The Rundown - China Restricts Exports on Key Resources, Netflix Sets Goal for $1T Valuation

Episode Date: April 15, 2025

Stock market update for April 15, 2025.

Public.com presents the rundown. Your daily market update in five minutes. My name is Zad Mani, and today is Tuesday, April 15th. In today's episode, we tell you about President Trump's latest comments about tariff exemptions that has automakers pretty excited. We also tell you about the latest moves that China is taking as the trade war with the U.S. gets more intense. We also discuss NVIDIA's plans to build more AI supercomputers in the U.S.

Then stick around to the end of the show to find out how much Coachella is making from their buy now pay later fees. We got a great show for you today. Let's go. Another volatile day in the stock market to start off the week. Stock started off the day hot on Monday morning, then dipped into the red by mid-afternoon before rallying late afternoon to squeeze out a win. Wouldn't want it any other way. The S&P 500 end of the day up 0.8%. And the NASDAQ added 0.6%.

So not a bad start to the week. President Trump made some more tariff news yesterday, hinting at a tariff exemption for automakers. I'm looking at something to help some of the car companies where they're switching to parts that were made in Canada, Mexico, and other places. And they need a little bit of time because they're going to make them here. But they need a little bit of time. So I'm talking about things like that. Now, the president didn't give a lot of details, but that comment was a spark for automakers, stocks of four. GM and Stalantis were up more than 3% yesterday as a result.

And we got more development around tariffs. Yesterday, five small businesses sued President Trump to block all the tariffs that he's imposed over the last few weeks. The lawsuit claims that the president does not have the power to levy tariffs. That power only belongs to Congress. Now, Trump has imposed these tariffs under the Emergencies Economic Powers Act that Congress passed back in 1977, that gives the president the power to levy.

tariffs in times of economic emergency. And according to the president, we are in an economic emergency right now. He points to the trade deficit, the fentanyl crisis, and that's the justification for the tariffs. But the lawsuit thinks this is a misuse of the Emergency Powers Act because a trade deficit doesn't constitute an emergency. So now this is headed to court and we'll see what the judges have to say about that. I'm not sure how long this will take to settle out in court, but it just continues to add to the uncertainty around the tariffs. Never a dull moment these days, though, right? Speaking of no dull moments, let's talk about the escalating trade war with China.

China has now announced that they're holding back exports of rare earth metals and critical magnets needed for the production of goods that range from electric vehicles to defense missiles. This was China's response to President Trump's escalation of tariffs, which currently sit at 145% on Chinese imports. Now, contrary to the name, rare earth metals aren't actually that rare, but they are incredibly complex to refine. And nearly all that refinement happens in China. China produces 270,000 metric tons of rare earth minerals compared to just 113,000 for Australia

and 45,000 for the U.S. And the U.S. relies heavily on China for these rare earth imports. Shares of rare earth imports from China from 2020 to 2023 was 70% percent. After that was Malaysia at 13% and Japan at only 6%. China also produces 90% of the world's rare earth magnets. Now, there is a company in the U.S. that does do rare earth metals. They're called MP Materials. And their stock was up 20% yesterday because it owns the sole rare earth mine in the U.S.

They started the process of bringing the rare earth supply chain to the U.S. Now, I do want to give some more context here. While the U.S. does import a majority of its rare earth metals from China, the actual amount isn't that much. It's just $170 million. I mean, that's just a fraction of the $438 billion of goods that the U.S. imported from China in 2024. So these rare earth metals don't seem to be economically significant on the surface, but the concern is that without these critical imports, some crucial supply chains might end up shutting down. So that's definitely an area to watch. But it doesn't seem to be that China is backing down at all from the trade war because this morning it was reported that China is also now halting all of its Boeing orders.

So things are escalating pretty quickly right now. Now shifting gears a bit, one company that is planning to manufacture more in the U.S. is Nvidia. Envidia announced plans to build half a trillion dollars worth of AI gear in the U.S., which includes mass-producing AI supercomputers here in my hometown of Houston, Texas. They're partnering with Foxconn to do the manufacturing. Within the next 12 to 15 months, these factories are going to start pumping out the supercomputers. They're also building the supercomputers at a manufacturing facility in Dallas. But I mean, let's be real. The Houston one is going to be way better than the one in Dallas because the Dallas factory might end up training their best worker at some point.

