Dow dropped 222, declines over advancers better than 3-1 & NAZ sank a very big 103. The MLP index tumbled 7+ to 245 & the REIT index added 2 to the 331s. Junk bond funds were mixed & Treasuries slid back slightly. Oil was fractionally lower in the 62s & gold did little at 1311.
AMJ (Alerian MLP Index tracking fund)
Stocks declined globally amid a technology selloff & as investors braced for a week packed with risk events, from central bank decisions to a G-20 gathering. Gov bonds also fell, while the £ jumped on a Brexit breakthrough. US stock slumped as tech companies were roiled by weekend reports of a Facebook (FB) & Apple (AAPL, a Dow & NAZ stock) efforts to develop its own screens. That sapped Asian equities, while tech also led a retreat for the Stoxx Europe 600 Index. The gauge's drop threatens to trigger a trading pattern known as a “death cross,” a bearish sign for many technical analysts. Sterling rallied as the UK & EU reached a deal on the transition agreement for the period immediately after Brexit. The ¥ fluctuated before slipping amid a drop in support for Japanese Prime Minister Shinzo Abe's cabinet. In a busy week, the biggest focus for global markets will be the first US interest rate decision under new Federal Reserve Chairman Jerome Powell. It comes after he hinted to investors that he's open to lifting the policy rate 4 times this year, rather than the 3 currently reflected in dot-plot forecasts. Some analysts expect the projection to rise to 4 on Wed, while others say there will be no change following a round of mediocre data & policy makers' stated intentions to move gradually. Trade tensions also remain in the spotlight as US Treasury official David Malpass said he misspoke hours after claiming America was pulling out of decade-old formal economic talks with Beijing. Meanwhile, investors are assessing the implications of a new head at China's central bank. The ruble weakened for a 6th day, the longest losing streak since Oct, as Russian Pres Putin won a landslide victory in a tightly controlled election. West Texas oil edged lower.
Stocks Slide in Broad Selloff
The Chamber of Commerce & 44 other associations are urging Pres Trump not to impose sweeping tariffs in response to China's trade practices, warning the action would “trigger a chain reaction of negative consequences for the U.S. economy.” The business groups wrote a letter to Trump acknowledging “serious concerns” regarding what they described as China's theft of trade secrets & other practices and policies, but they urged a measured response that avoided tariffs. “The Administration should not respond to unfair Chinese practices and policies by imposing tariffs or other measures that will harm U.S. companies, workers, farmers, ranchers, consumers, and investors,” the groups said in the letter. Trump has announced he would impose tariffs of 25% on steel & 10% on aluminum, with some exclusions & exceptions, to curb cheap imports from China & other countries. The administration is also considering clamping down on Chinese investments in the US & imposing tariffs on a broad range of its imports to punish Beijing for alleged theft of intellectual property. Sweeping tariffs would provoke retaliation, stifling US exports & raising costs for businesses & consumers, the groups said. They highlighted the potential impact, including higher prices for electronics, apparel & other products, & harming US companies that sell component pieces of final products exported from China. US manufacturers would face more expensive product components & disrupted supply chains, affecting jobs. Manufactured products comprised more than 85% of exported goods from the US in 2017, totaling $1.3T. Tariffs that result in reduced consumption of products would also depress financial markets. They urged the administration to work with them to find effective, alternative responses to Chinese trade practices.
Dozens of US Business Groups Warn Trump Against China Tariffs
The UK & EU have reached a deal on the transition agreement that businesses are keen to get pinned down for the period immediately after Brexit. Brexit Secretary David Davis & chief EU negotiator Michel Barnier briefed reporters in Brussels. Leaders are expected to sign off on the agreement at a summit on Thurs & Fri. The UK has been trying to secure a written promise from the EU about the transition agreement. Businesses are cranking up the pressure to make the transition as solid, & useful, as possible. They are becoming increasingly aware that any agreement reached at the summit this week will be a political commitment, not legally binding until the final withdrawal agreement is signed early next year.
