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Trade Wars
China’s Trade Surplus Reaches Record, Defying Expectations of Tariff-Driven Slowdown
China’s trade surplus, the difference between its exports and imports, reached a record in 2025 at $1.19 trillion. Exports jumped 5.5% last year from 2024 in dollar-denominated terms, compared with 5.9% growth the prior year, China’s customs agency reported Wednesday. Shipments to the U.S. fell, but Chinese manufacturers found new customers in the rest of the world. The global economy, powered by AI spending, kept chugging along, keeping external demand strong. And another year of producer-price deflation made Chinese goods attractive to overseas buyers.
Exports to the U.S. dropped 20% in 2025. Meanwhile, exports to a bloc of Southeast Asian countries jumped 13%, those to the European Union rose 8.4%, those to Latin America increased 7.4% and those to Africa surged 26%. Overall exports for the month of December grew 6.6% year over year, up from 5.9% in November, while imports rose 5.7%. China’s global trade imbalance has increasingly become a geopolitical liability. Some places, such as the European Union, worry that a flood of cheap Chinese goods could hurt local industries. The International Monetary Fund has warned that China, the world’s second-largest economy, is too big to rely on exports for growth.
Read more at The WSJ
Pentagon to Invest $1 Billion in L3Harris Rocket Motor Business
The U.S. government will invest $1 billion in L3Harris Technologies' growing rocket motor business, guaranteeing a steady supply of the much-needed motors used in a wide range of missiles such as Tomahawks and Patriot interceptors. L3Harris said on Tuesday it is planning an IPO of its growing rocket motor business into a new publicly traded company backed by a $1 billion government convertible security investment. The securities will automatically convert to common equity when the company goes public later in 2026.
The deal represents the latest U.S. government investment in Corporate America, which has included a 10% stake in chipmaker Intel and investments in critical mineral producers. It comes just a few days after President Donald Trump blasted defense contractors for slow production of weaponry. The investment marks the first direct-to-supplier partnership of this kind and is an outcome of the department's new Acquisition Transformation Strategy and its "Go Direct-to-Supplier" initiative. The strategy calls for the department to negotiate and invest directly with critical suppliers to save money. L3Harris' Missile Solutions unit, which produces missile propulsion systems for many missiles including Patriot, THAAD, Tomahawk, and the Standard Missile, will be carved out from the company. L3Harris will retain majority ownership and control of the new entity. The deal all but guarantees a steady flow of business for the new unit.
Read more at US News and World Report
JPMorgan Chase Tops Estimates As Trading Revenue Exceeds Expectations
JPMorgan Chase posted fourth-quarter results that topped expectations on better-than-expected revenue from the bank’s trading operations. Adjusted earnings were $5.23 per share and revenue was $46.77 billion. The company said profit fell 7% to $13.03 billion, or $4.63 per share, because of a pre-announced $2.2 billion reserve tied to its takeover of the Apple Card loan portfolio from Goldman Sachs. Excluding the 60-cent-per-share hit from that transaction, adjusted earnings came in at $5.23 and topped analysts’ expectations.
Companywide revenue rose 7% to $46.77 billion as net interest income also rose by 7% to $25.1 billion, roughly matching analyst expectations for NII. Equities trading revenue surged 40% to $2.9 billion, about $350 million more than analysts had expected, as the company cited strength across operations, especially in its business catering to hedge funds. Fixed income trading revenue rose 7% to $5.4 billion, about $110 million more than expected. Investment banking, however, appeared to disappoint, as fees fell 5% to $2.3 billion.
Separately, bank CEO Jamie Dimon warned that political interference with fed would push up rates. Dimon, speaking with reporters after JPMorgan Chase issued its fourth-quarter earnings results, said political interference with the Fed would cause inflation and interest rates to go up, contrary to President Trump’s stated goal of getting rates to go lower.
