Evening Briefing: Europe

The Swiss government said it is determined to win over the US on trade after last week’s shock announcement of 39% tariffs on exports to America.

President and Finance Minister Karin Keller-Sutter convened an emergency meeting of the governing Federal Council today to discuss how to proceed — there aren’t many options, but one is to offer to buy liquefied natural gas from the US.

The rate — the highest among industrial nations — caused a surprise in Switzerland; its outsized gold exports, as well as drugs, coffee and watches are partly to blame for a distorted trade balance.

We’re told that Bern is focusing on getting an extension to the Aug. 7 start date, and that it believes any improvement would be a win. — Caroline Alexander

What You Need to Know Today

Tesla approved an interim stock award worth about $30 billion for Chief Executive Officer Elon Musk, a payout meant to keep his attention on the automaker as a legal fight over a 2018 pay package drags on. The move underscores Musk’s grip on the company, even as it struggles with falling electric vehicle sales and a slumping stock price. The world’s richest person has said he wants a greater stake in Tesla as he reorients it around pursuits including artificial intelligence.

Tesla CEO Elon Musk Photographer: Chip Somodevilla/Getty Images

UBS is sounding out investors for a potential significant risk transfer to mitigate the impact of higher capital requirements proposed by the Swiss government; it is considering an SRT tied to CHF2 billion ($2.5 billion) of loans, which may be equivalent to about 3% of the reference portfolio, we’re told. SRTs allow banks to insure loans against default.

Citigroup revised its bearish forecast for gold, with analysts now predicting bullion will rally to a record high in the near term due to a worsening US economy and inflation-boosting tariffs. The precious metal will trade between $3,300 and $3,600 an ounce over the next three months, due in part to US import levies averaging higher than the anticipated 15%, analysts including Max Layton said.

Shares of UK lenders including Lloyds, Close Brothers and Barclays jumped after the industry won a reprieve from the country’s Supreme Court in a pivotal car finance case. The UK’s Financial Conduct Authority will now craft a plan to guide firms on how they should compensate motor finance customers missold car loans.

Was it egregious market manipulation or a legitimate trading strategy? That debate is consuming high-speed traders, after India’s market regulator accused Jane Street of artificially influencing prices of stocks and futures to profit from massive options wagers. The case has put a spotlight on the sometimes hazy boundaries between illicit trading and routine activity like market making and arbitrage. Jane Street has said it did nothing wrong.

South Africa seeks jail time, fines and higher taxes for breaches of proposed rules to govern carbon emissions, which will apply to almost all economic sectors and are due to take effect at the start of next year. South Africa, the most carbon-intensive economy among the G20, is intensifying efforts to cut its dependence on coal for power generation. It’s also seeking to reduce its overall emissions, which rank 15th globally, exceeding those of larger economies like France and the UK.

Behind secure doors near BMW’s Munich headquarters is a sport utility vehicle called the iX3. With slick software, high-performance computers and different design cues, it is the first of 40 new or updated longer-range electric vehicle models. It’s hidden from view because the company’s future is riding on it. And, crucially, for an industry turned on its head by fast-moving Chinese manufacturers leaving even Tesla in the dust, BMW is staging a swift rollout.