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J. Edward Moreno3/4/25

Taco Bell arises as the day’s tariff hedge

Mexican food that no one in their right mind thinks comes from Mexico is one of the most tariff-immune investments of the day.

Yum! Brands, the owner of Taco Bell, reached a record high on Tuesday amid a widespread market meltdown over 25% tariffs imposed on Mexico and Canada. It’s almost as if Taco Bell, the maker of the Crunchwrap and Doritos Locos Tacos, has almost no economic ties to the country that inspires its eccentric cuisine.

The move came after the company reported that it expects same-store sales for Taco Bell — which has recently outperformed its fast-food peers — to increase by 8% in 2025. The stock went up by more than 2%, reaching a record high of about $161. (The word “tariff” has not come up in Yum! Brands’ earnings calls since December 2010, according to FactSet.)

Other inauthentic Mexican food chains were not so lucky. Chipotle, which uses more avocados than Taco Bell does, fell by more than 2%. Chipotle CEO Scott Boatwright said on Sunday that the burrito chain would eat the increased costs of tariffs rather than pass it to consumers.

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Tariff losers are today’s big winners as Supreme Court seen as likely to strike down Trump’s IEEPA tariffs

US companies in the crossfire of wide-ranging tariffs imposed by the Trump administration are surging as the Supreme Court hears oral arguments on the legality of levies imposed under the International Emergency Economic Powers Act and prediction markets conclude that the ruling is not likely to go the government’s way.

Event contracts offered by Polymarket ascribe roughly 30% odds of the Supreme Court ruling in favor of the existing tariff regime, a number that got as low as 18% around 11:30 a.m. ET. Earlier this morning, that likelihood was briefly above 50%.

A basket of stocks deemed to be the biggest losers from Trump’s tariffs compiled by UBS is having one of its best days of 2025, up 3.7% as of 1:48 p.m. ET.

Rivian’s standout post-earnings rally is giving that index a big boost, but other gainers include Gap,American Eagle, Yeti, Fluence Energy, Nike, Stanley Black & Decker, RH, Deckers Outdoor, Under Armour, Wayfair, Best Buy, Williams-Sonoma, Crocs,Five Below, and Dollar Tree.

WisdomTree macro strategist Sam Rines recently warned that the Supreme Court striking down IEEPA tariffs could turn into a “be careful what you wish for” or “pyrrhic victory”-type scenario, as the Trump administration would likely a) talk more about tariffs, an issue that the stock market is keen to move on from and b) pursue alternative mechanisms to get similar levies back on.

Max Knoblauch2h

US airlines climb as President Trump shifts his tone about the urgency of ending the shutdown

Shares of US airlines are climbing as the government shutdown stretches into a record 36th day.

Stocks of several carriers, including Delta Air Lines, United Airlines, and American Airlines, rose significantly following an apparent change of tune from President Trump, who on Wednesday told Senate Republicans that they “must get the government back open soon, and really immediately.”

It’s a shift from the president, who’s traveled frequently during the shutdown and stuck firmly to the idea that the administration wouldn’t negotiate with Democrats before the government reopened.

Airlines had tumbled on Tuesday, following comments from Transportation Secretary Duffy that the US could close parts of its airspace amid an air traffic controller shortage that’s been escalated by the shutdown.

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Matt Phillips2h

Top Trump trade hit by Trump tariffs

In the early days of Trump 2.0, Axon, the maker of Taser, body cameras, and other gear for police and security forces, was a top Trump trade.

That is, it was one of the group of companies whose share prices soared on expectations of big changes — in this case a surge of spending on police and immigration enforcement — under the new administration.

And sales of the company’s security products, under its Connected Products division, did rise. But in the just-reported third quarter, costs rose more. And one of those rising costs was the Trump administration’s tariffs.

In its post-earnings conference call, Axon officials blamed tariffs for a large part of the earnings miss that sent the stock plummeting by roughly 20% in the after-hours session Tuesday.

“The impact from tariffs is obviously hitting the Connected Devices business overall. This was the first quarter that we had a full quarter of impact from tariffs,” Axon CFO and COO Brittany Bagley told analysts on the call. “So as we look at the year-over-year step down, that really is attributable to tariffs.”

She continued, “As long as tariffs stay in place, I view that as sort of a onetime adjustment. So now that’s baked into the gross margins.”

Clearly the market didn’t like the sound of that. But perhaps those tariffs may not stay in place.

Late in the morning, Axon sharply cuts its losses on the day — it had been down as much as 20% — as oral arguments in the Supreme Court case to determine the legality of President Trump’s tariff regime got underway. On balance, its seems the administration’s arguments were getting a chilly reception from the justices.

Axon shares extend fall as tariffs hurt the Taser maker's quarterly profit

Axon shares extend fall as tariffs hurt the Taser maker's quarterly profit

And sales of the company’s security products, under its Connected Products division, did rise. But in the just-reported third quarter, costs rose more. And one of those rising costs was the Trump administration’s tariffs.

In its post-earnings conference call, Axon officials blamed tariffs for a large part of the earnings miss that sent the stock plummeting by roughly 20% in the after-hours session Tuesday.

“The impact from tariffs is obviously hitting the Connected Devices business overall. This was the first quarter that we had a full quarter of impact from tariffs,” Axon CFO and COO Brittany Bagley told analysts on the call. “So as we look at the year-over-year step down, that really is attributable to tariffs.”

She continued, “As long as tariffs stay in place, I view that as sort of a onetime adjustment. So now that’s baked into the gross margins.”

Clearly the market didn’t like the sound of that. But perhaps those tariffs may not stay in place.

Late in the morning, Axon sharply cuts its losses on the day — it had been down as much as 20% — as oral arguments in the Supreme Court case to determine the legality of President Trump’s tariff regime got underway. On balance, its seems the administration’s arguments were getting a chilly reception from the justices.

Rivian shares poised for best day since January as the EV maker hypes its next SUV during earnings call

Rivian shares surged more than 15% the morning following its Q3 earnings results.

Rivian Reveals All-Electric R2 Midsize SUV

Nebius Group gains after launching Token Factory platform to offer access to inference compute using open-source models

An attempt to add more breadth to the AI boom.

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