Spain Could Ruin The EU-US Trade Negotiations

 By Philip Marey, Senior US strategist at Rabobank

Yesterday, the US dollar was under pressure - with EUR/USD peaking at 1.1744 - as speculation about Fed rate cuts increased after comments by Trump and reports in the media that he is considering nominating the next Fed Chair in the coming months. An early nomination could make the nominee the “de facto shadow chair” as his comments (only men are reported to be on the shortlist) would carry a lot of weight in the markets regarding monetary policy beyond May 2026 when Powell’s term expires. For more details on Powell’s succession and the concept of a shadow chair, see our article in International Banker from a few months ago. Meanwhile, there was more pushback against a July rate cut by several Fed speakers yesterday, specifically Daly, Collins, Barkin and Goolsbee.

One day after the NATO summit in The Hague, European leaders met in Brussels again. Now that President Trump has made a clear connection between NATO policy and trade negotiations, European leaders think they have earned trade concessions from the US for their increased contributions to NATO. A major problem is Spain which is not willing to help defend Europe by spending 5% of GDP, but it expects the EU to protect it from US tariffs. Whether other EU countries are happy with this double free riding remains to be seen. They just assigned a lot of money appeasing President Trump (and defending Europe from Russia) but Spain could ruin the EU-US trade negotiations. Yesterday, European leaders discussed trade concessions to the US, including lowering tariffs, reducing non-tariff barriers, buying more US products including LNG, and cooperating with the US to tackle its economic concerns with China.

In other trade news, US Commerce Secretary Howard Lutnick said that a trade “deal” with China had been signed two days ago, although this appears to be essentially the truce reached last month in Geneva. He added that there are imminent plans to reach agreements with 10 major trading partners.

Meanwhile, the spinning of the Fordow attack is in full force on both sides. While the White House maintains that the nuclear facility was obliterated, Iran is downplaying the impact and both sides claim victory. Defense Secretary Pete Hegseth and Joint Chiefs Chairman Dan Caine gave a joint press conference providing more details about the air strike, but they offered no new evidence about the effectiveness of the attack.

Yesterday, the Senate Committee on Finance issued a statement that the proposed introduction of Section 899 to the Internal Revenue Code would be removed from the One Big Beautiful Bill because of a forthcoming international tax agreement announced by Treasury Secretary Scott Bessent. Section 899 would have introduced retaliatory taxes on foreign companies from countries that impose “unfair taxes” on US companies, such as undertaxed profits rules, digital services taxes, and diverted profits taxes.

“We applaud President Trump and his team for protecting the interests of American workers and businesses after years of congressional Republicans sounding the alarm on the Biden Administration’s unilateral global tax surrender under Pillar 2.  Reaching a joint understanding with the G7 means the U.S. can reclaim tens of billions of dollars that had been ceded from our tax base by Democrats’ America-Last policy. At the request of Secretary Bessent and in light of this joint understanding to preserve U.S. tax sovereignty and allow U.S. tax laws to co-exist with the Pillar 2 regime, we will remove proposed tax code Section 899 from the One Big Beautiful Bill Act, and we look forward to active engagement with Treasury on these important issues. We are committed to restoring Americans’ confidence in our representative government by putting America first.  Congressional Republicans stand ready to take immediate action if the other parties walk away from this deal or slow walk its implementation.”

The last sentence of the statement can be seen as a threat to foreign governments that the US Congress could still adopt Section 899 if the new international tax agreement is violated.

Meanwhile, progress of the One Big Beautiful Bill in the Senate was dealt a blow by the Senate parliamentarian. The Senate’s rules arbiter decided that several spending cuts proposed in the bill did not qualify for the reconciliation process that allows the bill to be passed with a simple majority. Republicans hope to remedy this by changing the wording and are still sticking to their self-imposed July 4 deadline to get the bill to President Trump’s desk. However, if the Senate parliamentarian is not going to be convinced, they may have to drop these spending cuts which would make it harder to reach their budget targets and meet the Independence Day deadline.

Day Ahead

In politics, the US Senate intended to start voting today on the One Big Beautiful Bill. However, this could be delayed by the procedural clash with the Senate parliamentarian. Over a month ago, the House of Representatives passed its version with a narrow 215-214 vote. When it comes to a vote, the margins in the Senate are also small. There are 53 Republican senators, but libertarian Rand Paul is expected to vote no because of the debt limit increase included in the bill. Other fiscal hawks, in particular Ron Johnson, Rick Scott, and Mike Lee are demanding more savings in the bill, such as bigger spending cuts and a faster expiration of clean-energy tax credits. However, this is a difficult balancing act for Senate Majority Leader John Thune because at the other end of the Republican spectrum, the “Medicaid moderates”, in particular Thom Tillis, Josh Hawley and Susan Collins think the bill’s Medicaid cuts are too deep. Lisa Murkowski, Jerry Moran and Jim Justice are also considered to be part of this group. Meanwhile, there is disagreement about the increase in the cap (to $40,000) on how much taxpayers can deduct from the amount they owe in federal taxes state and local taxes (SALT). This was negotiated by House Republicans from high tax states, such as California, New Jersey and New York. However, many Republican senators want to keep this at the level of the TCJA ($10,000).

