Daily Brief | July 23 2025

Top News

·     The Citi Survey anticipates a further cut in the funding rate in early August.

·     The Ministry of Finance will issue Pre-Capitalized Notes, with the aim of strengthening PEMEX’s liquidity position, optimizing its maturity profile, and reducing its liabilities and financial costs. 

·     Donald Trump announced a trade agreement with Japan, in which the latter commits to investing $550 billion in the US and a reciprocal tariff rate of 15%.

·     India and the United Kingdom will sign a free trade agreement next Thursday during Prime Minister Narendra Modi’s visit to London. The agreement will remove trade barriers on whiskey, cars, food, textiles, and electric vehicles. 

Economic Outlook

The Citi Survey anticipates another cut in the funding rate in early August. The consensus of the Citi survey maintained its estimate for economic growth at 0.2% in 2025 and 1.2% in 2026. Compared to the survey conducted in early July, the estimate for 2026 was revised downward by 0.1 percentage points. Within the survey, 10 of the 37 analysts surveyed still estimate a slight decline in GDP for this year. With regard to inflation, the survey revealed that respondents maintained their inflation estimates for this year and next at 4.0% and 3.8%, respectively. On the other hand, the consensus continues to estimate that Banco de México will cut its funding rate by 25 basis points on August 7. By the end of 2025, they expect the funding rate to close at 7.50% and by the end of 2026 at 6.75%. The exchange rate is expected to be 19.85 pesos per dollar (previously 20.0) at the end of this year, while at the end of next year it is expected to be 20.3 pesos per dollar (previously 20.5). Overall, the July fortnightly survey showed little change, but the most important development will be monetary policy at the beginning of next month.

Markets and Stocks

Futures on major US indices were trading higher this morning, boosted by the announcement of a trade agreement between the US and Japan, which sets reciprocal tariffs of 15% and Japanese investment commitments of $550 billion. Investors’ attention is focused on Alphabet and Tesla reports to be released after the close. Tesla’s performance will be especially relevant after becoming the worst-performing stock among the “Magnificent Seven” so far this year. In Europe, markets were trading higher. In Asia, markets closed higher, with a strong rebound in Japan, driven by double-digit earnings at major automakers.

In the commodities market, oil remained slightly down. Although improved global sentiment due to the agreement with Japan offers support, tensions with the European Union and China continue to weigh. Gold, meanwhile, fell 0.4% to $3,417 per ounce.

In the fixed income market, the yield on the 10-year US Treasury bond stood at 4.36%, while the 2-year yield rose to 3.84%.

Alsea presented its Q2 2025 results with solid revenue growth, although with a slight contraction in EBITDA margin. Consolidated net sales grew 13.6% y/y (+14.2% pre-IFRS and without restatement for Argentina). The report reflected strong revenue momentum in Mexico, a recovery in Europe, and positive currency effects. Excluding the exchange rate, sales grew +8.9%. Sales were in line with our expectations, while EBITDA exceeded our estimate.

In 2Q25, Alpek reported a -13% y/y decline in revenue and a -21% decline in comparable EBITDA, affected by global overcapacity, operational disruptions in the Polyester division, and lower volumes. The figures were below our estimate, which we consider a negative implication for the report. Alpek revised its earnings guidance for this year downward.

In 2Q25, Gfnorte reported 8.0% y/y growth in its portfolio, while the financial margin before reserves increased 12.2% y/y and net income +4.3% y/y. The results were in line with expectations in terms of revenue and portfolio, although below expectations in terms of profit. According to the results presentation, Gfnorte is maintaining its guidance for this year. Considering the performance in the first half, we believe that the 2025 figures will be closer to the lower end of the financial group’s guidance.

América Móvil reported consolidated revenues of $234 billion pesos in 2Q25, an increase of 13.8% year-on-year, driven by performance in postpaid mobile services and fixed platforms. EBITDA grew 11.2%, although the margin declined slightly to 39.5% due to higher operating costs. Brazil and Colombia stood out as the most dynamic markets. Net income amounted to $22 billion. The figures were practically in line with projections.

Asur posted weak results in Q2 2025: although revenues grew 17.9% year-on-year to $8.715 billion pesos, this increase was mainly due to revenues from construction services. Excluding this item, growth was 4.8%. Passenger traffic contracted 0.1%, affected by the decline in Cancun (-2.8%) and competition from the Tulum airport. Adjusted EBITDA grew 2.3% and the margin narrowed to 67.6%. Net income fell 41.6%. Although revenues were above our estimate, the contraction in margins gives the report a negative tone.

Fresnillo, a subsidiary of Industrias Peñoles, reported its production report for Q2 2025. The figures reflect pressures on the production of most minerals. However, it is noteworthy that gold production grew 21.3% y/y, thanks to a better ore grade. Silver production was down 14.7%, explained by the cessation of operations at San Julián DOB and a lower ore grade.

Corporate News

– Texas Instruments shares fell nearly 10% prior to the opening bell after projecting a weak third quarter, despite exceeding expectations in its second quarter results.

– Meanwhile, Hasbro shares rose 3% after reporting better-than-expected revenue and earnings, as well as raising its annual guidance, highlighting the performance of its Wizards division.

– Finally, AT&T shares fell despite exceeding revenue and earnings expectations, with strong mobile subscriber additions, although margins were under pressure.