Silver banana goes to…

In this issue of the peel:

• 📝 Markets remained flat as President Donald Trump announced that August 1st would be a hard deadline for country-specific tariffs.

• 📉 President Donald Trump also announced tariffs on copper products and significant tariffs on pharmaceuticals, potentially reaching as high as 200%. 

• 💸 Could the trade war make Southern India the next manufacturing center of the world?

Market Snapshot

Student Spotlight

A+ Equity Research Report 📊

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Banana Bits

• SpaceX executives are discussing raising money through selling insider shares, valuing the company at an impressive $400 billion. 

• Flash floods in central Texas were reported to have killed over 100 people, which is somewhat attributable to the lack of flood alarms in the area. 

• Copper futures have surged over 17% due to President Donald Trump’s 50% universal tariff on copper. 

• South Africa is planning its national budget around a 30% U.S. tariff, potentially indicating that they will not institute reciprocal tariffs.

• U.S. consumer debt increased in May at the slowest rate in the past 3 months.

• TopBuild to acquire Buy Progressive Roofing for a reported $810 million valuation.

The Daily Poll

Previous Poll:

What’s more important for the market right now?

EU-US trade deal: 19.2% // Tariff threats: 52.5% // Fed policy: 13.1% // Earnings season: 15.2%

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Macro Monkey Says

Markets Flatline as Tariff Pressures Continue

Yesterday, President Donald Trump announced that there would be “no extensions” beyond the August 1st date for country-specific tariffs. He also announced that there would be a 50% tariff on copper and a potential 200% tariff on pharmaceuticals. 

In response to the news, the major indices remained relatively flat, with the S&P barely in the negatives and the NASDAQ barely in the positives.

Despite earlier reports of progress, the U.S. and the European Union are struggling to reach a mutually beneficial trade deal, with the U.S. citing concerns regarding taxes and fines levied on targeting U.S.-based big tech firms. 

Trump also reported that he is “close” to sending the European Union a letter setting a unilateral tariff rate. Trump also later said that he is “probably two days off from sending them a letter.”

Additionally, Trump also announced that he would be implementing an additional 10% tariff on India for their participation in BRICS, a group of emerging countries. BRICS is an emerging markets coalition that includes countries like China, India, Russia, Indonesia, Brazil, and a few other countries. 

Trump announced an additional 10% tariff on any country within the BRICS coalition, as it represents a shift towards a non-Western economic power center, which threatens the dominance of the dollar. 

Trump also threatened pharmaceutical companies by saying that he would implement a 200% tariff on pharmaceutical companies that didn’t move production to the U.S. This policy would have a direct impact on big pharma companies like Pfizer and Johnson & Johnson, who both largely manufacture overseas in China and other markets. 

The Takeaway?

Trump’s newest tariffs, in addition to the August 1st deadline, could spell out short-term stock market volatility, or potentially delayed volatility until early August, depending on how negotiations play out. Furthermore, it will likely be extremely difficult, even borderline impossible, for big pharma to shift production to the U.S., which will be interesting to see unfold. 

Career Corner

Question

Any tips on how to get a fraternity group to like you if you're not part of a fraternity? I understand that this is a somewhat unusual question, but I was wondering if anyone has had any past experiences or insights into culture fit with summer internship programs.

Answer

Honestly, one of the worst things to do, in my opinion, is “force” a fit into a team for the summer; it will not come across as genuine and is even likely to backfire.

For the summer, remember that you are not yet part of the team; this is a 10-week interview process. Trying to be fratty, jump in on the jokes, etc, will usually not be taken well as you haven’t yet earned your spot.

Be respectful, put your head down and grind, ask questions, show humility, and a willingness to learn. Prove that you deserve the offer through hard work, great attitude, willingness to always take on more work, and learn from what you are given.

Head Mentor, WSO Academy

Check out WSO Academy!

What's Ripe

Progyny Inc. (PGNY) 13.2% 

• Progyny’s stock witnessed impressive gains yesterday after they expanded their 2025 financial projections, in addition to several banks increasing their price targets for the healthcare firm. Bank of America and Leerink Partners both changed their status for PGNY to overweight, with price targets of about $30, with the current share price being $24. 

SM Energy Company (SM) 9.8% 

• SM’s stock price rose yesterday after several banks upgraded their price targets for the energy firm, many of whom shifted their position to “strong buy” due to their current market valuation. SM also had a very successful Q1 with their earnings coming in above analyst expectations. 

What's Rotten

Sunrun Inc. (RUN) 11.4%

• Sunrun, a clean energy company, saw significant losses in their stock price yesterday after President Donald Trump announced that he would be eliminating wind and solar tax incentives within 45 daysx. This policy caused a broader selloff within the clean energy industry, and many banks lowered their price target for Sunrun. 

Hecla Mining Company (HL) 9.3%

• Hecla’s stock price fell substantially yesterday after several banks lowered their price target for the stock in conjunction with a bearish sentiment driven by investors as a result of their Q1 earnings miss. Banks that lowered their price target for Hecla include TD Securities, Roth Capital, and BMO Capital Markets. 

Thought Banana

India’s Shot at Manufacturing Glory?

Ever since the 1970s, China has been the global leader in manufacturing. In fact, China has such a strong hold on manufacturing that they are a primary reason for President Donald Trump’s sweeping tariffs, in addition to a lack of manufacturing in the States. 

Unfortunately for China, being bombarded with tariffs by the Trump Administration isn’t helping their monopolization of manufacturing, as many companies have already departed China as a result. 

While the U.S. isn’t necessarily the go-to alternative, many companies like Nike are shifting their production to other countries like Vietnam and India to avoid the inevitable cost of tariffs if they produce in China.

One of the primary reasons manufacturing shifted to China in the first place was the large labor force and low wages in the country. Now that companies are seeking the next best fit, India appears to be an appealing option for many countries.  

As displayed by the graphic, the low wages and robust labor force in India are likely quite appealing for companies exiting China due to overwhelming tariff costs. 

Southern Indian officials are even working alongside companies trying to establish manufacturing in India by accelerating infrastructure projects and providing tax incentives for incoming companies. 

Something else important to note about this entire situation is that India is currently part of BRICS, and President Donald Trump announced that any members of BRICS participating in “anti-American activities” would be hit with an additional 10% tariff.  

The Takeaway?

As many companies try to shift away from Chinese manufacturing, it is important to note that they will likely go for the most cost-effective option, which will definitely not be the U.S. in most cases. 

Additionally, India’s large and cheap labor force, coupled with their tax and infrastructure incentives, could make it a good fit for many companies. While India could hypothetically become the new manufacturing hub of the world, that is something that could only happen in the long term. 

The Big Question: Will Trump’s BRICS tariffs stall India’s manufacturing rise before it truly begins?

Banana Brain Teaser

Previous

X, Y, and Z each try independently to solve a problem. If their individual probabilities for success are 1/4, 1/2, and 5/8, respectively, what is the probability that X and Y, but not Z, will solve the problem?

Answer: 3/64

Today

In an electric circuit, two resistors with resistances x and y are connected in parallel. In this case, if r is the combined resistance of these two resistors, then the reciprocals of r is equal to the sum of the reciprcoals of x and y. What is r in terms of x and y?

Send your guesses to [email protected]

How Would You Rate Today's Peel?

Happy Investing,
Chris, Vyom, Ankit, Mithun, Colin & Patrick

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