Daily Read - Sep 26, 2025

Written By R A

Markets unchanged /ES +0.13%, /NQ +0.05%

Catalysts:
PCE (8:30am), UMich sentiment, personal income/spending (savings rate in focus)

Annual inflation in the United States (US), as measured by the change in the Personal Consumption Expenditures (PCE) Price Index, edged higher to 2.7% in August from 2.6% in July, the US Bureau of Economic Analysis reported on Friday. This print came in line with the market expectation.

The core PCE Price Index, which excludes volatile food and energy prices, rose 2.9% in the same period, matching July's increase and analysts' estimate. The PCE Price Index and the core PCE Price Index rose 0.3% and 0.2%, respectively, on a monthly basis.

Fed's Miran: No material evidence of tariff-driven inflation

FRESH TARIFFS

  • US President Trump said that as of October 1st, 2025, a 25% tariff will be imposed on all “Heavy Trucks” made in other parts of the world, US will impose a 50% tariff on all kitchen cabinets, bathroom vanities, and associated products, and a 30% tariff on upholstered furniture, according to Truth Social.

  • US President Trump said that as of October 1st, 2025, the US will impose a 100% tariff on any branded or patented pharmaceutical product unless the company is building its pharmaceutical manufacturing plant in America, according to Truth Social.

  • The Trump administration is reportedly weighing a new plan to dramatically reduce the US' reliance on semiconductors made overseas, according to WSJ sources. Companies that do not maintain a 1:1 ratio over time would have to pay a tariff, sources said.

US-CHINA

  • US President Trump signed an executive order on TikTok, saying he had good talks with Chinese President Xi and that China is fully on board.

  • In a sign of the fragile engagement, people close to the White House said Trump has not committed to going to Beijing, with a firm date for the visit contingent on China’s continued cooperation on issues ranging from trade to fentanyl, according to WSJ.

  • US Deputy Secretary of State confirmed a meeting with her Chinese counterpart took place on Thursday evening, according to Reuters.

OTHERS

  • Japanese Finance Minister Kato announced the establishment of a facility at JBIC for the Japan and US-bound USD 550bln investment package, according to Reuters.

  • Japan’s Tariff Negotiator Akazawa said Japan and the US agreed that US semiconductor and pharmaceutical tariffs on Japan will not exceed those applied to other countries, adding that both sides will continue to evaluate how the new tariffs relate to the existing US-Japan agreement, according to Reuters.

EUROPEAN TRADE

EQUITIES

  • European bourses (STOXX 600 +0.2%) are modestly firmer across the board

  • European sectors hold a strong positive bias, with only a couple of sectors marginally lower. Most of the focus this morning has been on the latest Trump tariffs, where he announced 100% tariffs on Pharma, 50% on kitchen cabinets, and 25% on heavy trucks.”; for the latter, Daimler Truck (-2.5%) moves lower, whilst Volvo (+3%) remains in the green. Bernstein writes that Daimler Truck could be most affected by these tariffs, given its high exposure to the US; analysts add that Paccar (+5% pre-market) stands to benefit the most.

  • Delving into the pharma tariffs; Roche (+0.2%), AstraZeneca (U/C). Jefferies writes that “overall, we think this is a win for Pharma and shouldn't have a material impact”. In US pre-market trade, the likes of Eli Lilly (+1.7%) and Viking (+1.4%) both move higher.

    Commods

  • Indonesia Mining Minister says production at Freeport (FCX) has not resumed, stoppage affects output and revenue; spoke with Freeport about extending the mining permit to past 2041.

  • WTI and Brent remained balanced after another day of gains, making highs at USD 65.34/bbl and USD 69.68/bbl respectively on Thursday. (On Iran)

    FX

    • After two sessions of solid gains for DXY, the rally has paused for breath

    • EUR firmer on DXY catching a breadth

    • JPY is flat vs. the USD - softer than expected Jap inflation, vs stronger USD

    • GBP is attempting to atone for recent losses vs. the USD (disappointing flash PMIs from Tuesday)

    • Oracle (ORCL), Silver Lake, and MGX will be the main investors in TikTok US with a combined 45% ownership, according to CNBC’s Faber, citing sources.