Once the Senate has passed its version, the House could accept the adjusted version early next week and send the bill to President Trump who can then sign it into law by July 4, or reject it. However, the self-imposed Independence Day deadline is symbolic and there is no X-date until August at the earliest and the fiscal cliff from the income tax provisions in the Tax Cuts and Jobs Act is at end of the year. So a modest delay would have no major consequences other than ruining Trump’s good mood after getting the royal treatment at the NATO summit in The Hague.

https://www.zerohedge.com/markets/spain-could-ruin-eu-us-trade-negotiations

Nestle To Stop Using Artificial Dyes By Mid-2026

 It's another resounding success for the MAHA movement that has left us thinking why on Earth were these steps not taken any sooner. And of course, we know the answer: the food lobby that RFK and his administration has been hell bent on not taking their cues from. 

Nestlé announced Wednesday it will remove artificial colors from its U.S. food and beverage products by mid-2026, according to CBS.

“We are always looking for different ways to offer great tasting, compelling choices for our consumers. As their diverse dietary preferences and nutritional needs evolve, we evolve with them,” said Nestlé U.S. CEO Marty Thompson. “Serving and delighting people is at the heart of everything we do and every decision that we make,” he added.

The company said it has gradually eliminated synthetic dyes over the past decade, with 90% of its U.S. portfolio already dye-free. However, some products like Nesquik Banana Strawberry milk still contain Red 3.

Nestlé previously pledged to remove artificial dyes in 2015 but did not fully follow through.

CBS writes that other major food companies are making similar moves. Kraft Heinz and General Mills both announced plans last week to eliminate artificial dyes from U.S. products by 2027. General Mills also aims to remove them from cereals and all K–12 school foods by mid-2026.

Public and regulatory pressure is growing. A recent AP-NORC poll shows about two-thirds of Americans support removing dyes and added sugars from processed foods. California and West Virginia have banned artificial dyes in school meals, and Texas will require a new warning label starting in 2027 for foods with ingredients "not recommended for human consumption" in Australia, Canada, the EU, or the U.K.

Federal oversight is increasing as well. In January, just before President Trump took office, Red 3 was banned from food due to cancer concerns. In April, Health Secretary Robert F. Kennedy Jr. and FDA Commissioner Marty Makary said the agency would seek to phase out synthetic dyes by the end of 2026, relying largely on voluntary action from the food industry.

https://www.zerohedge.com/markets/nestle-stop-using-artificial-dyes-mid-2026

Loonie Tumbles As Trump Suddenly 'Terminates' All Trade Talks With Canada

 US stocks and the Canadian dollar are sliding after President Trump announces on TruthSocial that the US is terminating all trade discussions with his northern neighbor due to Carney putting a tax on US tech firms (like Europe):

"We have just been informed that Canada, a very difficult Country to TRADE with, including the fact that they have charged our Farmers as much as 400% Tariffs, for years, on Dairy Products, has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country.

They are obviously copying the European Union, which has done the same thing, and is currently under discussion with us, also.

Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately.

We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period. Thank you for your attention to this matter!"

The reaction was swift and saw the loonie dumped...

...and US stocks rolled over...

The Canadian digital services tax, which is similar to one implemented by some other countries including the UK, is equal to 3% of the digital services revenue that a firm makes from Canadian users above C$20 million ($14.6 million) in a year.

It would apply to companies including Meta Platforms and Alphabet.

However, Canadian Finance Minister Francois-Philippe Champagne suggested to reporters last week that the digital tax may be renegotiated as part of US-Canada trade discussions.

“Obviously, all of that is something that we’re considering as part of broader discussions that you may have,” he said.

Seems a little short-sighted given the Canadian trade flow...

Well the negotiation is on now!

https://www.zerohedge.com/geopolitical/loonie-tumbles-trump-suddenly-terminates-all-trade-talks-canada

Eupraxia started by Wainwright

 at Buy.

https://finviz.com/quote.ashx?t=EPRX&p=d

Citius Oncology Anticipates Commercial Launch of LYMPHIR™ in 2025

 Citius Oncology, Inc. ("Citius Oncology") (Nasdaq: CTOR), the oncology-focused subsidiary of Citius Pharmaceuticals, Inc. ("Citius Pharma") (Nasdaq: CTXR), today announced that preparations for the commercial launch of LYMPHIR™, an FDA-approved immunotherapy for the treatment of adults with relapsed or refractory cutaneous T-cell lymphoma (CTCL), are nearing completion. The Company believes it is now operationally positioned to transition from a development-stage enterprise to a fully integrated commercial organization, with all major launch-enabling activities underway. Final preparations are in process for a U.S. launch of LYMPHIR in the second half of 2025.

https://www.prnewswire.com/news-releases/citius-oncology-anticipates-commercial-launch-of-lymphir-in-2025-302482826.html

Chinese Influence In Climate Change Lawsuits Threatens To Derail U.S. Energy Industry

 A new op-ed from oil services CEO Dan Eberhart in Forbes makes the case that climate change litigation is a growing threat to U.S. energy - and that the U.S. could fall behind China as a result.