If you know, you know. Now, what caught my attention was that Nvidia plans to use their advanced AI and robotics and digital twin technologies to design and operate these manufacturing facilities. So we've hit the point now where AI is designed. and making more AI. Pretty sure I've seen a few movies about that. Nothing to worry about. But just beyond the tech innovation happening year,

this is a pretty big announcement because it's the first time that AI supercomputers are being made here in the U.S. Nvidia also points to the TSM plant in Phoenix, Arizona, which is already starting to produce their Blackwell AI chips. So it looks like Nvidia is investing more here in the U.S. Now, that might be because of tariffs.

They're not outright saying it. Or it could all be part of a bigger plan, where InVindia invests heavily in U.S. manufacturing now as a way of getting tariff exemptions in the short term. This is just me speculating here. The company hasn't said anything about this. Trump did grant tariff exemptions on chips and semiconductors on Friday night, but then over the weekend, he threatened to tariff semiconductors again.

We talked more about that on yesterday's show, so go check that out if you missed it. But overall, I'm glad that Nvidia is building more here in the U.S., especially here in Houston. I mean, Houston has been making big moves recently. Apple recently announced plans to build AI servers here in Houston. and now Nvidia is doing it. We might have to rebrand the city at some point. Everyone calls Houston Space City, but I think it might be time to call it like server city or something.

I'm still a workshop in the name, but let me know in the comments if you have something better. Let's talk about some stocks making moves today. Shares of Netflix are up after the Wall Street Journal reported that executives expect the streaming giant to reach a $1 trillion market cap and double the revenue by 2030. This is according to the company's annual business review meeting.

Doubling revenue would bring Netflix's total sales to around $80 billion a year. Netflix also has a goal to bring ad revenue to $9 billion by 2030 and to boost its subscriber count to about $410 million. They currently have around $300 million right now. So Netflix executives are very bullish on the company, and investors seem to be as well. Chairs are up around 3% today in reaction to this report. Netflix stock has gone up almost 60% over the last 12 months, and their market cap currently sits

at $400 billion. Do Netflix executives think the stock will more than double in the next five years? Now, on the flip side, Albertson shares are dropping this morning after the grocery chain reported earnings and warned of lower than expected profits moving forward. The company did put up decent numbers in Q1, both revenues and earnings beat estimates, but they're facing some challenges moving forward. For one, the company's merger with Kroger was called off due to regular. is blocking it. So that's going to make it harder for Albertsons to compete with behemots like

Walmart. But the company says they are building out their loyalty program and online sales infrastructure to help boost growth. Investors aren't as optimistic, though, and shares of Albertsons are down nearly 7% this morning in reaction to these earnings. Let's wrap the show with a fun fact. About 60% of Coachella's attendance finance their tickets to attend the festival. This is according to Billboard. I mean, look, Coachella tickets aren't cheap, all right? A three-day weekend pass starts at $500. Then you add in all the fees and the different tiers.

So the tickets can get pretty expensive. So having a buy-now pay-later option does make sense, especially since the people attending the festival are younger. This is just another example of buy-now pay-later becoming more and more popular. But I don't know, something about financing your tickets to go to a music festival just feels weird. It's like the same vibe as doing a buy-now pay-law. later for your DoorDash order.

Now, what's interesting about this one is the festival does charge a $41 fee to utilize the payment plan, and that alone generates over $4 million in extra revenue for the festival. So they're cashing in on this. Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. If you did, and you have like 12 extra seconds, consider giving us a five-star rating on Apple or Spotify. And if you're listening on Spotify, don't forget to vote in today's Spotify poll.

And leave us a comment on Spotify. All that engagement really does help us out, and it helps other people find the show. Thank you guys so much for listening. Shout out to Mike and Connor for all the help behind the scenes. And we'll see you guys back here tomorrow. This is the rundown. Your real-time resource for news events and trends in the markets. All views presented in the show reflect the opinions of the guests.

You should not take any mention of a publicly traded security as recommendation to buy, sell, or hold that security. Rounddown guests are not financial advisors and are not affiliated with public holdings or its subsidiaries. You should make your own financial and investment decisions or consult. respective professionals. Learn more at public.com disclosures. In partnership with Zaidamani, brokerage services for U.S. listed, registered securities are offered by Open to the Public Investing Incorporated, member FINRA and SIPC.