Apple cheers Trump with $500bn US investment plan; UK defence firm Chemring ‘targeted’ by private equity firm – business live

Apple emphasises that today’s $500bn investment plan is its “largest-ever spend commitment”.

It also flags that it is one of the largest US taxpayers, having paid more than $75bn in US taxes over the past five years, including $19bn in 2024.

[In Europe, though, Apple was ordered to pay €13bn, plus interest, in unpaid Irish taxes from 2004–14]

Wall Street doesn’t seem to quite share Donald Trump’s enthusiasm about Apple’s investment splurge.

Shares in Apple are down 0.5% in pre-market trading, with just over an hour until Wall Street opens.

Apple plans Texas factory for AI servers

Apple says its new manufacturing academy in Detroit will help US companies transition to advanced manufacturing.

It says:

Apple engineers, along with experts from top universities such as Michigan State, will consult with small- and medium-sized businesses on implementing AI and smart manufacturing techniques.

The academy will also offer free in-person and online courses, with a skills development curriculum that teaches workers vital skills like project management and manufacturing process optimization. The courses will help drive productivity, efficiency, and quality in companies’ supply chains.

Trump: Thank you Tim Cook and Apple

Apple announces plans to create 20,000 US jobs in $500bn investment splurge

Here’s a chart showing how the euro lost ground against the US dollar towards the end of last year, before a small pick-up this morning after the German election:

Sky News: Bain Capital targets £1bn listed defence group Chemring

In the energy sector, BP are reportedly poised to ditch a key green target later this week.

Reuters are reporting that BP’s chief executive, Murray Auchincloss, will scrap a target to increase renewable generation 20-fold by 2030 when he updates investors on the companies plans.

Reuters says:

On Wednesday, when BP holds a capital markets day, CEO Murray Auchincloss will tell investors the company is abandoning its target to grow renewable generation capacity 20-fold between 2019 and 2030 to 50 gigawatts, two sources close to the matter said.

The plan to drop the target has not been previously reported.

One big question is whether Germany’s next government can relax its fiscal rules sufficiently to lift defence spending.

Tom Bailey, head of research at HANetf, says:

“The centre-right Christian Democrat party emerged as the winners of Germany’s election. The expected next chancellor of Germany, Friedrich Merz, wasted no time in addressing Europe’s most pressing issue: defence. Merz was frank in his comments, arguing that the Trump government does “not care much about the fate of Europe” and speculated whether NATO will continue to exist in its current form.

“Such stark comments come following the Trump government raising serious doubts about the US’ continued commitment European security. Merz’s comments suggests the new Germany government is now serious about boosting defence spending to fill the gap potentially left by the US pivoting away from European defence.

“The next question will be whether the new coalition government in Germany can sufficiently loosen its fiscal rules to boost defence spending. Germany currently spends a little over 2% of GDP on defence. While this meets the 2% target set by NATO in 2014, it is increasingly seen as inadequate in the current geopolitical climate. Mark Rutte, the current head of NATO, has noted spending will have to go higher than 3%, while the Trump administration is demanding 5%.

But with the risk of US disengagement from Europe now so acute, this question moves beyond reaching pre-agreed spending targets and instead becomes: how Europe can develop the capability to defend itself without an American defence backstop?

Neil Shearing, group chief economist at Capital Economics, agrees that European governments are likely to face “significant pressure” to lift defence spending.

The head-spinning events of the past two weeks – including the suggestion last night by German Chancellor-elect Friedrich Mertz that Europe should seek “strategic independence” from the US – have led many to declare the end of the post-war trans-Atlantic alliance and the start of a new period of geopolitical realignment.

However, thinking through what “strategic independence” might mean in practice reveals the extent of the ties between the US and Europe. While the risks of a trans-Atlantic fissure have clearly increased, these ties will be difficult to sever altogether. The most likely outcome is that in four years’ time the US and Europe will remain geopolitically aligned.

The greatest consequence of the past week’s events from a macro perspective may be that European governments are going to face substantial pressure to significantly increase their defence spending.

Germany’s MDAX index on track for best day in 14 months

Euro dips back from one-month high

Deutsche Bank chief urges ‘fundamental reforms’

This morning’s Ifo index doesn’t provide any boost for Germany’s incoming government, reports analysts at ING.

Carsten Brzeski, ING’s global head of macro, told clients:

Germany’s most prominent leading indicator, the Ifo index, just signalled that the next government cannot count on any cyclical tailwind, yet. Coming in at 85.2 in February, from 85.1 in January, the Ifo index suggests that the German economy is still in stagnation. The current assessment component weakened significantly (from 86.0 in January to 85.0 in February), while expectations improved somewhat.

Germany’s economic problems should be well-known by now. In the short run, possible US tariffs as well as increased energy prices should continue weighing on economic activity. At the same time, renewed geopolitical tensions and the US administration’s changed stance on defence and security in Europe are likely to weigh on consumer spending. This is why all eyes will now be on the upcoming coalition talks, hoping for some breakthrough and at least a confidence boost.

German business morale stagnates

Back in London, share in discount retailer B&M have tumbled 8% after it cut its profit forecasts and announced the departure of its chief executive.

B&M blamed “an uncertain economic outlook” and a possible hit from exchange rate volatility on its stock valuations.

It now expects adjusted core earnings this year of between £605m and £625m, down from £620m-£650m before.

B&M also revealed change at the top – CEO Alex Russo will retire form the company on 30 April 2025.

Yesterday’s German election highlights that populism remains ascendant, says Bill Blain, market strategist at Wind Shift Capital Advisors.

Blain writes:

The electoral numbers show new, young voters are increasingly attracted to the populist parties, voting for the Left, the AfD or Greens. They have given up on the traditional parties. They vote according to how they hear and translate the political noise, and where they pick up their political affiliations and news. That’s the new battlefield for votes; social media and podcasts – it’s ground traditional parties just don’t know how to play.

He also cautions that less may change in Berlin now than investors hope:

The German elections highlight the dangers of coalition politics – swimming in a sea of treacle to agree policy choices as the likelihood of bad compromises rises.

Even as Trump and Ukraine roil and destabilises the European Union, Germany is set for the distinct possibility nothing much changes. It is not strong and stable leadership at a time when it is desperately needed.