He notes that Senator Ted Cruz has repeatedly voiced concern that American energy security is under threat—not from foreign armies or economic collapse, but from a coordinated legal campaign masquerading as environmental activism. This week, Cruz’s Judiciary oversight subcommittee is convening a hearing to dig into what he believes is a coordinated effort between China and the U.S. climate litigation movement aimed at undercutting U.S. energy dominance.

According to Eberhart's piece in Forbes, the wave of climate lawsuits, particularly those brought by firms like Sher Edling, are supported by a network of well-funded foundations and advocacy organizations. These entities, he argues, may be unintentionally serving the strategic goals of America's geopolitical adversaries—especially China—by hampering domestic fossil fuel production and increasing reliance on foreign-controlled clean energy supply chains.

Eberhart points out that China already dominates global markets for critical materials like lithium and cobalt, as well as solar and battery manufacturing. So, any U.S. policy that accelerates a transition away from fossil fuels without securing domestic al

The national security implications are becoming harder to ignore. The U.S.-China Economic and Security Review Commission has raised alarms that the Chinese Communist Party is working to influence U.S. state and local policy to advance its global agenda. A report from the nonprofit State Armor further claims that China has infiltrated segments of the American environmental movement to steer energy policy in a way that aligns with Chinese interests.

One organization receiving particular scrutiny is the Energy Foundation China (EFC). Though it’s officially based in San Francisco, most of its staff are located in Beijing, and its activities reportedly align closely with CCP goals. Eberhart notes that EFC has funneled millions into U.S. anti-fossil fuel groups, including the Rocky Mountain Institute and the Natural Resources Defense Council (NRDC)—the latter of which faced a 2018 congressional inquiry over potential foreign agent registration.

Concerns about Chinese influence don’t stop with advocacy groups. The House Energy and Commerce Committee has previously warned that Beijing is exploiting social and political divisions in America to steer energy policy in its favor. Several major U.S. philanthropic institutions—including the Rockefeller, Hewlett, and MacArthur foundations—have funded environmental litigation efforts that Eberhart believes would never have gained traction without their financial support. However, these donors have largely ignored the risks of foreign manipulation embedded in the groups they help fund.

The influence campaign, Eberhart claims, also extends into academia. Chinese government-affiliated institutions like the National Natural Science Foundation of China have published research in U.S. journals criticizing fossil fuels and painting American companies as deceptive. Notably, one of EFC’s top communications staffers once worked at this same Chinese foundation.

Meanwhile, what Eberhart calls a “revolving door” between activist nonprofits and federal agencies raises further ethical concerns. For instance, Ann Carlson, now serving in the Biden administration, previously consulted for Sher Edling while also sitting on the board of the Environmental Law Institute—a group that has partnered with Chinese organizations on legal education initiatives tied to climate litigation.

Eberhart argues that the Senate subcommittee led by Sen. Cruz is uniquely positioned to investigate the network of foreign and domestic actors behind the legal assault on American energy. Transparency, he writes, is crucial. Americans deserve to know who is funding these lawsuits and why. Otherwise, he warns, efforts to revive the “energy dominance” doctrine promoted during the Trump administration may not be enough to overcome what he sees as an opaque and potentially dangerous campaign.

While the U.S. debates and litigates its energy future, Eberhart cautions, China is rapidly building coal plants, securing fossil fuel deals, and tightening its grip on clean energy supply chains. If current trends continue, Beijing may find itself in a commanding position—while the U.S. energy sector is entangled in regulation, litigation, and foreign dependency.

It's almost as if all of this progressive "activism" really was put in place to set us in motion backwards...

https://www.zerohedge.com/markets/chinese-influence-climate-change-lawsuits-threatens-derail-us-energy-industry

J.M. Smucker to remove artificial food dyes by end-2027

 Jif peanut butter maker J.M. Smucker said on Thursday it would remove synthetic food colors from all consumer food products by the end of 2027.

The company said this move would impact its sugar-free fruit spreads, ice cream toppings as well as some sweet baked goods from its Hostess brand portfolio.

J.M. Smucker said majority of its products currently available to K-12 schools do not contain any artificial colors, and is working with distribution partners to stop selling products with synthetic dyes to K-12 schools by the 2026-2027 school year.

Packaged food makers, including Conagra Brands (NYSE:CAG) and General Mills (NYSE:GIS), have been committing to eliminate the use of artificial colors from their product categories as they align themselves with the plans of Health Secretary Robert F. Kennedy Jr. to remove synthetic food dyes from the U.S. food supply.

Earlier this month, Kraft Heinz (NASDAQ:KHC) also said it would stop launching new products containing artificial colors in the U.S. and plans to remove synthetic dyes from existing items by the end of 2027.

https://www.investing.com/news/economy-news/jm-smucker-to-remove-artificial-food-dyes-by-end2027-4113781