Read more at CNBC
Nvidia, Eli Lilly Announce $1 Billion Investment In AI Drug Discovery Lab
AI chipmaker Nvidia and pharmaceutical giant Eli Lilly on Monday announced that the two companies would jointly invest $1 billion to create a lab in San Francisco focused on using AI to accelerate drug discovery. “Combining our volumes of data and scientific knowledge with NVIDIA’s computational power and model-building expertise could reinvent drug discovery as we know it," said Lilly CEO David Ricks.
The $1 billion investment will be spent over five years on infrastructure, compute, and talent for the lab. Nvidia's engineers will work alongside Lilly's experts in biology, science, and medicine to generate large-scale data and build AI models to advance medicine development. The lab's work will begin early this year, the companies said. The investment builds on Nvidia and Lilly's existing partnership. Lilly in October said it was building an AI factory with Nvidia's AI systems to speed up drug discovery timelines.
Read more at YahooFinance
GE Draws $1.42B Navy Engine Contract
GE Aerospace is in line to produce a total of 277 turboshaft engines through September 2032 following a $1.42-billion U.S. Navy award, a modification to an earlier contract for T408-GE-400 engines to power U.S. Marine Corps CH-53K helicopters. The award finalizes Lots 9 and 10 production for the CH-53K King Stallion, and adds more detail to the plan for Lots 11, 12, and 13. GE Aerospace is set to manufacture new-production and spare engines at its Lynn, Mass., plant, and as well as provide sustainment services for the engines. Other GE Aerospace plants in Hooksett, N.H.; Rutland, Vt.; Madisonville, Ky.; Dayton, Ohio; and Jacksonville, Fla. supply components for the program.
The Sikorsky CH-53K King Stallion is the USMC’s heavy-lift helicopter, for transporting heavy equipment, personnel, and supplies. The aircraft are capable of lifting more than 27,000 lbs. externally over a 110 nautical mile radius, powered by three T408-GE-400 engines. Those are the turbofan engines GE Aerospace developed especially for the helicopters, which were introduced in 2022.
Read more at American Machinist
Ford Unveils In-House-Built Processor Module For Future Vehicles
Ford Motor Co. has unveiled a new in-house-built computer that will serve as the “brain” of its future software-defined vehicles, the company announced in a Jan. 7 blog post. The high-performance module bundles the management of vehicle infotainment, advanced driver assistance systems, audio and network processing into a single, compact housing that costs 10% to 15% less per unit to produce.
The company says the goal of developing a custom-built processor is to “democratize” advanced vehicle technology that’s typically offered in luxury and high-end models and make it accessible to more Ford customers. Many OEMs source hardware and semiconductors from electronics suppliers such as Nvidia, NXP Semiconductors, Bosch, Continental and others due to their complexity and specialized manufacturing requirements. But Ford is taking a strategic vertical integration approach to ensure that it controls the entire vehicle’s hardware and software stack in the future, which will eventually expand to the automaker’s entire portfolio, per the release.
Read more at Ward’s Auto
Stellantis Cancels Entire Plug-In Hybrid Lineup That Made It Segment Leader
Stellantis is scrapping its plug-in hybrid electric Jeep SUVs and Chrysler minivan amid slowing EV sales, quality issues and weakened federal fuel economy requirements. The automaker on Friday said the decision to end production of the plug-in hybrid Jeep Wrangler, Jeep Grand Cherokee and Chrysler Pacifica was a result of waning customer demand and the need to focus on “more competitive electrified solutions, including hybrid and range‑extended vehicles.”
“Stellantis continually evaluates its product strategy to meet evolving customer needs and regulatory requirements. With customer demand shifting, Stellantis will phase out plug‑in hybrid (PHEV) programs in North America beginning with the 2026 model year,” the company said in an emailed statement. The decision is an about-face for the automaker, which has touted its U.S. sales leadership of the models for years. In 2024, then-Jeep CEO Antonio Filosa — who is now CEO of Stellantis — said the SUV brand planned to sell 160,000 to 170,000 PHEVs that year, and the company said it represented 41% of U.S. PHEV sales. PHEVs feature traditional internal combustion engines, but also have an all-electric range when charged like an EV.
