Week 14 Wrap: Tariffs tank markets as expected; will Rio Tinto ditch LSE?; EU ETFs soar

Let’s start with the obvious one: Trump’s wave of “Liberation Day” tariffs have finally come, and as expected, they’ve tanked global markets. At least Australia is only copping a flat 10% blanket.

Why did Australia get tariffs at all? Donald Trump sounded almost apologetic when he described hitting Australia with tariffs. Supposedly it’s because we don’t want their beef due to mad cow disease risk, and this has become a “priority” for the White House – sending US beef (and chicken) to Australia.

One is left wondering what other priorities might be getting overlooked. Australia wants to take the US to the WTO; Albanese said he won’t budge on biosecurity controls.

The question really is how long these tariffs last for. Should they become permanent, UBS sees a risk of US CPI inflation returning to 5% – nearly double where it currently stands.

So what else happened?

Virgin Australia is looking at listing on the ASX – again – after it de-listed during COVID; the stock has attempted to secure interest for an IPO down under multiple times since. Will this one take off? Who knows.

James Hardie shorts continue to climb after its decision to buy AZEK for a whopping $14B, a deal which clearly makes no sense to many. Also, one activist investor is asking Rio Tinto to ditch the London bourse, but the Norwegian wealth fund would prefer it to stay.

In the US, CoreWeave – an AI play – decided to list at a terribly unfortunate time, but even then, its IPO has gone worse than many were thinking. It appears to be the latest evidence available that market enthusiasm for the AI thematic broadly continues to stall.

Trump also threatened to bomb Iran this week as part of ongoing attacks against the Yemeni Houthi government (if you want to call it that,) but that wasn’t enough to stop Brent dipping below US$70/bbl as tariff uncertainty leaves some oil traders foreseeing persistent subdued demand.

Going back to Trump, his media company has listed on the NYSE Texas, which is what it sounds like, in a move of support for that infant bourse.

Oh, and American independence policies appear to be galvanizing its competitors: EU ETF inflows surged this week to record levels as investors look for stock markets that aren’t America’s, and, tariffs have prompted China, Japan and South Korea to issue a joint statement of solidarity.

That poses interesting questions for Australia.

Australian Equities

Virgin Airlines once again gearing up for an IPO on the ASX

James Hardie shorts climb to 3.5% as AZEK deal fails to win hearts

Despite everything, RBC Markets rates Wisetech a buy (“outperform”)

Palliser Capital wants Rio Tinto to ditch London bourse; Norway wealth fund says stay

International Equities

US uncertainty sees US$11B flow into European ETFs

CoreWeave IPO disaster suggests AI hype is truly waning

Lockheed Martin pares some losses as US awards multi-billion missile contract

US pharma stocks rattled as often-absent RFK Jr. appears to fire vaccine chief

Commodities