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Good morning and happy Monday.
There are those who run away from danger and those who heroically run toward it. And then there’s Zoox, the Amazon-made robotaxi that hasn’t recognized it soon enough.
The tech behemoth has ordered a recall on more than 100 of the self-driving cars after one of them failed to detect heavy smoke and drove straight into an active emergency fire scene in Las Vegas last month. There were no passengers inside and no injuries occurred, and the vehicle eventually left the scene with guidance from a remote Zoox employee, the company wrote in a report. The recall comes just after the National Highway Traffic Safety Administration urged robotaxi developers to make sure their fleets can adequately detect first responders, citing a “clear pattern” of incidents. To paraphrase the old Mr. Rogers quote: In times of crisis, look for the helpers … then look both ways for the robotaxis.
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New tariffs, same old story.
US retailers have spent the summer importing as many goods as possible to capitalize on a small window of time before a new batch of tariffs that are expected next month, driving shipments toward a record in July. It’s the same playbook the industry ran last year to beat wide-ranging levies imposed by the White House that were later overruled by the Supreme Court.
Tariff Timeline
When SCOTUS determined in February that the president lacks the authority to levy unilateral import taxes under the International Emergency Economic Powers Act, the White House responded by imposing a new batch of tariffs under a different law, Section 122 of the Trade Act of 1974. The Trump administration said the temporary 10% blanket tariff was needed to address “large and serious balance-of-payments deficits.” America’s old importing habits die hard, though, and the US trade deficit surged to $77 billion in May, the highest in 14 months, according to the Commerce Department.
With the Section 122 tariffs due to expire this week, the White House has already lined up its next tariff stopgap. Last month, the US Trade Representative said a different clause in the Trade Act of 1974, Section 301, allows it to impose tariffs of up to 12.5% on 60 different countries it says have failed to curb trade in goods made with forced labor. (Some countries have disputed the charge.)
To protect their profit margins, retailers are racing to obtain inventory needed later in the year:
- Imports in June are expected to have reached 2.33 million TEUs (that’s 20-foot equivalent shipping container units), according to a Global Port Tracker report from the National Retail Federation and Hackett Associates. That would be more than an 18% year-over-year increase.
- It follows 2.24 million TEUs in May, a roughly 15% surge. July is expected to draw 2.47 million TEUs, according to the tracker, beating a monthly record previously set in May 2022.
  RefundMe: In the meantime, retailers are losing some of their potential tariff savings to heightened shipping costs. Spot shipping rates from Shanghai to New York City climbed 74% year over year last week and surged more than 120% from Shanghai to Los Angeles, according to maritime consultancy Drewry’s World Container Index. Retailers have a bit of a buffer, however: the refunds from overturned Liberation Day tariffs rejected by the Supreme Court. Customs officials have already certified $71 billion in refunds, which includes interest, according to a court filing recently spotted by Axios, and are processing more than $100 billion in refunds altogether.
Written by Brian Boyle
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Photo via Registered Agents Inc.
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After a welcome pause in hostility and volatility, war has put crude oil back on slick footing.
Last week, international benchmark Brent crude rose 13.5% to $88 per barrel, marking its biggest weekly jump since April. This morning, the average price of a gallon of gas in the US crossed the $4 threshold. The breakdown of a ceasefire between the US and Iran led to a precipitous shutdown of the Strait of Hormuz, just as shipping traffic through the world’s most crucial energy chokepoint had restarted after a months-long hiatus.
Double Jeopardy
President Donald Trump declared the ceasefire, memorialized in a June 17 memorandum of understanding, to be “over” on July 8, one day after the US military said Iran struck three ships in the Strait and the US retaliated. Trump left the door open to negotiations, but last week marked the return of wider hostilities that had driven oil prices to $126 a barrel in April. To make matters worse, some experts fear the re-escalation could be harder on energy markets than the first time around.
The International Monetary Fund said last week that oil prices proved relatively resilient in the spring, avoiding doomsday $200-per-barrel forecasts and falling close to pre-war levels in early July, because of three key factors. Higher prices led to a decrease in demand, especially in Asia. Production outside the Persian Gulf, 2 million barrels a day higher than 2025 levels, rose faster than expected. And, finally, the release of commercial inventories and strategic reserves, now depleted, eased the supply shortfall. Now, the agency warned, the global economy is in a much weaker position:
- “What cushioned the initial blow this time is that energy markets had room to maneuver and absorb it,” wrote IMF economists Azim Sadikov and Jean-Marc Natal. “As tensions flare again in the Strait of Hormuz, that room is now smaller and shrinking further as spare capacity has been deployed, demand has compressed, and inventories have been drawn down.”
- They noted that over 1.1 billion barrels of crude, equal to roughly 10 days of typical global consumption, hadn’t reached the market because of the conflict as of late May. This, they said, represented a bigger disruption than the 1973 oil shock, the Iran-Iraq war and the Gulf War at the same stage of disruption.
Growth Watch: The IMF projected world economic growth will narrow to 3% this year, down from the 3.1% projected in April, and warned there’s room for further downgrades if conflict continues.
Written by Sean Craig
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Photo via Betterment
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Starships were meant to fly, in the wise words of Nicki Minaj. But SpaceX’s Starship rocket stayed grounded last week as the company’s stock crashed down around CEO Elon Musk.
Investors were turning bearish on Musk’s space company even before last week’s scrubbed launch, wiping out about $1 trillion in market value since the stock’s June 16 peak. SpaceX’s shares closed out the week trading about $124, below the company’s $135 IPO price last month. Musk, who’s the company’s biggest shareholder with about a 46% stake, saw his net worth plummet below the trillion mark. But don’t start playing a tiny violin just yet: He’s still the world’s richest person.
Coming Down to Earth
SpaceX’s June 12 IPO was the largest in history, with the moonward-bound company raising more than $85 billion. The stock surged as investors fought over the first public shares of a company that had stayed private for 24 years. But not long after, SpaceX lost its forward thrust:
- Only about 5% of SpaceX’s 13 billion outstanding shares were available for the public to trade at the time of its IPO. Out of its tradeable shares, about 185 million are being sold short, according to S3 Partners, up from just about 40 million a few weeks ago. That means about 29%, or $25 billion worth, of SpaceX’s shares are pinned to bets that the company will keep trending down.
- It’s a sensitive time for investors to turn sour, with SpaceX floating more of its shares as lockups gradually expire. KeyBanc Capital Markets estimated that the first unlock might be timed alongside the company’s second-quarter earnings call, which hasn’t been scheduled yet.
It’s a Musk Have: When SpaceX shares its first earnings report as a public company, Musk will be faced with the tall task of carefully framing its continued losses. SpaceX doesn’t expect to turn a profit until 2027. Playing it safe with a focus on the growing Starlink biz, the company’s only profitable unit, might put investors at ease. Still, this is Elon Musk, and he has a track record of driving hype with out-there plans like Tesla’s Optimus robot. So talking about building a civilization on Mars isn’t off the table.
Written by Jamie Wilde
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- Reality Check: Corporate insiders are dumping shares at a near-record rate, suggesting they may not be terribly confident in markets.
- Rent It Is, Then: Buying a house became less affordable for the fifth month in a row in June, with a median single-family home requiring an income of $109,152 and a 20% down payment.
- You Already Rely on Your Inbox for Your Morning News. Join 200,000+ investors who trust Opening Bell Daily for their pre-market newsletter covering stocks, investment ideas and the data moving your portfolio. Subscribe for free.**
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