    • Meta (META) is reportedly in talks with Alphabet’s Google (GOOGL) to integrate Gemini for enhanced ad-targeting capabilities, according to The Information.


      NATO

      • European officials privately told Russia they are ready to shoot down jets and view Russia’s Estonia incursion as deliberate, according to Bloomberg.

      • French President Macron said France stands ready to support Denmark in assessing the situation and contributing to the security of Danish airspace, according to X.

      RUSSIA-UKRAINE

      • US President Trump said Ukraine has a shot at getting territory back and that Russia is doing poorly, adding that he is dissatisfied with what Russian President Putin is doing, according to Reuters.

      • IAEA said a drone was downed and detonated around 800 metres from the perimeter of Ukraine’s South nuclear power plant overnight, noting that 22 UAVs were observed late last night and this morning and that its team heard gunfire and explosions, according to Reuters.

      • US President Trump said he believes Turkey will halt purchases of Russian oil, adding that it is harder for Hungary and Slovakia as they are landlocked with one pipeline, according to Reuters.

      MIDDLE EAST

      • US President Trump said he had good talks on Gaza and really good talks with Israeli PM Netanyahu, adding that a hostage deal could happen soon, according to Reuters.

    • DATA RECAP

      • Japanese CPI Tokyo Ex fresh food YY (Sep) 2.5% vs. Exp. 2.8% (Prev. 2.5%)

      • Japanese CPI, Overall Tokyo (Sep) 2.5% (Prev. 2.6%, Rev. 2.5%)

      • New Zealand ANZ Roy Morgan consumer confidence 94.6 (prev. 93.2)

OTHERS

  • US President Trump said he had good talks with Turkish President Erdogan and that the meeting was conclusive on many things, according to Reuters.

  • South Korea fired warning shots at a North Korean commercial vessel for crossing the maritime border, according to Yonhap.

  • Iran and Russia have come to a USD 25bln agreement to construct four nuclear power plants in Iran, via IRNA.

CRYPTO

  • Bitcoin is on the backfoot today and trades shy of the USD 110k mark.

Pre-market:
In premarket trading, Mag 7 stocks are mixed (Amazon +0.3%, Microsoft +0.5%, Alphabet +0.3%, Meta Platforms -0.08%, Apple -0.9%, Tesla +0.4%, Nvidia -0.5%). 

  • Drugmakers are inching higher after President Donald Trump announced a plan to impose a 100% tariff on branded and patented drug imports and included exemptions for companies with US manufacturing. Citi says the news “lifts a significant overhang, as political uncertainties have kept investor interest at bay for most of this year.”  Eli Lilly & Co (LLY)  +1%, Merck (MRK) +1.2%.

  • Apellis Pharmaceuticals (APLS) falls 6.2% as Goldman Sachs cuts its rating on the clinical-stage biopharmaceutical company to sell.

  • Concentrix (CNXC) slumps 21% after the call-center operator gave a fourth-quarter profit outlook below consensus estimates.

  • Harrow (HROW) rises 1.6% after entering into an agreement to acquire Melt Pharmaceuticals Inc.

  • Intel (INTC) climbs 4% and GlobalFoundries (GFS) gains 9% after the Wall Street Journal reported that the Trump administration is weighing a new plan to reduce US reliance on chips made overseas.

  • Paccar (PCAR) gains 6% as Trump sets a 25% tariff rate on heavy trucks made outside of the US.

  • Wayfair (W) declines 2% after President Trump announced new industry-specific tariffs targeting heavy trucks, kitchen cabinets, bathroom vanities, and upholstered furniture.

R A