Core Viewpoint - The U.S. Supreme Court's ruling to overturn Trump's emergency tariffs could lead to refunds of approximately $175 billion in tariffs, significantly impacting businesses and consumers, although the refund process is expected to be slow [1]. Group 1: Impact on Businesses - Thousands of businesses are now considering pursuing refunds due to the Supreme Court ruling, which affects not only those that sued but also a broader range of companies [1]. - Affected companies, including luxury brands like LVMH and Moncler, saw positive stock reactions following the ruling [1]. - The corporate sector, particularly in consumer goods, automotive, manufacturing, and apparel, has been heavily impacted by tariffs that increased costs and disrupted supply chains [1]. Group 2: Refund Process and Legal Actions - The refund process is anticipated to be lengthy, with many companies potentially waiting months to years to recoup tariffs [1]. - Over 1,800 tariff-related lawsuits have been filed since April, a significant increase from fewer than two dozen in 2024, indicating a growing trend of legal challenges against tariffs [1]. - Companies may face challenges in gathering detailed import data necessary for calculating tariffs paid under various regimes [1]. Group 3: Consumer Impact - The Federal Reserve Bank of New York reported that 90% of the costs from Trump's tariffs are borne by American consumers and companies, countering the argument that foreign entities bear the burden [1]. - The effective U.S. tariff rate was reported at 11.7% as of November, significantly higher than the average of 2.7% between 2022 and 2024 [1]. Group 4: Future Tariff Landscape - Despite the ruling, tariffs are expected to continue under different legal frameworks, particularly in sectors deemed crucial for national security [1]. - The automotive sector will still face significant tariffs not related to the overturned emergency powers, such as the 25% tariffs on vehicles from Mexico and Canada [1]. - Some companies are opting to sell their rights to collect refunds to outside investors, receiving a small upfront payment while forfeiting the remainder [1].

Core Viewpoint - Luxury companies like LVMH and Kering are facing significant volatility in their stock prices due to hedge fund positioning and concerns over AI-related market fluctuations, as they attempt to recover from a two-year slowdown in sales [2][3][8]. Group 1: Company Performance - LVMH, the largest luxury group with a market cap of €260 billion ($308.49 billion), experienced its largest one-day stock drop since 2020 after CEO Bernard Arnault expressed caution about future growth, which contrasted with a previous 12% increase following an optimistic market update in October [4][10]. - Kering's shares rose by 11% after reporting fourth-quarter revenue that fell slightly less than expected, with new CEO Luca de Meo indicating "early, fragile" signs of recovery [6][11]. - Hermes, known for its Birkin bags, saw a modest 2.5% increase in shares despite a solid quarter, trading at 45 times forward earnings, more than double that of LVMH [11]. Group 2: Market Dynamics - The luxury sector is experiencing heightened volatility due to a high number of short positions taken by hedge funds, which can lead to significant price swings when unexpected results are announced [5][8]. - The luxury market's dependence on affluent consumer spending makes it particularly sensitive to fluctuations in the U.S. stock market, which is currently experiencing volatility driven by AI trends [8][9]. - Hedge funds are increasingly influencing market movements, with many trading based on news and data points, which can exacerbate price volatility in luxury stocks [7][10]. Group 3: Investor Sentiment - Investors are actively switching their bets among luxury brands, looking for potential turnaround stories as the sector navigates a slow recovery [11]. - Kering's CEO has highlighted the stock market as a key indicator of luxury spending in the U.S., warning that a correction in the AI market could negatively impact European luxury groups [9]. - The current market environment is characterized by nervousness among investors, with many seeking to sell amid high valuations and concentrated market conditions [10].

Group 1 - UBS has raised the target price for Hermès International from €2260 to €2310 [1]

Group 1: AI and Technology Sector - European stocks are opening cautiously due to skepticism about returns on AI infrastructure investments [1] - OpenAI has alerted U.S. lawmakers about Chinese startup DeepSeek using advanced techniques to replicate AI model behavior [1] - Microsoft AI head stated that most computer-based roles could be automated within 12-18 months as the company pushes for "professional-grade AGI" [2] - Cisco Systems provided a weaker-than-expected profitability forecast, indicating that higher memory-chip prices are impacting its performance [6] Group 2: Automotive and Electric Vehicle Industry - Rivian Automotive exceeded fourth-quarter expectations and aims for a significant increase in vehicle deliveries this year [3] Group 3: Economic Indicators and Market Reactions - U.S. stocks fell as concerns grew over AI's potential impact on revenues and profit margins across various sectors, including financial and commercial real estate [6] - Treasury yields reached two-month lows as first-time unemployment claims decreased less than expected and existing home sales hit a two-year low [7] - The tech-heavy Nasdaq Composite dropped by 2%, the S&P 500 fell by 1.6%, and the Dow declined by 1.3% [7] Group 4: Commodity Markets - Gold prices rose over 1% after a previous decline of 3%, influenced by diminishing hopes for Federal Reserve rate cuts [5] - Oil prices continued to decline, pressured by a bearish outlook from the International Energy Agency and prolonged diplomatic talks between the U.S. and Iran [5]

