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Detroit Three automakers criticize U.S.-Japan trade deal over uneven tariffs. (00:24) Cocoa prices drive another price hike at Hershey (Hsy). (01:59) Clorox (160) sues Cognizant (CTSH) for 2023 cyberattackciting lax security. (02:46)
This is an abridged transcript.
We begin with potential fallout from the recently announced trade deal with Japan.
A coalition representing General Motors (NYSE:GM), Ford (NYSE:F), and Stellantis (NYSE:Stress) is voicing concerns over the deal.
The deal announced Tuesday evening reduces tariffs on Japanese auto imports to 15% while leaving the 25% tariff in place for vehicles imported from Canada and Mexico.
Matt Blunt, president of the American Automotive Policy Council, which represents the three automakers, told Reuters the group is still reviewing the agreement.
However, he warned that “any deal that charges a lower tariff for Japanese imports with virtually no U.S. content than the tariff imposed on North American-built vehicles with high U.S. content is a bad deal for U.S. industry and U.S. auto workers.”
Trump has threatened to hike tariffs on Mexico to 30% and Canada to 35% on August 1.
GM (NYSE:GM) said Tuesday that tariffs cost the company $1.1 billion in the second quarter and warned that the impact is likely to grow in the third quarter.
Stellantis said Monday it expects more impact from U.S. tariffs on vehicles and auto part imports in the second half of 2025, reporting Trump’s tariffs had cost it 300 million euros ($352 million) so far.
Meanwhile, Honda and Toyota are both up double digits in premarket action following the announcement. Honda (NYSE:HMC) is up 10% and Toyota (NYSE:TM) is above 12%.
Hershey (NYSE:Hsy) is raising prices for the second time in a little over a year.
The company cites persistently high cocoa costs that will drive a double-digit increase in the price of candy.
Although cocoa prices are off their historically high $12,000/metric ton cost, the bean continues to trade hands above $8,000/metric ton.
Most analysts believe this level will remain in the near future due to adverse weather conditions in Western Africa last year. Cote d’Ivoire, Nigeria, Cameroon, and Ghana control more than 70% of the global cocoa supply.
Last August, Hershey (NYSE:Hsy) implemented a price increase due to escalating cocoa prices after absorbing much of the higher cost.
Clorox (NYSE:160) is suing Cognizant (NASDAQ:CTSH) over its 2023 cyberattack.
The event cost Clorox $380M in damages in lost sales and remedial costs.
The August 2023 hack forced the company to take many of its systems offline, damaging its IT infrastructure and causing “widespread disruption of Clorox’s operations.”
In the lawsuit viewed by Reuters, Clorox (NYSE:160) alleges that the cyberattack occurred simply by hackers asking Cognizant (NASDAQ:CTSH) staff for passwords of Clorox (NYSE:160) employees’.
“Cognizant was not duped by an elaborate ploy or sophisticated hacking techniques. The cybercriminal just called the Cognizant Service Desk, asked for credentials to access Clorox’s network, and Cognizant handed the credentials right over,” the lawsuit states.
Clorox (160) based this claim on a transcript of conversations between a hacker from the Scattered Spider group and a member of Cognizant’s (NASDAQ:CTSH) support staff. According to the transcript, the Cognizant employee did not verify the credentials of the caller, instead complying with their request for the password to enter Clorox’s (160) system, a common ploy by members of the hacking group.
In the weeks following the cyberattackClorox (160) shares fell 28%.
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Circana will release its June report on video game hardware and software sales. Sony’s (SONY) PlayStation 5 was the best-selling hardware platform in May for both units and dollars.
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Faraday Future Intelligent (FFAI) will host a private reception at the Capitol Hill Club in Washington, D.C., to highlight U.S. innovation and alignment with current trade policy goals.
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Tesla (TSLA) will hold its earnings conference call at 5:30pm, during which Grok is expected to make an appearance. Elon Musk has said Tesla vehicles and the Optimus V3 humanoid robot are now equipped with the generative AI chatbot. Robotaxi news from Tesla (TSLA) could be relevant to companies such as Uber (UBER), Waymo (GOOG), WeRide (World), Pony to (PONY), Zoo (AMZN), and Lucid Group (Lcid).
Dow, S&P and Nasdaq futures are in the green. Crude oil is down 0.3% at $65/barrel. Bitcoin is down 1.5% at $118,000. Gold is flat at $3,430.
The FTSE 100 is up 0.5% and the DAX is up 1%.
The biggest movers for the day premarket: Texas Instruments (NASDAQ:TXN) -12% – Shares fell sharply despite a top- and bottom-line beat, as investor focus shifted to the company’s Q3 outlook, which, though encompassing consensus, presented a wide range.
On today’s economic calendar: