, trucks, and auto parts to 50% on January 1, 2027, following a breakdown in bilateral negotiations. This follows the implementation of 50% duties on approximately $20 billion worth of other Canadian imports over the weekend.

Markets & Economics

U.S. stock indices finished mixed, with the Dow gaining 140.15 points (0.26%), while the S&P 500 slipped 0.28% and the Nasdaq Composite fell 0.76% as a sharp decline in semiconductor and memory names pressured tech. Longer-dated Treasury yields moved lower, with the 10-year Treasury note yield falling over 3 basis points to 4.7%, following reports that Treasury Secretary Scott Bessent may tap the roughly $950 billion Treasury General Account to fund bond buybacks (watch the Treasury General Account report). U.S. Trade Representative Jamieson Greer placed the blame for the failed negotiations on Canada, claiming Ottawa altered its demands at the eleventh hour (watch Greer’s Squawk Box interview). Meanwhile, oil prices dropped roughly 1.3% with WTI trading at $85.93 and Brent crude at $93.22 per barrel as investors braced for the administration’s sweeping secondary sanctions under “Operation Economic Outcast”.

Business & Earnings

Alibaba’s Hong Kong-listed shares plummeted over 8% after pricing an 80 billion Hong Kong dollar ($10.20 billion) share placement to fund its full-stack AI push, closely following a reported 75% drop in quarterly net income driven by massive AI-related capex. On the IPO front, fast-fashion giant Shein filed to raise up to $1.77 billion in Hong Kong, valuing the firm at close to $27 billion—a steep comedown from its private valuation peak of $98.2 billion in 2022. In media M&A, California AG Rob Bonta abruptly canceled settlement talks with Paramount Skydance over its proposed $110 billion acquisition of Warner Bros. Discovery, accusing Paramount of breaching confidentiality and leaking discussions in bad faith. Additionally, Trump Media interim CEO Kevin McGurn defended the company’s $100,000-per-month Truth API service, revealing that customer agreements have climbed into “the mid-teens” (watch the Kevin McGurn interview). Separately, United Parcel Service (UPS) disclosed a more than $2 billion strategic investment through 2028 into its international, healthcare, and supply chain solutions.

Investing & Commentary

Jim Cramer warned that the AI data center trade is facing severe political and community pushback ahead of the midterms, leading him to cut Broadcom roughly in half and downgrade Corning and GE Vernova to 2s, though he argues this regulatory bottleneck is a “godsend” for dominant hyperscalers like Alphabet and Microsoft. Meanwhile, Truist Securities reiterated a buy rating on CoreWeave with a $165 price target, noting that CoreWeave’s 25% pricing increase in July will easily absorb rising Nvidia GPU costs. Furthermore, Baird initiated coverage on Chili’s owner Brinker International with an outperform rating and a $325 price target, projecting 32% upside as the casual dining chain’s turnaround unlocks system-capacity and throughput gains.

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🎧 This daily digest would make a fantastic audio briefing if you’d like to hear the team discuss today’s trade tensions, the bond market twist, and the countdown to Nvidia’s earnings.