
News & Insight • Weekly Newsletters
11 July 2025 | William Buckhurst | Charlie Todd
That Was The Week That Was
MACRO
- Is the UK heading for a recession? Following on from a -0.3% number in April, May’s estimated GDP numbers were slightly better but still negative at -0.1%. But it was not all bad: growth in March was revised upwards from +0.2% to +0.4%, further indicating that companies invested to prepare for tariffs that came in in April. Nonetheless, it is clear that the overall trend is around zero growth, and the country could well be heading for a recession.
- Oil finished lower following news that OPEC+ was looking at another big output boost for September amid further signs that it is unwinding the 2.2m barrels per day (bpd) cut first enacted in 2023 to support prices.
- Lots more tariff announcements which affected all parts of the world. President Trump stated that Japan and South Korea would have a 25% tariff rate imposed unilaterally, in line with market expectations. He stated that he would impose tariffs on countries “participating in BRICS”, probably around 10%, with India facing an additional 10%, due to them aligning themselves with “anti-American policies”. Trump stated that he might impose a 50% tariff on Brazil over its treatment of former President Jair Bolsonaro. Over the weekend he also suggested he would impose 30% tariffs on EU and Mexico from the 1st August. Canada has also been threatened with a 35% tariff on goods that are not part of US-MCA (United States – Mexico – Canada Agreement which replaces NAFTA) for failing to deal with fentanyl flows.
- Trump stated that he would impose a 50% tariff on copper products being sent into the US and could also announce substantial new rates on pharmaceuticals with reports noting that drug companies could face as much as 200% on imports.
COMPANY NEWS
- Shell released an underwhelming trading update suggesting that second quarter gas trading and Chemicals Trading & Optimisation segment earnings were forecast to be significantly below the previous quarter.
- Exxon also cautioned that it would see a significant impact to its profitability from lower commodity prices.
- Costco shares trade on a very expensive multiple; however, it continues to perform well as it released June total sales growth of 5.8% vs 5.6% expected. Other International growth of 8.2% was above estimates.
- Merck shares rose on the week after it agreed to acquire respiratory drug manufacturer Verona for $10bn. Verona recently launched a new drug for chronic obstructive pulmonary disease, COPD, which is projected to generate peak sales of up to $4bn with Merck stating that it sees the US market for COPD drugs rising from $17bn to $27bn in 2032.
- Hunting, the oil services company rose sharply after issuing a trading update that was better than expected with one of the troublesome divisions returning to growth. They also announced a 13% increase in the dividend plus a $40m share buyback.
- Another European car manufacturer provided poor guidance, with Porsche indicating that it was set for a tough rest of the year as the company’s global deliveries declined 6% over the first half. Management commented that “we expect the environment to remain challenging” citing competition in China as the main factor, where its sales declined 28%.
- Is WPP dying? It issued another profit warning and fell almost 20% on the day after cutting guidance with revenue expected to decline by 3-5%. Margins were also forecast to decline 0.5-1.75% in the year.
- Flutter agreed to acquire the remaining 5% of its Fan Duel subsidiary from Boyd for $1.8bn ($31bn total).
- Travel Food Services (TFS), a subsidiary of SSP Group, will proceed with an Indian market IPO on the 14th July at the top end of its range.
SNAP, CRACKLE & POP
WK Kellogg finished over 30% higher after it was confirmed that it had agreed to be acquired by Ferrero for $3.1bn. WK Kellogg was formed when Kellogg’s split into two parts, with the other, Kellanova, being bought by Mars for $30bn in August 2024. The deal will combine the manufacturer of Nutella with the maker of Froot Loops and the US manufacturer cereals such as Rice Krispies (Kellanova produces for the rest of the world). This transaction continues Ferrero’s international expansion into America.
In other news, Swiss cocoa and chocolate company Barry Callebaut fell 13.4% after cutting sales guidance as management commented that the global chocolate market “saw its largest decline in a decade in the third quarter”.
TECH WEEK
Is Mark Zuckerburg right to think people will interact solely with smart glasses rather than smart phones?
Apple, which derives most of its revenue from smart phones, was under pressure from Meta after it was reported that the latter had hired its head of AI, Ruoming Pang. Apple also announced that longtime COO Jeff Williams would be retiring and would be replaced by Sabih Khan, who has been with the company for 30 years.
Meta CEO Mark Zuckerberg has been on a hiring spree, bringing in major AI leaders and hiring many researchers from OpenAI and Anthropic. Meta also separately announced that it had acquired a 3% stake, worth around €3bn, in glasses manufacturer EssilorLuxottica, sending the shares 5.6% higher – and was reportedly considering taking the investment to 5% over time. Both companies have been working together to develop AI smart glasses.
It was reported that Autodesk was considering acquiring rival engineering software firm PTC, which has a market value of around $23bn. Any deal would continue the consolidation of the industry after Siemens acquired Altair for $10bn while Synopsys has agreed to buy developer Ansys for around $34bn pending Chinese approval.
Coreweave, partially owned by Nvidia, fell 3.3% after announcing that it had agreed to acquire data centre operator Core Scientific, in an all-stock transaction for $9bn. The company stated that the deal would immediately eliminate $10bn of lease overheads and that it sees $500m of annual rate costs. Core Scientific has been one of the top Bitcoin miners that build large scale data centres and has previously gone bankrupt, emerging out of it in January.
THE WEEK IN HISTORY
1836: Andrew Jackson’s US government curbs land speculation by forcing federal land agents to only accept gold and silver as payment. The order created rapid deflation in the economy. Lack of credit available led to a collapse in land prices, and was a primary cause of the panic of 1837, which would be one of the US’s worst financial depressions in history.
1998: Russia secures a $22.6bn bailout from the IMF, the World Bank and the Japanese government. Despite the bailout, Russia’s economic woes continued, and the country ultimately defaulted on some of its debts just a month later.
MARKET DATA |
||||
Returns |
1 Week |
1 Month |
1 Year |
5 Years |
UK Equities (% capital return) |
1.36 |
0.83 |
7.74 |
43.73 |
World Equities (% capital return) |
0.34 |
2.89 |
12.03 |
76.96 |
10 Year US Treasury Yield (%) |
4.34 |
4.48 |
4.29 |
0.63 |
GBP / USD (fx rate) |
1.36 |
1.35 |
1.30 |
1.25 |