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Catalyst. I'm Madison Mills. 30 minutes into the US trading day. Let's get you the three catalysts we're watching this hour. First up, we break down the market reaction to the US-China trade U-turn as the Buy America trade comes roaring back. Plus we break down the trade deal's impact on commodities as gold drops and oil surges, and we get the latest read on the consumer as we sit down with the chief financial officer of buy now and pay later giant Air.Half an hour into the start of US trading. Let's get you a check on the markets brought to you by Tasty Trade. Taking a look at the major averages here, huge gains across the board. You've got your S&P 500 above that 5800 level, up over 2.5%. Your tech-heavy Nasdaq up over 3.5%. Your magnificent Seven stocks roaring back today, potentially entering into a bull market with that ETF up nearly 20% from its latest trough. Let's look at the board.Over to the bond market taking a look at a little bit of a sell off here. You've got your 10 year yield up 8 basis points hitting at 445. Your 30 year yield is up 5 basis points as well. And finally, looking at Bitcoin having a little bit less participation in the risk on rally today, it's up about 0.2% after a massive run over the course of the last 10 sessions here. I want to bring in my co-anchor for the hour, Kevin Gordon. He's the director and senior investment strategist over at Charles.Schwab, Kevin, it's great to have you in the studio for the hour. I'm very excited to get your insights on a crazy day. Where, where are you sitting right now with this rally? How much trust do you have in this? What are you thinking?

Well, I mean, I think it's warranted in the sense that, you know, we had become so one-sided from a sentiment, you know, standpoint in terms of negative sentiment, really overtaking and overwhelming the market, you know, over the past month. So in a catalyst sense, you know, makes sense because this is sort of the ultimate positive catalyst in terms ofGetting a pretty meaningful pause with a pretty meaningful trade partner, I, I think from here what I'm most interested to see, and it was interesting listening to the president's remarks um just a few minutes ago, whether this is a pretty full scale reversal of what the original maybe intended or stated goal was of the administration in terms of trying to close trade deficits, trying to completely reorder global trade to some extent if that is the case, um it's a pretty meaningful change, I think, in the trajective of the economy in a good way because before.I mean you were looking at pretty high and aggressive double digit tariff rates which you're potentially still looking at, but the goal was very different than just trying to get to some kind of purchase agreement, especially if you're going back to something like we saw in 2018, 2019, very different set of um sort of rules and a playbook than you had just a few weeks ago.

How does that and the wording from the administration around tariffs such as Secretary Besson talking about how it's still a national emergency, the trade deficit, how does that frame.Thinking on what the leadership is going to look like as we head out of this moment. Yeah, I

mean, I think if that starts to get peeled off and if you start to see more of a relaxation around around that rhetoric, it probably hopefully brings some of the laggards that we've seen in the sell off and those that have seen the weakest bounces since the since the drawdown into April 8th, things like freight logistics and you know more of the consumer oriented parts of the market, hopefully that gives them more of a tailwind that brings them into the rally because the stage that we're at right now after you go through that big bush down and you start.See some bread thrusts. This is really the time that you need to see those laggards pick up for that bull market to look a lot more sustainable. So you're getting a lot of signals that are firing and that are really favorable. Small caps rallying more than large caps this morning, I think is a really important move to look for. But yeah, you would really need to see more conviction, I think, on the part of those parts of themarket.

Yeah, and currently we are sitting at just under 1% declines on the S&P 500 year to date. So certainly a crazy run. It's been. Thank you, Kevin. You're going to stick with us, really appreciate it.Let's talk about the Buy America trade because it appears to be roaring back on Wall Street. The dollar spiking today amid the easing of US-China trade tension as the S&P 500 is looking to erase all of its post-liberation Day losses. So how should investors position going forward? Joining us now on this, Evan Brown, UBS asset management, head of multi-asset strategy portfolio manager, really appreciate you joining us this morning. Evan, so talk to me about this. Is the Buy America trade so back already this morning?

Yeah, I think so. I mean, it's been coming back over the last few weeks as I think people have increasingly realized that these tariffs were unsustainable and now we're actually getting the policy action reflecting it. But I think this narratives swing very quickly in this market, and we came into the year with peak US exceptionalism, then we almost went to America's uninvestable, and I think we're coming out of that swing. I think the broad truth is thatUm, foreign investors and US investors are probably overallocated to US assets. I mean, it's been a big winner over, over 15 years essentially and so over time some more diversification makes sense, um, but it's not, you know, we got to a point where the narrative got so stretch or it's like the US is not a US bonds are not a safe haven or US equities, you know, just completely downplaying the the earning strength and the power of some of the mag 7.I think that just went too far. So what we're saying for investors is kind of use this US rebound to over a structural period be allocating a little bit more into international.

