The trade war heats up

Good morning. Donald Trump escalates the trade war. The Federal Reserve's Jerome Powell is under attack again. And Superman soars to new heights. Listen to the day's top stories.

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Donald Trump dialed up trade tensions again by announcing a 30% tariff on imports from the EU and Mexico, effective Aug. 1. The EU plans to engage more with other countries hit by the US levies, people familiar said, and is looking to deepen trade agreements with India and other countries. Mexican officials were taken aback by Trump's threat, having frequently visited his top aides to discuss efforts to fight drug trafficking.

In markets, US equity-index futures retreated in a cautious start to the week. Although financial markets have shown increasing insensitivity to US tariff threats, they face a real test at today's open. Bitcoin soared past $120,000 for the first time, taking this month's gain to almost $14,000.

The president and his allies are opening a new front against Federal Reserve Chair Jerome Powell, criticizing his handling of the central bank's $2.5 billion HQ renovation. Bond investors were all but certain that the Fed would resume cutting interest rates by September, but that confidence has been wavering. The lack of cuts this year has frustrated Trump.

Trump's FTC Chairman Is Becoming MAGA's Answer to Lina Khan

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The US will send more Patriot air-defense batteries to Ukraine, a change of heart for the president who has held off on new weapons shipments since the start of his second term. French leader Emmanuel Macron raised his country's defense budget to counter the risk of war in the coming years. Meanwhile, Nvidia's Jensen Huang said China's military is unlikely to use US AI chips.

President Trump, Texas Governor Greg Abbott, and First Lady Melania Trump meet with local officials and first responder in Kerrville, Texas, on July 11. Photographer: Brendan Smialowski/AFP

Emergency crews in central Texas suspended their search for victims of recent flooding as another night of heavy rain touched off new flash flood warnings. Trump said it was "hard to believe the devastation" as he visited to see the damage. At least 120 people died and scores remain missing in the state's Hill Country region.

Deep Dive: Feel the Burn

Trump during a ceremony for the One Big Beautiful Bill Act on the South Lawn of the White House on July 4. Photographer: Alex Brandon/AP

Trump's $3.4 trillion fiscal package is already creating opportunities for segments of the energy and climate industries that had fallen out of favor. These are the sectors likely to get a boost:

Coal. The legislation phases out tax credits for wind and solar, which may diminish their economic edge over coal. It also adds metallurgical coal that's used to make steel to the list of critical minerals qualifying for tax credits.
Nuclear. Aging reactors were facing down extinction. Now, the AI boom has revived interest in carbon-free power plants capable of providing round-the-clock electricity, leading to efforts to revive two shuttered plants.
Geothermal. Harnessing the Earth's heat can provide electricity without interruption. But it's proven difficult and expensive to demonstrate sufficient resources for it to make inroads on the grid.
Geoengineering. Trump's law won't just alter the energy landscape. It has the potential to reshape the international climate order, including bringing the prospect of a risky gambit to cool the planet closer to reality.

Why Money Is Flowing Into Geoengineering

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The Big Take

Photographer: Qilai Shen/Bloomberg

China's biotech industry is upending the world's drug pipeline with an advance as ferocious as the nation's breakthrough efforts in AI and EVs.

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Opinion

Jerome Powell. Photographer: Al Drago/Bloomberg

Social media buzz suggests Fed chief Powell is on the brink of resignation—but markets and prediction platforms remain unconvinced, John Authers writes. Still, the mounting accusations point to a serious, coordinated push for his ouster.

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Krypto the Superdog also makes an appearance. Source: Warner Bros. Pictures

It's a bird, it's a plane, it's a box office smash. Superman, the first film from the new leadership team at Warner Bros.' DC movie studio, opened at No. 1 this weekend, pulling in $122 million in ticket sales in the US and Canada. It's no doubt a relief for director James Gunn who walked the fine line of addressing political issues while delivering blockbuster entertainment.