Core Viewpoint - Hermes International SCA is a leading luxury brand known for its high-end products and strong market position, despite a slight earnings miss in its latest report [1][2]. Financial Performance - On February 12, 2026, Hermes reported earnings per share (EPS) of $2.57, slightly below the estimated $2.59, while achieving a revenue of approximately $9.22 billion, reflecting a 9.8% increase for the fourth quarter [2]. - Strong sales in the United States and Japan contributed to the revenue growth, aligning with market expectations [2]. Market Valuation - Hermes has a price-to-earnings (P/E) ratio of approximately 51.18, indicating strong investor confidence in the company's future growth prospects despite the slight EPS miss [3]. - The price-to-sales ratio is about 14.58, and the enterprise value to sales ratio is around 14.06, illustrating the premium investors place on Hermes' sales [4]. Financial Stability - The company maintains a conservative capital structure with a low debt-to-equity ratio of 0.12, suggesting limited reliance on debt [5]. - Hermes has a strong current ratio of 4.50, indicating robust short-term financial health and the ability to cover current liabilities with current assets [5].

Core Viewpoint - The outlook for European corporate health has improved, with European blue-chip indices reaching highs due to a better-than-expected earnings season [1] Group 1: Earnings Forecasts - European companies are expected to report a 1.1% drop in fourth-quarter earnings for 2025, a significant improvement from the previously anticipated 3.1% decrease [1] - This projected decline would still represent the worst earnings performance in the past seven quarters [2] Group 2: Market Sentiment and Performance - Market forecasts for fourth-quarter earnings deteriorated significantly after the announcement of tariffs by U.S. President Donald Trump, with expectations for STOXX 600 company earnings dropping from around 11% growth to a contraction of up to 4.2% [3] - Recent weeks have seen a slight rebound in forecasts, with 60% of companies reporting better-than-expected results, compared to the typical 54% [4] Group 3: Revenue Outlook - The outlook for revenue has worsened, with STOXX 600 companies now expected to see revenues 3.4% lower than the same period last year, compared to a previous forecast of a 3.2% decrease [4] Group 4: Positive Contributors - Positive results from luxury group Hermes and EssilorLuxottica, along with optimistic guidance for 2026 from Anheuser-Busch Inbev and Siemens, have contributed to improved sentiment in Europe [5]

It's 5AM in New York City. Good morning. I'm Vonnie Quinn with your Bloomberg Brief.Let's get you set up for the day. Traders paring back rate cutbacks following that payrolls report. Jobless claims up next.Stocks recovering from another scare trade while anthropic inching closer to a deal that would value the farm at $350 billion. And midterm anxieties rise for President Trump as the House passes a bill targeting his levies on Canadian imports. So futures are pointed higher today.Now, yesterday, we had ano ...

ANNOUNCER: NEWSMAKERS AND MARKET MOVERS. THIS IS "THE PULSE" WITH FRANCINE LACQUA. FRANCINE: GOOD MORNING, EVERYONE, WELCOME TO "THE PULSE." I’M FRANCINE LACQUA IN LONDON.THE REPUBLICAN LED U.S. HOUSE HAS PASSED LEGISLATION AIMED AT ENDING PRESIDENT TRUMP’S TARIFFS ON CANADA. THE VOTE SIGNALS GROWING ANXIETY OVER THE ECONOMIC AGENDA BEFORE MIDTERM ELECTIONS FOCUSED HEAVILY ON AFFORDABILITY. TRUMP IS ALMOST CERTAIN TO VETO ANY BILL CALLING FOR A REPEAL OF TARIFFS.WE’RE BOUND BY BRENDAN MURRAY, THE MAN WHO NE ...

Core Insights - The luxury company experienced a 9.8% increase in fourth-quarter revenue, indicating a positive trend in the luxury market and suggesting a potential sustained rebound in the sector this year [1] Company Performance - The reported revenue growth of 9.8% in the fourth quarter reflects strong consumer demand and optimism within the luxury segment [1] Industry Outlook - There are hopes for a sustained luxury rebound in the current year, driven by increasing consumer confidence and spending in the luxury sector [1]

Core Viewpoint - Hermes reported steady revenue growth, driven by strong sales in the United States and Japan, despite a slight reduction in overall sales growth expectations [1] Group 1: Revenue Growth - The company continues to experience robust revenue growth, particularly in key markets such as the United States and Japan [1] - Sales of high-end handbags, priced at $10,000 and above, remain a significant contributor to the company's financial performance [1] Group 2: Market Performance - The strong performance in the U.S. and Japan indicates a resilient demand for luxury goods in these regions [1] - The company is adjusting its sales growth expectations slightly, reflecting a cautious outlook while maintaining overall positive growth [1]