😟 More tariffs make us unhappy

Good morning investors! BTC fell to around $90,000 as pressure mounts. Also, Happy Thanksgiving!

Today we cover:

• More tariffs coming?

• Home sales are slowing.

• Earnings are here

📊 Economy and News 

More Trump Tariffs?

President-elect Donald Trump plans to raise tariffs by an additional 10% on all Chinese goods coming into the U.S., according to a post on his social media platform Truth Social.

The post immediately followed one in which Trump said his first of “many” executive orders on Jan. 20 would impose tariffs of 25% on all products from Mexico and Canada.

Trump had threatened tariffs of 60% on Chinese goods while campaigning for president.

Mexico is the country's top trade partner as of September, representing 15.8% of total, followed by Canada at 13.9%.

"We suspect Trump's tariffs will take a toll on Mexican equities by denting optimism about near-shoring and limiting investment into the country," said Giulia Bellicoso, a markets economist.

Also, the announcements prompted a knee-jerk reaction in currency markets, with the U.S. dollar rising more than 2% against the Mexican peso and notching a four-year high against the Canadian dollar.

Global hits:

• The Adani Group is staring at trouble on several fronts as investors and partners rethink ties with the Indian conglomerate in the wake of bribery and fraud accusations by U.S. authorities.

• UK retailer confidence plunges, sales decline expected to worsen, according to CBI survey.

• IRS funding cut would increase US deficit, slow service.

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📈 Stocks

S&P 500 6,021.63 (+0.57%)
DJIA 44,860.31 (+0.28%)
NASDAQ 19,174.30 (+0.63%)
BRENT CRUDE 72.91 (-0.15%)
* Prices as of Nov 27th, 12:20 AM UTC

Abercrombie & Fitch Reports Strong Results and Raises Guidance

Abercrombie & Fitch continues to thrive, but not as well as expected. However, in the fiscal third quarter, the company outperformed Wall Street expectations:

• Earnings per share: $2.50 vs. $2.39 expected

• Revenue: $1.21 billion vs. $1.19 billion expected

Net income for the quarter ended November 2 rose to $131.98 million ($2.50 per share) from $96.2 million ($1.83 per share) a year earlier, with sales increasing 14% to $1.21 billion.

For the holiday quarter, Abercrombie forecasts 5%-7% sales growth, surpassing analyst estimates of 4.8%. Full-year sales growth is now projected at 14%-15%, up from prior guidance of 12%-13%, exceeding analysts’ 12.1% forecast.

Some more earnings:

• Nordstrom beat Wall Street’s revenue expectations and delivered a slightly rosier full-year sales outlook. The retailer’s sales growth is notable at a time when discretionary merchandise and the luxury sector have been under pressure. Clothing and shoe purchases lifted the company’s performance, with sales of women’s apparel and activewear jumping by double digits year over year.

• Workday’s results for the October quarter surpassed expectations, but it guidance for the current quarter did not. The human resources and finance software company announced forthcoming artificial intelligence agents.

• Dell Technologies reported quarterly earnings that beat analyst expectations for earnings per share but came up light on overall revenue. Dell shares have risen 86% so far in 2024 as investors realize that it is one of the most important companies selling tools and systems for AI developers.

Exciting: Amgen says obesity drug caused up to 20% weight loss after a year, with no plateau. Elsewhere, Disney has agreed to pay $43 million to settle lawsuit alleging it paid men more than women.

💵 Personal Finance

Incomes that are tax free - Part III

Let’s continue the series and have a look at a few more ‘incomes’ that are not taxed in the US:

Financial Gifts

If you talk to a tax expert, they will tell you this ‘tax secret’.

A financial gift is tax free given that you can prove it is a ‘gift’, i.e.: you did not pay anything in return.

This applies to both the receiver and the giver. For 2024, the lifetime gift tax exemption has increased to $13.61 million per individual. This is a rise from $12.92 million in 2023, reflecting adjustments for inflation. For married couples, the combined exemption is now $27.22 million. This elevated exemption is part of the Tax Cuts and Jobs Act (TCJA) provisions and is set to sunset on Dec 31, 2025, unless Congress makes changes, at which point it would drop significantly to approximately $5 million (adjusted for inflation).​

There, however, is a caveat.

You will have to pay income tax if the gift ends up earning you income. For example, if it was a painting that you sold to make a profit or a stock that earned you dividends. You will pay tax on this additional income.

Health Savings Accounts (HSAs)

Health savings accounts offer several benefits, including tax advantages as HSA distributions are not taxable. There’s just one condition: expenses must be medical related.

Inheritances

This is a complicated area because inheritances are generally not taxable. But, there are some exceptions.

You may have to pay taxes if the estates are over a certain size. These taxes, however, are paid by the estate itself.

For 2024, the federal estate tax exemption is $13.61 million for individuals and $27.22 million for married couples.

Check this interesting video on the topic:

💰 Be a Better Investor

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👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.

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