Yeah, use the rebound to diversify if everything that happened after April 2nd made you sit a little sickly when you're looking at your portfolios. I am curious about the dollar and how you're thinking about whether or not stocks can fully recover stateside without a bigger bounce in the dollar.

Yeah, so I, I think the dollar, the dollar came down about 10% as part of this unwind of US exceptionalism trade. I think like what we're seeing today, we're going to see a bounce in the in the dollar because I think just.The narrative got too stretched and the US is OK. US outperformance can resume for some period. Now the dollar's decline has actually been very helpful in supporting the outlook for US earnings, making it look a little bit, a little bit better. So we'll lose some of that tailwind for US earnings, but overall I do think.Like our our broad, you know, advice to be reallocating more broad, I think that the long term trend again as the dollar rises, you want to be allocating a little bit more into international as other currencies weaken andyou know,

presumably keeping some of that upward pressure and that strength in the dollar is probably where the Fed stands and you're seeing it in the bond market this morning, a lot of cuts getting priced out just for for this year.Um, in terms of what that means for bonds as a diversifier in a portfolio, maybe just in the US right now and then maybe your thoughts globally, but how do you think they play a role or what role do you think they play? Has that changed at all for you guys over the past few months or even over the past, you know, 12 hours?

Yes, I think so. I mean, bonds still play an important role as a as a hedge in portfolios. They may not be.As powerful a hedge as we've seen in recent years because one, we have more structurally higher inflation, and two, we have a big fiscal deficit and debt load so we don't expect to see 10 year yields declining in a in a recession scenario or a growth scenario the same way we've seen in prior major slowdowns, but they still play that role.In the portfolio and the all in yields right now are pretty solid. I mean if we're 44 right now in the 10 year 450, 460, I mean that is, that is reasonably good value for for duration. You get your coupon there, you're gonna get some protection if the economy slows down, so they still diversified just not quite as much as we've seen in the past.

I wonder if you can chime in on this, Kevin, because obviously.Work with a lot of longer term investors at Schwab is today a day to tell them, hey, rediversify, reallocate your portfolios so that if the volatility continues, as Evan has pointed out, you're not as upset by it.

I mean it's it's, it's been a key message from our fixed income team for the past, you know, better part of the past almost 2 years as you've seen this big run up in yields, especially if you're looking outside of the treasury space. I mean if you go into the corporate.You know, investment great part of the market. I mean yields look quite attractive, um, especially if you're thinking about, you know, if you're a more risk averse investor and you're a little bit nervous about some of these swings that we've seen in the equity market, obviously over the past several weeks it's worked to your benefit, but before that it was pretty scary. So if you're not as comfortable with those swings to the downside but also to the upside, um, then the bond market provides just more of a you know.More as a ballast, but I, I wonder, you know, one of the things that's, that's kind of interesting to think about in terms of longer term expectation return expectations for, for US equities, um, in particular large caps, those that look relatively overvalued if you're looking at their long term history and where rates are now, how is your thinking about that maybe changed, if at all, um, given where the bond market has gone and where rates now sit?

Yeah, it's it's funny because everyone produces their capital market expectations every year and for years there's been lower expectations for the US than the rest of the world and for years the US has has beaten those expectations.Uh, I think we're coming into a world where, uh, we might actually start seeing those, those capital market expectations play out with international outperforming, and, and the reason is, yes, there's valuations, but there's also a catalyst here which is that we do have an administration that is engaging in policies that are.Uh, overall less constructive like, yes, we're all breathing a sigh of relief today. We, we're happy to see the tariff climb down, um, but we're, we still have a higher level of tariffs than we saw at the beginning of the year, and that is a tax on, on consumers. Um, we also have are going to have structurally higher inflation, right? If it weren't for these tariffs, we would be on our way to 2% inflation instead.Inflation is going to stay stickier for longer and so not questioning the earnings power of US companies, but the overall policy making apparatus that we're seeing another thing being what's happening with immigration. We've gained from this big increase in the labor supply and yes, it's politically fraught, but that was something that was helpful in engineering a soft landing.As we get as as we slow down immigration or engage in deportations, that means that we have a slower labor force and that lowers potential growth. So when you look at um labor force participation and productivity, they look a little less good looking out the the next few years for the US. Those have been tailwinds over the recent years. They're not going to be, whereas the rest of the world, you know, we're seeing fiscal stimulus from Europe. We're seeing, you know, China's reemergence on the tech side.So I think, I think now we finally have some catalysts, not just the valuation differential, but some catalyst to to lead to some mean reversion in thosevaluations.

