Oil prices rebounded on Monday, despite ongoing global uncertainty triggered by U.S. President Donald Trump's announcement of new tariffs on steel and aluminum. These proposed tariffs could significantly affect the global economy and demand for energy resources.

According to recent data, Brent crude oil futures rose by 40 cents, or 0.5%, reaching $75.06 per barrel. Similarly, West Texas Intermediate (WTI) crude increased by 38 cents, or 0.5%, to $71.38 per barrel. It is noteworthy that last week marked the third consecutive week of declining prices, driven by fears of a potential global trade war.

U.S. Policy and the Global Market

On Monday, shares of the Australian steel manufacturer, BlueScope Steel $BSL.AX, reached their highest level in over two months. This market behavior is linked to expectations that the company's American operations will benefit from potential new tariffs on steel imports to the US.

As of 02:34 GMT, BlueScope Steel shares were up by 4%, hitting their highest level since December 2, 2024. During this period, many other stocks within the S&P/ASX 200 index (AXJO) showed a decline of 0.4%.

US Trade Policy

For the week ending February 4, asset managers significantly increased their net long position on Chicago Board of Trade (CBOT) corn futures and options to 364,217 contracts, up from 350,721 contracts the previous week. This increase in positions marks the most optimistic outlook for corn since April 2022.

The seven-week continuous bullish trend in corn has garnered significant attention, as it is the second time in the past four years that funds have been net buyers of corn for such an extended period. The last occurrence was in September 2022, although the number of contracts was noticeably smaller then.

Historical Comparison and Current Records

The U.S. job market witnessed a slower growth in January than anticipated, following substantial gains in the preceding two months. While this slowdown is noteworthy, the unemployment rate remains steady at 4.0%, a factor that could influence the Federal Reserve's decisions on interest rates.

The Department of Labor's recent employment report reveals a stark rise in wages. This increase in average hourly earnings marks the highest growth in the past five months, potentially bolstering consumer spending. Despite the slowdown in job growth, this wage rise injects optimism into the economic landscape.

Impact on Monetary Policy

In January, Brazil's trade surplus experienced a significant drop of 65.1% compared to the same month last year. This decline was attributed to a robust increase in imports alongside a drop in exports, highlighting key dynamics in the country's trade landscape.

According to the Ministry of Development, Industry, Trade, and Services, Brazil's surplus amounted to $2.2 billion this January, a stark contrast to the $6.2 billion surplus recorded the previous year. Economists surveyed by Reuters had predicted a surplus of $3 billion, reflecting a surprising deviation from expectations.

Export Trends

Venture Global $VG, a prominent American LNG producer, has taken a pivotal step by proposing the construction of the CP2 export facility in Louisiana. This development holds significant implications for the global LNG market and the strategic positioning of the United States in energy exports.

In 2023, the United States emerged as the world’s largest LNG supplier, surpassing previous leaders Australia and Qatar. This shift was fueled by several factors:

1. Increased Global Prices: The rise in LNG prices has spurred greater demand for exports.

2. New Projects: Initiatives by Venture Global and other companies contributed to the growth of LNG export capacity.

Affirm $AFRM recently experienced a significant boost in its stock value, with shares soaring by 19.5% on Friday. This surge is attributed to the robust holiday shopping season, which led to the company's unexpected quarterly profit and an optimistic forecast for annual revenue growth.

- Consumer Trends: A growing number of consumers are embracing Buy Now, Pay Later $BNPLUSD services to capitalize on substantial discounts offered by retailers on items ranging from clothing to electronics.

- Economic Context: With inflation and interest rates remaining high, consumers are drawn to the flexibility provided by BNPL solutions like Affirm. This trend reflects a shift from traditional credit as individuals seek manageable ways to handle expenditures.

Hertz Global Holdings $HTZ achieved a significant legal victory on Friday when a lawsuit from warrant holders was dismissed. This decision potentially saves the car rental giant from paying hundreds of millions of dollars following a series of financial maneuvers.

Funds associated with Discovery Capital Management filed a complaint in June of the previous year. The complaint asserted that Hertz underwent a multi-billion-dollar "recapitalization" from November 2021 to December 2023. This process, which included a change in leadership, was claimed to warrant a $187.5 million payment to the funds, given their holding of 11% of Hertz's warrants. Had other warrant holders sought similar compensation, claims could have escalated to approximately $1.7 billion.

Court's Decision

The International Monetary Fund (IMF) recently released a report shedding light on the vibrant economic trajectory of Nicaragua. Anticipated to grow around 4% in both the current and upcoming year, this projection is underpinned by sound macroeconomic policies and robust remittance inflows.

Central America's economic engine gained momentum in 2023, marking a 4.6% growth. This impressive uptick highlights the impact of strategic economic measures and external financial flows that bolster the nation's financial health.

Key Drivers of Economic Growth

In the evolving landscape of global finance, central banks worldwide might find room to lower interest rates further, creating a mild "decoupling" from the United States Federal Reserve as it pauses its policy easing cycle. This shift signifies a pivotal moment in economic strategy across the globe.

- Federal Reserve's Pause: The Federal Reserve, traditionally the vanguard of global monetary policy, finds itself in unfamiliar territory as it halts interest rate cuts amidst a thriving US economy.

- Decoupling Trends: Other global economies, grappling with economic turbulence, may pursue independent rate cuts to spur growth, diverging from the Fed's path.

The European automotive landscape is currently facing significant challenges, particularly for companies like Volkswagen's $VOW.DE SEAT. Recently, SEAT's CEO, Wayne Griffiths, highlighted the severe impacts of the European Union's tariffs on Chinese-manufactured electric vehicles (EVs). Without a reduction in these tariffs by the end of March, SEAT may need to cut production and lay off approximately 1,500 employees.

- Increased Tariffs: Since October, the EU has imposed additional tariffs on all Chinese-manufactured electric vehicles.

- Financial Strain on SEAT: Specifically, SEAT's CUPRA Tavascan, produced at VW Group's Anhui plant in China, now faces a 20.7% additional tariff, on top of the existing 10% tariff.

Nikola Corporation $NKLA, an electric vehicle manufacturer based in Phoenix, Arizona, is reportedly on the brink of filing for bankruptcy, as highlighted by a recent article in the Wall Street Journal. The company's stock experienced a dramatic drop of 20%, hitting just 60 cents in after-hours trading.

Recent developments suggest Nikola is grappling with severe financial challenges:

- Depleting Cash Reserves: The company is having difficulty securing additional funding while its cash reserves continue to dwindle.

- Losses Per Unit: Nikola is reportedly losing significant sums on each vehicle it sells, further exacerbating its financial woes.