EU, U.K. Reach Brexit Transition Deal
FB, a darling of many investors, is having a very ugly day & that selling is bleeding into the rest of the stock market. Meanwhile, other dark clouds are around. The Fed meeting is always big for investors who have become addicted to low interest rates. Tariff uncertainties remain worrisome. Then there is the routine chaos coming out of DC. So stocks are having tough time bringing back the multi year rally. Just look at the Dow chart below.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 62.08 | -0.26 | -0.4% |
| GC=F | Gold | 1,313.30 | +1.00 | +0.1% |
Stocks declined globally amid a technology selloff & as investors braced for a week packed with risk events, from central bank decisions to a G-20 gathering. Gov bonds also fell, while the £ jumped on a Brexit breakthrough. US stock slumped as tech companies were roiled by weekend reports of a Facebook (FB) & Apple (AAPL, a Dow & NAZ stock) efforts to develop its own screens. That sapped Asian equities, while tech also led a retreat for the Stoxx Europe 600 Index. The gauge's drop threatens to trigger a trading pattern known as a “death cross,” a bearish sign for many technical analysts. Sterling rallied as the UK & EU reached a deal on the transition agreement for the period immediately after Brexit. The ¥ fluctuated before slipping amid a drop in support for Japanese Prime Minister Shinzo Abe's cabinet. In a busy week, the biggest focus for global markets will be the first US interest rate decision under new Federal Reserve Chairman Jerome Powell. It comes after he hinted to investors that he's open to lifting the policy rate 4 times this year, rather than the 3 currently reflected in dot-plot forecasts. Some analysts expect the projection to rise to 4 on Wed, while others say there will be no change following a round of mediocre data & policy makers' stated intentions to move gradually. Trade tensions also remain in the spotlight as US Treasury official David Malpass said he misspoke hours after claiming America was pulling out of decade-old formal economic talks with Beijing. Meanwhile, investors are assessing the implications of a new head at China's central bank. The ruble weakened for a 6th day, the longest losing streak since Oct, as Russian Pres Putin won a landslide victory in a tightly controlled election. West Texas oil edged lower.
Stocks Slide in Broad Selloff
The Chamber of Commerce & 44 other associations are urging Pres Trump not to impose sweeping tariffs in response to China's trade practices, warning the action would “trigger a chain reaction of negative consequences for the U.S. economy.” The business groups wrote a letter to Trump acknowledging “serious concerns” regarding what they described as China's theft of trade secrets & other practices and policies, but they urged a measured response that avoided tariffs. “The Administration should not respond to unfair Chinese practices and policies by imposing tariffs or other measures that will harm U.S. companies, workers, farmers, ranchers, consumers, and investors,” the groups said in the letter. Trump has announced he would impose tariffs of 25% on steel & 10% on aluminum, with some exclusions & exceptions, to curb cheap imports from China & other countries. The administration is also considering clamping down on Chinese investments in the US & imposing tariffs on a broad range of its imports to punish Beijing for alleged theft of intellectual property. Sweeping tariffs would provoke retaliation, stifling US exports & raising costs for businesses & consumers, the groups said. They highlighted the potential impact, including higher prices for electronics, apparel & other products, & harming US companies that sell component pieces of final products exported from China. US manufacturers would face more expensive product components & disrupted supply chains, affecting jobs. Manufactured products comprised more than 85% of exported goods from the US in 2017, totaling $1.3T. Tariffs that result in reduced consumption of products would also depress financial markets. They urged the administration to work with them to find effective, alternative responses to Chinese trade practices.
Dozens of US Business Groups Warn Trump Against China Tariffs
The UK & EU have reached a deal on the transition agreement that businesses are keen to get pinned down for the period immediately after Brexit. Brexit Secretary David Davis & chief EU negotiator Michel Barnier briefed reporters in Brussels. Leaders are expected to sign off on the agreement at a summit on Thurs & Fri. The UK has been trying to secure a written promise from the EU about the transition agreement. Businesses are cranking up the pressure to make the transition as solid, & useful, as possible. They are becoming increasingly aware that any agreement reached at the summit this week will be a political commitment, not legally binding until the final withdrawal agreement is signed early next year.
EU, U.K. Reach Brexit Transition Deal
FB, a darling of many investors, is having a very ugly day & that selling is bleeding into the rest of the stock market. Meanwhile, other dark clouds are around. The Fed meeting is always big for investors who have become addicted to low interest rates. Tariff uncertainties remain worrisome. Then there is the routine chaos coming out of DC. So stocks are having tough time bringing back the multi year rally. Just look at the Dow chart below.
Dow Jones Industrials
No comments:
Post a Comment