Yeah, really great overview, Evan. Thank you so much for joining us on quite a historic day this morning. Really appreciate your time. Thank you. Thank you. And Kevin, you're going to stick with me, so I appreciate that as well. Coming up, we're going to take a look at some of today's biggest movers, including why Apple is still planning to raise iPhone prices, their shares up over 5.5%.

Lots of bullishness in the market today with the latest tariff detente. But here's another bid on stocks that is reasserted in recent weeks as we climbed out of earnings season, and that is stock buybacks. I'm Jared Blickery, host of Stocks in Translation, and today we're going to take a closer look at companies buying back their own stock. Now let's talk cash. What do companies do when they've got extra dough sitting around?A big slice of that goes to buybacks. That's right. Companies shopping for their own stock makes up about 40% of their spending, and another chunk, about 30%, goes to good old fashioned caps, that's capital expenditures, building factories, upgrading tech, basically growing the business. Then shareholders, they get a nice 25% slice directly through dividends and the leftover 5% that goes.Of debt paydowns, M&A deals, stashing cash for rainy days. Now here is the headline. 2024 was an absolute blowout year for buybacks. Companies in the S&P 500 executed a record $943 billion in repurchases. That's up almost 20% from the year prior. Total shareholder returns, and that is buybacks plus dividends, it hit a juicy record of over 1.trillion dollars. So who is leading the spending spree? Big tech, of course. Tech giants shelled out over a quarter, about 27% of all buybacks, spending a cool $253 billion. Big banks in finance, they weren't shy either, coming in next with nearly $175 billion. Even sleepy consumer staples companies practically doubled their buybacks in a single year.Now zooming in some of these buybacks are very concentrated at the top. The top 20 largest companies alone made up nearly half of all repurchases. King of the Hill, King Apple, spending over $104 billion last year. And for context, Apple has spent $700716 billion on buybacks over the last decade. Meta and Nvidia, they also dialed up their programs with Nvidia more than tripling spending. So it seems that going big might be the new normal.But why buybacks? Two words earnings engineering. Companies love buybacks because they shrink share counts and fewer shares outstanding. That boosts earnings per share, EPS making the numbers look great. It's also handy if you're paying your team in stock because buybacks offset that dilution. Last year, about 12% of the S&P 500 companies reduced their share accounts meaningfully.Now here's a twist. Companies cannot always buy back their own stock. Most have to pause around buybacks around earnings season, and this creates what's called the buyback blackout window. Typically 75% of S&P 500 companies sit on the sidelines during peak earnings week, removing a critical market support right when volatility tends to spike. Now the charge.The increasing number of companies emerging out of that window right now, but keep an eye on the VIX when the next season is approaching. Oh, and speaking of policy twists, remember that 1% buyback tax that was thrown into the inflation Reduction Act of 2023. Congress is debating bumping it up to 4%, so that could also shake up next year's buyback schedule as well.Tune into more jargon busting deep dives on stocks and translation, new episodes on Tuesdays and Thursdays on Yahoo Finance's website or wherever you find your podcasts.

All right, Jared, thank you so much.It's time for some of today's trending tickers. We are watching automakers, retail names, and Shopify. First up here, automakers rising after news the US is pausing reciprocal tariffs on China for 90 days as the two nations continue negotiations to find a permanent trade deal.Ford, General Motors, and Stalanti all withdrew or trimmed their guidance for the full year, citing tariff uncertainty. The auto industry is still facing sector-specific tariffs of 25% on all imported vehicles and auto parts, as well as 25% on imported steel and aluminum.Next up, retailers also getting a boost from progress on trade negotiations. Nike, Lululemon, and Target all rising, but Target is climbing despite getting a downgrade from Bernstein to underperform this morning. Notable here, the de minimis exemption, which allows packages below a certain value to be imported tax-free, does not appear to be part of the US-China truce. That could still be a headwind for so-called fast fashion retailers going forward.And finally, Shopify is set to replace software company MongoDB on the Nasdaq 100 index starting May 19th. Shares of Shopify jumping on the news. The e-commerce platform is up over 50% in the past 12 months, but is still taking losses year to date. You can scan the QR code on your screen to track the best and worst performing stocks with Yahoo Finance's trending tickers page.President Trump says he spoke with Apple CEO Tim Cook this morning following an agreement by the US and China to temporarily lower tariffs. Meantime, a Wall Street Journal report out this morning saying Apple is considering price increases for its fall lineup. The tech giant does not want to attribute the price hikes to any tariffs on Chinese goods. Here to put it all together for us, market domination co-host Josh Lipton. Hey Josh,

