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Daily Update — May 22, 2025

S&P 500 Faces Tariff Uncertainty; Russia Targets EU Carbon Policies; and AI and Storage

Today is Thursday, May 22, 2025, and here’s your curated selection of Essential Intelligence on global markets from S&P Global. Subscribe to be notified of each new Daily Update.

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Economy

S&P 500 valuations stumble on tariff uncertainty

 

Following President Donald Trump's April 2 announcement of tariffs affecting nearly all US trading partners, the S&P 500 declined to its lowest point since November 2023. On April 7, the index's daily forward price-to-earnings (P/E) ratio dropped to just over 19, indicating a sharp decrease in stock prices.

 

This decline marked a notable contrast to late January, when the P/E ratio surged to its highest level since April 2021, indicating that stocks were perceived as increasingly overvalued as the index hit record highs. Although the forward P/E ratio has rebounded to the levels of early March, questions remain about whether the current valuation, which is still considerably above pre-pandemic figures, is justified.

Energy Transition & Sustainability

Russia targets EU carbon policies in WTO showdown

 

Russia recently initiated a formal dispute at the World Trade Organization against the EU's carbon border tax and emissions trading system, characterizing the policies as "discriminatory. Russia argued that the EU's mechanisms are not genuine environmental measures, but trade-restrictive practices disguised as climate policy.

 

This legal challenge represents the first significant opposition to the EU's climate initiatives at the WTO and follows recent expressions of concern from China and its BRICS allies, indicating rising tensions in global climate negotiations. While China has voiced its apprehensions regarding the Carbon Border Adjustment Mechanism within the WTO, it has not lodged an official complaint. The EU maintains that its carbon tariff complies with WTO regulations and said that it aims to create a level playing field for trade while supporting environmental goals.

 

Explore Platts Carbon Credit Assessments. Platts is a part of S&P Global Commodity Insights.

Artificial Intelligence

Listen: AI and Storage

 

Amid the significant attention on AI, it’s easy to overlook the importance of understanding the foundations that provide the data on which AI is built. Databases and storage infrastructure are critical components that have to work in concert with AI plans. 

 

S&P Global Market Intelligence 451 Research’s storage channel research director Henry Baltazar and senior research analyst James Curtis joined host Eric Hanselman on this episode of the “Next in Tech” podcast to discuss recent developments in the sector and what enterprises need to know.

In case you missed it

  • Sovereign-sponsored and politically motivated cyberattacks on critical infrastructure in the US have become more frequent, resulting in a heightened risk of infrastructure failures that could cause significant economic disruptions and loss of life.
  • LNG Canada is expected to ship its first cargo to Asia within weeks, Petronas CEO Tengku Muhammad Taufik said recently during the World Gas Conference in Beijing. Petronas holds a 25% stake in LNG Canada.
  • The ongoing conflict in the Red Sea continues to transform global shipping routes and commodity trades. With some vessels potentially returning to the Suez Canal route, European oil product markets may face pressure from increased supply flows.

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