Read more at CNBC
America’s Biggest Power Grid Operator Has an AI Problem—Too Many Data Centers
America’s AI boom is pushing the nation’s largest power-grid operator to the brink of a supply crisis. Sixty-seven million people in a 13-state region stretching from New Jersey to Kentucky get their power from a market operated by nonprofit PJM. So, too, do the many AI data centers springing up in Northern Virginia’s “Data Center Alley,” which have a bottomless appetite for electricity. Rates are going up for consumers. Older power plants are going out of service faster than new ones can be built. And the grid’s capacity is in danger of maxing out during periods of high demand, which could force PJM to call for rolling blackouts during heat waves or deep freezes to avoid damaging grid infrastructure.
Grid operators such as PJM play a vital role in the U.S. energy system. In the vast region served by PJM, it serves as the intermediary between power producers and the utilities that own the poles and wires and deliver electricity to consumers. PJM’s mission is to balance supply and demand by telling power plants when to ramp production up or down. Other regions of the country are also seeing a surge in power demand tied to data centers. West Texas and the parts of the Southeast and the Southwest are becoming home to massive facilities. Power demand forecasts vary widely, but analysts expect significant growth in the coming years. An analysis by consulting firm ICF forecasts U.S. power demand in 2030 will be 25% higher than it was in 2023, largely because of data center needs.
Read more at The WSJ
J&J Adds 2 US Manufacturing Plants To Investment Plans
Johnson & Johnson said it will establish two U.S. manufacturing facilities as part of a larger $55 billion commitment to support domestic production over the next four years. The pharmaceuticals giant plans to build a cell therapy manufacturing site in Pennsylvania and a drug production plant in Wilson, North Carolina, further expanding its presence in each state, according to multiple news releases. A J&J spokesperson declined to disclose specific financial and location details. J&J said it has begun investing billions of dollars in domestic manufacturing over the past 10 months, with a goal of producing “the vast majority” of its advanced medicines stateside.
Last year, J&J broke ground on a 500,000-square-foot biologics manufacturing facility in Wilson, North Carolina, with construction underway. The drugmaker also signed a $2 billion deal in September to secure manufacturing space at Fujifilm Biotechnologies’ Holly Springs, North Carolina, facility, over a 10-year period. J&J also plans to build a second “multibillion-dollar” facility in Wilson, marking its third investment in North Carolina over the past year. J&J also plans to build a “next generation” cell therapy site in Pennsylvania as other life sciences firms, such as Eurofins and GSK, expand in the state.
Read more at Manufacturing Dive
Boeing’s Airplane Deliveries Are The Highest In 7 Years. Now It’s About To Pick Up The Pace
Boeing is set to report this week that it delivered the most airplanes since 2018 last year after it stabilized its production, the clearest sign of a turnaround yet after years of safety crises and snowballing quality defects. Now, the aerospace giant is planning to ramp up production. “It’s a long road back from a ... shall we say, a rather dysfunctional culture, but they’re making big progress,” said Richard Aboulafia, managing director at AeroDynamic Advisory, an aerospace industry consulting firm.
Boeing’s leaders, including CEO Kelly Ortberg, are gearing up to increase production this year of its cash cow 737 Max aircraft and the longer-range 787 Dreamliners. That could help the manufacturer, the top U.S. exporter by value, return to profitability, as analysts expect this year, territory that was out of reach for seven years as its leaders focused on damage control and were stuck reassuring frustrated airline executives who were awaiting late planes. The recent turnaround has taken place largely on the assembly floor. Under Ortberg, the manufacturer has slashed so-called traveled work, in which assembly tasks are done out of order, to avoid costly mistakes. The company has made other manufacturing changes, as well, including added training.
Read more at CNBC
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