there. So could your new iPhone this fall cost more?Says it just might reporting that Apple is considering prices, price increases for the fall iPhone lineup. The US and China did agree to suspend tariffs, but a 20% tariff President Trump imposed remains in place over fentanyl. Remember, he did exempt smartphones from a separate reciprocal tariff on Chinese goods, which will temporarily now fall to 10% under the new deal. Yes, Apple, we know, is making moves with its supply chain, but the Journal is saying China will still.The bulk of production for its most profitable high-end phones. So Apple is considering raising prices to protect its margins. How would such a decision be explained to the Apple fan by adding new features and design changes rather than pinning it on the Trump tariffs? There is a lot we don't know still here, of course. The prices were indeed raised by how much. We'll call the current iPhone 16 based model starts at 799. And what new features and design changes could these newactually boast, well, there are, as always different reports and rumors, but we don't know for certain because Apple will be as always very tight lipped on that front. Apple did say on that earnings call earlier this month that the current Trump tariffs would translate into $900 million in additional costs in this quarter. Now for more insight, I just got off the phone with Gene Munster over at Deepwater Asset Management. Munster is a longtime Apple analyst. He bets if tariffs stay at that.10%. Apple could raise iPhone prices by 5% in the fall. If we don't see a resolution though, then prices could go up even more. What would all that mean for demand? Munster says a 5% hike wouldn't change much in his opinion. More than that, however, could mean more of a significant impact.

Matty. All right, Josh, great overview as always, really appreciate you making time for us. Thank you so much. We're going to have all your markets action ahead, so stick around. You're watching Catalysts.A firm rebounding today after weaker than expected 4th quarter guidance weighed on the stocks. Still, the buy now pay later company topping fiscal 3rd quarter expectations. Joining me now, Michael Linford, a firm's COO. Michael, great to speak with you. Obviously there were highlights in the quarter 3 36% year over year volume growth, double digit revenue growth. The guidance was the issue for Wall Street. Talk to me about the biggest factors weighing on guidance going forward.

Thanks for having me. Yeah, we, we posted a quarter that I think is just a phenomenal quarter. In our third quarter, as you mentioned, GMV grew 36%, but that was actually the 3rd quarter of accelerating GMB growth, and inside of that we saw the March volumes accelerating to 40% growth continuing through April. We also saw revenue growth of 36% consistent with GMB growth, and our unit economic number was up 53% year on year.While posting a 22% operating margin, these are really impressive numbers for a business like ours in this environment. So a lot of, a lot of progress that we've made. Our outlook going forward maintains that that optimism for where the business is at and the momentum that we see tempered only by the the realistic fact that you can't accelerate forever and so.The business is at a spot where we feel like it's growing extremely healthy, delivering really strong margins, and the outlook couldn't be better.

So talk to me about the sentiment that you are sussing out from consumers because obviously as a buy now pay later provider you have a good sense of how the consumer spending and how they're reacting to this environment.

Yeah, we feel like we have a very unique and powerful signal into the consumer that really is unmatched out there and part of that's because of our business model we by definition have to pay really close attention to the data that we see and and we have a wide distribution where we see lots of categories and we can, we can get a very good picture of where we think the consumer is at and we think about it in two big areas. The first is demand. Are consumers outspending in the economy and the second is credit, how are consumers paying back their loans.On the demand side, we again saw 3 quarters of the 3rd quarter of accelerating growth, 40% growth in the third month last quarter continuing to the first month this quarter. Those are really impressive data points that suggest that consumers highly engaged in the economy. When you think about the credit side, our credit results really do speak for themselves. We had really strong delinquency performance last quarter. Our economic numbers above our long term goal of 3 to 4%.And our execution in the EBS capital markets do suggest that we've got a really um exciting product for the capital markets which, you know, really are the best read of the quality of credit of the loan that we're creating.So we feel like we've got really strong demand on the top, really great credit performance, and that's a really good sign for the consumer. I think a lot of the conversation right now is not so much about what is happening, but what might happen into the future. And of course we don't have any crystal balls, but what we do know is that our business model gives us incredible advantage in navigating any uncertainty. We give certainty to consumers when they check out and we give results to merchants. Both of those two things are a huge premium in a market like this.

I hear you talking about lowered credit delinquencies. Help me pair that with this. In the quarter, you saw a big rise in 0% interest loans. This is a strategy in which merchants can often subsidize borrowing costs to drive more sales. How is that scalable, especially in an environment where merchants are already having to take on the cost of increased tariffs?

It's a great question. I think we talk a lot about the consumer on forums like this, and we spend too little time talking about the merchants.And I really think that the merchants have spent a lot of time, have a lot of sympathy for merchants out there. They spent a lot of time dealing with a tremendous amount of volatility in their businesses over the past 4 years.In particular, the next 12 months, I think will be a real test. What's difficult for us to determine is how much of the volatility is, um, uh, something that you can, you can predict. Um, I think a lot of merchants right now are taking a conservative posture about where things will go because the the real world isn't good or bad, it's uncertain. I think that most merchants are just uncertain about where the future goes.But I think in those uncertain times they want the most efficient tools to drive conversion. I think the past 12 and

I'm so sorry we have to head back to the White House. The president is taking questions from reporters. Let's listen in to

go back up to 145%. No, but they would go up substantially higher, you know, at 145, you're really decoupling because nobody's going to buy.But they can go they got very high because of additional tariffs I applied during the course because of fentanyl and other things. But no, but they go substantially higher. I think you will have a deal. However, OK, you're confident that there will be a deal on Qatar. Has Qatar asked for anyAnything in exchange for that $400 million luxury jumbo jet and how can the American people be so sure that they will not in the future? Well, I think what happens with the plane is that, you know, we're very disappointed that it's taking Boeing so long to build a new Air Force One. You know, we have an Air Force One that's 40 years old, and if you take a look at that compared to the new plane of the equivalent, you know, stature at the time, it's not even the same ball game. You look at some of the.Uh, Arab countries and the planes they have parked alongside of the United States of America plane, it's like from a different planet and it's close to 40 years old, might be more than 40 years old now, and we, uh, when I first came in, I signed an order to get it built. Uh, I took it over from the Obama administration. Uh, they had originally agreed I got the price down much lower, uh, and then, uh.When the election didn't exactly work out the way that it should have, uh, a lot of work was not done on the plane because a lot of people didn't know they made change orders that were so stupid, so ridiculous, and it ended up being a total mess, a real mess, and when I came back, I said, by the way, what's going on with the, uh, the Boeings that are coming in? Well, sir, they're way behind and they are they're way behind they were way behind another mess that I inherited from Biden.And uh it's gonna be a while before we get them and uh I think Qatar who uh has really we've helped them a lot over the years in terms of security and safety. I felt that I think that and very, very nicely and I have a lot of respect for the leadership and for the leader Qatar and I think they very they knew about it because they buy Boeings they buy a lot of Boeings.Uh, and they knew about it and they said, uh, we would like to do something and if we can get a 747 as a contribution to our defense department, uh, to use during a couple of years while they're building the other ones, uh, I think that was a very nice gesture. Now I could be a stupid person and say, oh no, we don't want a free plane we give free things that we'll take one too.And it helps us out, uh, because again we're talking about we have 40 year old aircraft. The money we spend, the maintenance we spend on those planes to keep them tippy top is astronomical. You wouldn't even believe it. So I think it's a great gesture from Qatar. I appreciate it very much. Uh, I would never be one to turn down that kind of an offer. I mean, I could be a stupid person, say no, we don't want a free very expensive airplane.Uh, but it was, I thought it was a great gesture, and I think it was a gesture because of the fact that we have helped and continue to, we will, we will continue to, uh, all of those countries, Saudi Arabia, the UAE, uh, Qatar, and others, uh, we keep them safe. If it wasn't for us, they probably wouldn't exist right now, and I think this was just a gesture of good faith and, uh, I don't get it. Someday it'll be like Ronald Reagan they decommissioned them, you know, they get to a certain age they decommission them.Uh, it'll go to my library. They're talking about going to my library, uh, in years out, but, uh, I thought it was a great gesture, and it's something that was done by Ronald Reagan. They actually decommissioned the plane and he put it in his library and it actually has made the library, I think of Boeing 707, uh, it's actually made the library, uh, more successful, so it was good. Do you plan to use the plane?After you leave office, no, I don't. No, it would go directly to the library after I leave office. I, I wouldn't be using it, you said that the release of the American hostage Alexander is a step in good faith to end this war. Do you expect any progress in perhaps announced?On ceasefire during our trip we hope that we're going to have other hostages released too, as you know. So when I met with the hostages.

