Breakfast News: Tariffs Target Brazil

Source: Image Created by Jester AI.

1. Brazil Tariffs Soar; E.U. Next for Trump

President Donald Trump has stepped up his trade policy stance, increasing the tariff rate on Brazil from 10% to 50%, effective Aug. 1, while announcing he would probably inform the E.U. what levy rate to expect within the next two days.

• Total two-way trade with Brazil of $92 billion in 2024: Brazil is the 15th largest U.S. trading partner, but importantly, the U.S. has a rare $7.4 billion trade surplus. Some have flagged the tariff as being more politically motivated than economic.
• "I hope to reach a satisfactory conclusion, potentially even in the coming days." E.U. Trade Chief Maros Sefcovic said progress is being made in trade talks, but an imminent letter from the president could provide fresh impetus.

2. Amazon Eyes Deeper Anthropic Tie

Amazon (NASDAQ:AMZN) is mulling another multibillion-dollar investment in Anthropic, as it seeks to help commercialize artificial intelligence (AI) products and deepen the existing alliance to ward off competition.

• "We quickly realised that we had many shared goals that were fundamentally critical." Amazon has already invested $8 billion in the AI start-up, with Dan Grossman, vice president of worldwide corporate development, stating that this reflects the ambition Amazon has in helping Anthropic grow.
• A mutually beneficial relationship: Investing more allows Amazon to remain one of the largest shareholders and fosters further collaboration on data center projects, while providing capital for Anthropic to develop better AI models.

3. TSM Revenue Beat Signals Further AI Rally

Taiwan Semiconductor Manufacturing (NYSE:TSM) reported a 39% increase in revenue for the quarter ending in June, beating expectations and highlighting the continued AI spending trend.

• Full Q2 earnings due July 17: The monthly revenue update comes a week ahead of the full financial report, which will include a more detailed outlook for the rest of the year.
• Nvidia hits $4 trillion market cap: The TSM revenue beat supports the growing view of the AI rally being far from over, something further highlighted by Nvidia (NASDAQ:NVDA) becoming the first company to achieve a $4 trillion valuation.

4. Alphabet's Chrome Under AI Browser Threat

Reuters reports that Alphabet's (NASDAQ:GOOG) Chrome could be under fire, as OpenAI is close to releasing an AI-powered web browser, aiming to fundamentally change how users navigate the web.

• Strong base of 500 million weekly active users: OpenAI's ChatGPT already boasts an impressive reach, with the new browser designed to keep some user interactions within the existing interface instead of clicking through to websites.
• Alphabet's ad revenue contributes three quarters of total pot: The Chrome browser is a key driver of ad money for Alphabet, along with providing access to user data. Any loss of traffic could be detrimental to the business.

5. Your Take

Which two peers do you believe can outperform Walmart (NYSE:WMT) over the next five years and why? Debate with friends and family, or become a member to hear what your fellow Fools are saying. Sorry, Amazon isn't eligible on this occasion!