Key Takeaways
- The United States has confirmed it will not impose tariffs on Malaysian palm oil, cocoa, rubber, pharmaceuticals, and semiconductors, as announced by Malaysian Finance Minister Zafrul.
- UK manufacturing activity contracted further in July, with the S&P Global Manufacturing PMI falling to 48.0, below preliminary estimates, indicating ongoing economic headwinds.
- China and the United States engaged in focused discussions on economic and trade ties, with the People's Bank of China (PBoC) inviting US companies and financial institutions to invest in the Chinese market.
- Manufacturing PMIs across the Eurozone and Germany also remained in contractionary territory in July, reinforcing concerns about regional economic growth.
Significant developments in global trade relations and manufacturing data emerged today, with the United States confirming key tariff exemptions for Malaysia while manufacturing activity in the UK and Eurozone continued to contract. Meanwhile, high-level economic discussions between China and the US signal ongoing efforts to stabilize bilateral ties.
In a notable trade development, Malaysian Finance Minister Zafrul announced that the United States will not impose tariffs on Malaysian palm oil, cocoa, and rubber. This positive news for Malaysia's key export sectors was further bolstered by confirmation that pharmaceuticals and semiconductors from Malaysia will also be exempt from U.S. tariffs. Despite these exemptions, Malaysia's Trade Minister clarified that there was no deal or request to provide rare earths exclusively to the U.S. during the tariff negotiations, with a joint statement on tariffs between the two nations expected this weekend. Similarly, Swiss authorities have confirmed that a 39% tariff rate does not apply to pharmaceuticals, according to a spokesperson from the Swiss Economy Ministry.
Separately, China and the United States held focused talks on economic and trade ties, with both sides engaging in detailed discussions to address trade and economic issues. The People's Bank of China (PBoC) Deputy Governor met with a US business delegation on July 29, and China extended an invitation to US companies and financial institutions to invest in its market, signaling a push for greater economic cooperation.
Economic data released today painted a challenging picture for European manufacturing. The UK S&P Global Manufacturing PMI for July finalized at 48.0, a slight revision downwards from the preliminary 48.2 and indicating a continued contraction in the sector. This figure underscores persistent weakness in the UK's industrial output.
The manufacturing downturn was not limited to the UK. The Eurozone HCOB Manufacturing PMI for July finalized at 49.8, aligning with preliminary estimates but still indicating a slight contraction in the region's manufacturing activity. Germany, a key economic engine within the Eurozone, also saw its HCOB Manufacturing PMI for July finalize at 49.1, slightly below the estimated 49.2, further highlighting the broader manufacturing slowdown across Europe.
In company-specific news, Tesla's (TSLA) car registrations in Norway surged by 83.4% in July compared to the previous year, according to recent registration data. This significant increase points to strong demand for the electric vehicle manufacturer's products in the Norwegian market.
Finally, the EU Court ruled that classifying a third country as a "safe country of origin" must be open to proper judicial review, a decision that could have implications for asylum and immigration policies across the bloc.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.