You're just listening to the president answering questions from reporters in the Oval Office. The president saying he does think that there will be a deal on China, but he would not raise the total China tariff back to.145%. This of course coming after Treasury Secretary Scott Besson earlier today saying it was implausible to think that China tariffs could go below 10%. So potentially we have our floor and our ceiling here of tariffs on China, the floor being 10%, the ceiling being 145%. We'll bring you more headlines from the White House as we get them. Much more ahead on Catalysts.

The biggest thing that came out of that meeting is they've agreed now we have to get it papered, but they've agreed to open up China. It's gonna be great for everybody.

President Trump Monday morning praising a breakthrough trade deal with China to temporarily reduce tariffs per the agreement, US tariffs on Chinese imports will fall to 30%, while Chinese tariffs on US goods will drop to 10% for the next 90 days. Joining me now, Bonnie Glazer, managing director of the German Marshall Fund's Indo-Pacific program. Bonnie, great to speak with you. Who won this round of negotiations, the US or China?

Well, I think the negotiations are just beginning. They are not over. There is no deal yet. The important outcome of the talks in Switzerland is the establishment of a what they're calling a consultation mechanism to talk about trade and economic issues.And I think that this opens the door to serious talks and negotiations between the two sides. What we see in terms of the temporary um tariff reduction.Uh, is similar of course to what the United States has done with other trading partners, uh, except that whereas for other trading partners they've dropped it to 10% for China they've dropped it to 30% and those additional 10 20% tariffs are related to the.That's why they were imposed and the Trump administration has attached very high priority to stopping the flow of chemical precursors that are used to make fentanyl from going to fentanyl and ending sorry, going to Mexico and ending up as fentanyl in the United States.

But Bonnie, which nation benefits more from the deal as it stands today amid the negotiations?

Well, it's been reported that the United States has gotten a, a reprieve on the restrictions of critical minerals and rare earths to the United States. I think that's a big win for the United States if that holds, because the United States is extremely dependent on, on China for uh those uh minerals.Uh, but then I think it's really a win for the peoples of both countries. I, I, I realize that's, that's not a direct answer to your question, but just restarting trade, we've seen over the last couple of weeks trade has just ground to a halt. The shipping containers aren't leaving China and we are about to see real shortages in the United States because of, uh, goods not arriving from China. So.It really is a win for the people of both sides if trade resumes and taking them down to 30% will, will, it will still increase costs, but the trade will resume. And

Bonnie, my guest host Kevin has a question for

you. Hey, Bonnie, I just wanted to get your sense, you know, outside of the past couple of days in the discussions that the US and China had in Switzerland, you know, what's your sense of, you know, China's overall kind of strategic footprint here and how things have changed since.Since the trade war 1.0, if you want to think about it that way, I mean, clearly the direct relationship in terms of US trade with China and imports directly from China that has come down, especially as a percentage of overall imports. We know a lot of that has been rerouted through other countries whether it's Vietnam or Cambodia or Thailand, but in the strengthening of relationships between China and those countries or China and South America, how do you think that China has a different set of cards this time, maybe more of an upper hand.

Well, China's relationship has definitely strengthened with many of the developing countries in Southeast Asia, Latin America, Africa, and there is transshipment of Chinese goods going through Vietnam and, and Malaysia in particular. Uh, the Trump administration is trying to shut down that transshipment and, uh, that issue has already been on the table as we know with uh with Vietnam.So China has been able to diversify some of its exports from the United States and to the United States and some of its imports, for, for example, the Chinese are now purchasing soybeans from Brazil um instead of from the United States. But at the end of the day, the United States is a hugely important market for China and the Chinese can maybe lessen the damage.But they can't eliminate the suffering that would occur if they're really blocked from access to the US market, and I think that that is not going to happen since both sides have said they don't want decoupling. So now we get down to the, you know, the details of a deal, and the devil is always in thedetails.

