The Day at a Glance | February 25 2025

The Top

• Mexico’s trade balance began 2025 with a $4.558 billion deficit.

• President Donald Trump will decide on global tariff policy, including measures affecting Mexico and Canada, after studies are set to be released on April 1^st, according to Kevin Hassett, White House economic adviser.

• The US president threatened to impose 25% reciprocal tariffs on the European Union, including the automotive sector.

• In the week ending February 22^nd, 2025, initial unemployment insurance claims in the US reached 242,000 (221,000 expected), rising from 220,000 the previous week.

• US 4Q24 GDP increased 2.3% at an annualized quarterly rate, according to the second of three estimates released by the Bureau of Economic Analysis.

• Oil prices rose more than 1% on concerns over tighter supply after President Trump revoked Chevron’s license to operate in Venezuela.

Economic Environment

Mexico’s trade balance began 2025 with a $4.558 billion deficit. In the first month of 2025, the trade deficit (exports minus imports) stood at $4.558 billion, compared to a $4.134 billion deficit reported a year earlier. In January 2025, exports increased 5.5% y/y, signaling an 8.7% increase in non-oil exports and a 40.6% decline in oil exports. Within non-oil exports, agricultural exports rose 6.1% y/y, mineral extractive exports 15.2% y/y, and manufacturing exports 8.8% y/y. Imports increased 5.9% y/y in the first month of 2025, driven by a 5.0% rise in oil imports and a 6.0% increase in non-oil imports. By type of goods, consumer goods and capital goods imports decreased 5.6% and 8.5%, respectively, while intermediate goods imports rebounded 10.4%. Overall, the trade balance started the year with a slightly larger deficit than last year, though still within its typical seasonal pattern. At this point, the deficit is not concerning, as the rebound in intermediate goods imports suggests that exports could continue to increase in the coming months.

Markets and Companies

US stock futures were trading higher this morning, driven by Nvidia’s earnings, which exceeded market expectations with a 78% revenue increase and a strong outlook for the next quarter. However, uncertainty surrounding US trade policy persists after President Donald Trump threatened new 25% tariffs on imports from the European Union. In Europe, markets were declining, while in Asia, they closed higher.

In the commodities market, oil prices were rebounding after the US revoked Chevron’s license to operate in Venezuela, while gold decreased to $2,886 per ounce.

In fixed income, the 10-year Treasury yield stood at 4.30%, while the 2-year yield reached 4.10%.

As for the IPC, futures were trading higher, while the exchange rate stood at 20.39 pesos per dollar, compared to 20.41 yesterday.

In 4Q24, Funo reported an 11.0% y/y increase (vs. 10.0%e) in total revenue. Net Operating Income (NOI) grew 9.1% y/y (vs. 7.3%e). Meanwhile, Funds from Operations (FFO) rose 8.6%. Results were in line with expectations at the revenue level and better than our estimate in terms of cash flow.

In 4Q24, Gentera’s total loan portfolio reached $82.742 billion pesos, signaling 27.0% annual growth. The financial margin, before provisions, rose 27.0% y/y, while net income increased 55.8% y/y. Results exceeded expectations, leading to a positive outlook on the report.2025 could be another strong year: Gentera’s guidance projects loan portfolio growth between 13% and 16% this year, while net income is expected to grow between 20% and 24%.

Femsa released its 4Q24 results this morning, delivering a very positive report. Consolidated revenue increased 12.8%, driven by growth across all business units and favorable exchange rate effects. Adjusted EBITDA rose 25.9%, with the margin expanding 170 basis points.

Livepol will report its quarterly results this afternoon. We expect consolidated revenue to grow around 8.5% in 4Q24, supported by promotional campaigns such as El BuenFin and the Venta Nocturna. However, we anticipate margin pressure due to higher operating expenses and an increase in provisions for bad debts.

We expect Industrias Peñoles to report its results today, with revenue driven by the strong performance of precious metals in 2024 and a positive impact from the exchange rate.

Corporate News

• Nvidia exceeded expectations with $39.3 billion in revenue for the quarter, driven by strong demand for its AI chips. However, investors see a slowdown compared to previous quarters.