Morning Wrap (18.04.2025)

Asian markets mostly higher in Friday trading with Tokyo's Nikkei 225 gaining 0.6% to 34,583.29 and South Korea's Kospi rising 0.3% to 2,478.39. Taiwan's Taiex jumped 0.8% supported by tech gains after TSMC's earnings matched expectations. China's Shanghai Composite bucked the trend, falling 0.3% to 3,272.09. Many other markets were closed for Easter holidays.

Japan's core inflation accelerates to 3.2% in March driven by persistent food cost increases, with core CPI matching market forecasts and accelerating from February's 3% gain. This marks three straight years of inflation exceeding the BOJ's 2% target, complicating next week's policy decision as the central bank weighs mounting price pressures against risks from U.S. tariffs.

Trump signals potential easing of tariff escalation stating "I don't want them to go higher because at a certain point you make it where people don't buy." This suggests diminished appetite for across-the-board tariff increases after markets reacted strongly to their April 2 introduction, though he maintained the 145% duties on Chinese imports.

Netflix delivers strong Q1 results with revenue of $10.54 billion (up 13% YoY) and EPS of $6.61, both beating analyst expectations. The company guided to Q2 revenue of $11.04 billion, above Wall Street forecasts, and maintained its full-year guidance despite economic uncertainties. Netflix stands out among Big Tech with its stock up 9.2% YTD compared to declines of 17%+ for Apple, Amazon, and Alphabet.

Indonesia proposes increased U.S. imports to avoid tariffs with chief economic minister Airlangga Hartarto announcing plans to boost U.S. imports by up to $19 billion, including approximately $10 billion in energy imports. Indonesia will increase purchases of U.S. agricultural products and capital goods to eliminate its trade surplus with Washington and avoid the 32% tariff currently paused for 90 days.

Oil recovers some losses with U.S. benchmark crude gaining $2.18 to $64.01 per barrel and Brent crude picking up $2.11 to $67.96. Energy stocks rallied in response, with Diamondback Energy jumping 5.7% and Halliburton climbing 5.1%. Trading was paused Friday for Easter weekend.

USTR revises ship fees targeting Chinese vessels with exemptions for domestic carriers, Great Lakes vessels, and ships servicing the Caribbean and U.S. territories. The revised plan phases in fees more gradually than the February proposal, which had alarmed the global shipping industry with potential fees of up to $1.5 million per port call.

Boeing faces potential Chinese import challenges with flight tracking data showing a Boeing 737 MAX that arrived at a Shanghai completion plant returning to the U.S., signaling possible delivery disruptions amid escalating trade tensions. At least four new 737 MAX planes are sitting at Boeing's Zhoushan facility where they undergo final preparations before customer handover.