Mercedes-Benz has withdrawn its full-year financial outlook and reported a sharp decline in quarterly earnings, as growing uncertainty surrounding U.S. trade policies continues to unsettle the global automotive sector.

The German carmaker’s shares slipped more than 1 percent by midday Wednesday (CEST) following the announcement, with investors expressing concern over potential fallout from tariffs introduced by the administration of U.S. President Donald Trump.

In a press release, Mercedes-Benz warned that evolving global trade dynamics, especially the U.S. tariff policy and retaliatory actions from other countries, were fueling volatility in the international market. “The US tariff policy, as well as the countermeasures of other governments and the associated changes in tariff rates, are leading to considerable uncertainty for the world economy,” the company stated.

While the automaker operates production facilities across several regions, including a significant base in Germany and a major plant in Tuscaloosa, Alabama, it said it was still too early to quantify the full impact of the trade measures. However, Mercedes hinted it could increase U.S. production in the future to mitigate the effects of new import duties.

Financially, the company reported a 41 percent year-on-year drop in earnings before interest and taxes (EBIT) for the first quarter of 2025, totaling €2.3 billion. Net profit declined by 43 percent to €1.7 billion, and revenue slipped by 7 percent to €33.2 billion. The operating margin in the car division also fell, down 1.7 percentage points to 7.3 percent.

The warnings came despite a slight reprieve from Washington. On Tuesday, President Trump signed an executive order offering partial reimbursement for levies on auto parts imported into the U.S. Additionally, companies paying tariffs on cars and components will be exempt from overlapping duties on steel, aluminum, and goods from Canada and Mexico.

Still, the relief may be temporary. A 25 percent tariff on foreign vehicles came into effect earlier this month, and duties on imported auto parts are set to begin this weekend.

Mercedes-Benz is not alone in sounding the alarm. Several major automakers, including Stellantis, Volvo, and General Motors, have also withdrawn their financial forecasts due to the rapidly shifting trade environment.

Volkswagen, another German giant, reported a 37 percent drop in first-quarter profit on Wednesday, though it maintained its full-year outlook.

As trade tensions escalate, industry leaders are grappling with how to navigate a landscape increasingly shaped by geopolitics and protectionism.

HSBC Holdings Plc has announced a new $3 billion share buyback plan for the first half of 2025, even as it reported a decline in profits and revenue during the first quarter of the year. The move comes amid global economic uncertainty and geopolitical tensions, which the bank says are weighing on business sentiment and financial forecasts.

Europe’s largest bank posted a pre-tax profit of $9.5 billion for the first quarter, down 25% from the same period last year, although the figure still beat analysts’ expectations of $7.8 billion. Revenue for the quarter fell 26% to $17.6 billion. Despite the decline, HSBC shares rose 2.28% by mid-morning trading in London.

The bank attributed the earnings performance to a solid showing from its International Wealth and Premier Banking division, particularly in Hong Kong, as well as strong results in its foreign exchange operations. An interim dividend of $0.10 per share was also approved by the board.

CEO Georges Elhedery, who took the helm in September, said the results reflect “momentum in our earnings, discipline in the execution of our strategy and confidence in our ability to deliver our targets.” He added that the bank remains focused on supporting customers through ongoing economic challenges.

HSBC is in the midst of a significant restructuring aimed at simplifying its operations and cutting costs. Last year, it announced plans to merge its commercial and investment banking divisions. The reorganisation splits its business into two main regions: “Eastern Markets,” which includes Asia-Pacific and the Middle East, and “Western Markets,” covering the UK, Europe, and North America. The bank expects $300 million in cost savings this year, though restructuring costs could reach $1.8 billion over 2025 and 2026.

The bank also warned that economic uncertainty—particularly from protectionist trade policies—is creating volatility in financial markets. HSBC said the ongoing trade tensions between the U.S. and China, its largest market, pose a significant risk. The bank’s stock took a sharp hit after former President Trump announced new tariffs in early April but has since recovered amid a broader market rebound.

Looking ahead, HSBC anticipates continued muted demand for lending and expects a low single-digit percentage hit to group revenue. It also forecasts $500 million in additional expected credit losses tied to downside economic scenarios.

Nonetheless, the bank remains optimistic over the long term, projecting mid-single-digit growth and double-digit gains in its Wealth division over the coming years.

Swiss pharmaceutical giant Novartis reported stronger-than-expected earnings for the first quarter of 2025, buoyed by robust sales of key medicines and rising global demand. The company also raised its full-year guidance, signaling continued confidence in its product pipeline and market performance.

In the three months ending March 31, Novartis reported net sales of $13.2 billion, a 15% increase on a constant currency basis. The figure surpassed analyst expectations, which were estimated at $13.12 billion. Core operating income rose 23% to $5.6 billion, while core net income jumped 22% to $4.5 billion.

Following the strong quarterly performance, Novartis updated its full-year forecast. The company now expects sales to grow by high-single digits and core operating income to increase by low double-digits, narrowing and improving on its previous guidance issued in January.

Sales growth was largely driven by a strong performance across several flagship therapies. Breast cancer drug Kisqali recorded a 56% surge in revenue, reaching $956 million. Entresto, a treatment for heart failure, rose 22% to approximately $2.3 billion, while arthritis medication Cosentyx saw an 18% increase, bringing in around $1.5 billion.

Chief Executive Vas Narasimhan also highlighted progress on the innovation front, citing regulatory approvals for several new drugs. These include Pluvicto for prostate cancer in a pre-taxane setting, Vanrafia for IgA nephropathy, and Fabhalta for C3 glomerulopathy (C3G). “We remain focused on advancing our leading pipeline and confident in achieving our growth outlook,” Narasimhan stated in the earnings release.

The company is also navigating shifting regulatory and trade dynamics in the United States. A recent White House-initiated national security review of the pharmaceutical sector has raised questions about potential tariffs. While pharmaceuticals are currently exempt from proposed “reciprocal” tariffs, former President Donald Trump has floated a 25% import levy on medicines.

In response, Novartis recently announced a $23 billion investment plan in the U.S. over the next five years. The initiative includes the construction and expansion of 10 manufacturing facilities, with the goal of ensuring all medications for U.S. patients are produced domestically.

Novartis’s performance and expansion plans underscore the company’s strategic focus on growth through innovation and localized production amid global uncertainty.