Yeah, well, on the importance of that relationship, you know, taking the other side of things, not just on the good.Deficit side, but looking at services which I argue often gets overlooked in all of this. I mean we have a massive surplus services surplus with China. So do you think that you know as these negotiations grind on, as we still have relatively high tariff rates on imports from China, what do you think the risk is, if any, if at all, to the services side of things in terms of Chinese demand for US services?

Well, uh, President Trump has talked about the market opening in China, and of course China has opened its uh financial services sector to some extent, uh, to the United States.So I don't think that the Chinese are going to be looking to take punitive actions against the services, uh, sector. Um, I think in fact the Chinese would like to eliminate to the extent possible, um, any of the restrictions, um, on trade that don't benefit them, right? I mean, that's they, they, they wanna make sure that they, that they preserve what is beneficial to China. And of course, even though you pay attention to services and we should all pay attention to the services.The Trump administration talks very little about it because that's where US advantages are. We do have a surplus with China, but the focus is on China's surplus with the United States and our negotiator Scott Besson has said it's 5 to 1 the goods that we sell, uh, that we buy from China compared to what that they buy from the United States. So

Bonnie, I'm looking for a one word answer here US or China, which gave more in this round of negotiations?

Sorry, it's just not over yet, so I don't think we can say who, who won and who gave more. It's a process.

Bonnie, thank you so much. I appreciate your time this morning. We're gonna have all your markets action ahead. You're watching Catalysts.Oil prices rising this morning while gold retreats after news the US and China have reached a temporary deal to remove reciprocal tariffs for 90 days while negotiations continue. Joining me now, Jeff Mayberry, double line portfolio manager, strategic commodity strategist, really appreciate you joining us this morning. Jeff, we are still below profitability levels for US shale oil producers. Where do we go from here on oil prices?

Yeah, I think it's interesting. Uh thanks for having me, and I think it's interesting that you've you've, you've hit on that point of, you know, shale producers have really cut back on their capital expenditures.And the market's pricing in less probability of a of a recession today. So I think you could see a pretty good bounce here in terms of oil prices on, you know, if we get a trade deal or if the trade deal continues that you could see the demand side continue to pick up and oil could could bounce from here, you know, probably doesn't get to, you know, a 70 handle or so, but really could see it in that kind of mid to high60s.

What's next for gold? Is that rally overdone at this point?

Well, it's interesting, gold has been, uh, you know, a lot of central bank buying, uh, but you really haven't seen too many retail, uh, too much retail buying in the, in the gold market yet. And so, you know, to the extent that people get a little bit more scared of a recession, uh, to the extent that they get a little bit more worried, you could see some more retail buying in gold, like the the retail ETF shares are below where they were 2022 and well, well below where they were in 2020.Uh, so I think that, uh, you could see, uh, uh, you know, a, a slight pause here in gold prices, but, um, if people get a little bit more scared, then you could see retail money get back into gold. They get scared of recession, especially, I mean, of inflation. You could see them really get back into gold, and you could see gold get up here, uh, to the high 3,000s, maybe even like a 4000 level on.

And my guest host Kevin has a questionfor you.

Hey Jeff, I just want to get your sense quickly on oil again, the dynamics of supply and demand in terms of what's going to be a bigger driver this year, especially as we try to figure out, as you try to figure out some sort of ceiling for Brent. How are you thinking about maybe supply dynamics being a little bit of a stronger force than demand at this point?

Right, I mean, you, you did see the OPEC plus come in. They, they raised their production or they, they reduce their cuts to production, uh, and, and there's only so much really they can do. Um, I think if you get, uh, you know, shale, US shale kind of being almost the marginal producer these days, uh, if you get prices up to like that $65 a barrel, then the, you know, the Kansas City Fed says that's the profitability line for, for US shale. And so I think you could see some more, uh.You know, more production there at a US shell, so that kind of puts the, um, you know, that's why I kind of say kind of high 60s as the ceiling because I think US production will continue or the supply will increase if we get above that $65 level from that WTI. So you know, brands at $65 so the pro called Brent like $70 at that point.

Jeff, thank you so much. Really appreciate it. Huge thank you to Kevin Gordon for joining me for the hour as well. Stick around for wealth coming up next.