Dow jumped up 669 (closing near session highs), advancers over decliners
about 3-1 & NAZ soared 227. The MLP index went up 1+ to the 239s
& the REIT index was off to the 317s. Junk bond funds rose
along with stocks & Treasuries only fluctuated. Oil was lower
in the 65s & gold gained 4 to 1353.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif?0.1345410888752141)
US equities surged back from the biggest weekly rout in more than 2 years, with major benchmarks climbing over 2% on signs that an escalation of trade tensions was beginning to ease. Chipmakers & banks led gains on the S&P 500, which had for its biggest one-day gain since late 2016. Facebook (FB) sat out the rally, slumping after the Federal Trade Commission said it has an open, non-public investigation into the company's privacy practices. 10-year Treasury yields edged higher ahead of major debt sales . The $ dropped to a one-month low & European shares slid for a 4th day as investors remain on edge over the region's growth prospects. The worst global stocks rout since early Feb gave way to a more optimistic mood as the limits of the administration's willingness to embrace protectionism came into view. Treasury Sec Steve Mnuchin said that he’s "cautiously optimistic" that China will reach a deal to avoid tariffs on $50B of US exports, while European leaders demanded a permanent exclusion at the threat of retaliation & a deal was struck with South Korea. Brent crude traded near $70 a barrel on lingering tension in the Middle East. A measure of US corp junk bonds rose the most in 3 weeks. The € advanced to the strongest since mid-Feb.
U.S. Stocks Roar Back; Dow Climbs More Than 500 Points
China asked the US to provide compensation for lost trade due to Pres Trumps's proposed tariffs on steel & aluminum, in a preliminary step that could lead to a dispute between the 2 nations at the World Trade Organization (WTO). In 2 filings with the WTO today, China dismissed the US assertion that the metal tariffs were instituted on national security grounds, arguing instead that they were safeguard measures, temporary trade restrictions aimed at protecting domestic producers. China responded to the US action by threatening to impose tariffs on $3B of US imports, including agricultural, steel & aluminum products, & its ambassador to the US said all options are on the table, though the Asian nation doesn't want a trade war. The levies are expected to affect $689M worth of Chinese steel & aluminum exports to the US, according to data published by the Peterson Institute for Intl Economics. If the US rejects China's argument that the measures are safeguards, China may have recourse to ask the WTO to mediate the disagreement in a formal dispute proceeding. China said it reserved the right to file a dispute at a later date. Separately, the EU took the first step toward protecting EU-based steel manufacturers today when the European Commission opened a “safeguard” probe into whether the 25% levy on foreign steel imposed last week by Trump is diverting worldwide shipments to the EU market. The probe marks the defensive part of a 3-pronged strategy that the EU has drawn up to respond to the US steel tariff & to a levy on foreign aluminum.
China Asks U.S. to Offset Trade Loss Due to Metal Tariffs
The Trump administration is urging China to lower tariffs on cars & open its market to US financial services as part of talks to resolve a rise in trade tensions that has shaken global markets. Treasury Sec Steve Mnuchin called China's Liu He to congratulate Liu on his appointment this month as vice premier in charge of economic policy. The 2 discussed the trade deficit between the 2 countries 2 committed to finding a mutually agreeable way to reduce the gap, adding they have exchanged correspondence (according to a leaker). Meanwhile, one of Pres Trump's senior trade advisers says the pres is seeking a nearly 1/3 narrowing of the US trade deficit with China. Trump wants to see a $100B reduction in America's trade deficit with China this year, as well as action on intellectual property, White House trade adviser Peter Navarro said. The US had a $337B trade shortfall with China last year. “We are already at the negotiating table,” he said. Mnuchin & US Trade Representative Robert Lighthizer “actively engage with the Chinese side,” Navarro said. “The problem is talk isn’t cheap with the Chinese side. It’s been very expensive” for the U.S., he added.
U.S. Pushes China on Cars and Finance in Tariff Talk
The Trump administration detailed a trade deal that it reached with South Korea today, which permanently exempts the US ally from newly implemented steel tariffs, but maintains a quota on imports from the country. The quota on South Korean steel imports is 2.68M tons of steel per year (70% of its annual average sale to the US over the past 3 years). In exchange for the exemption, South Korea will open its markets to US-manufactured autos, expanding the number of cars it imports per manufacturer to 50K, from 25K. Meanwhile, the US will extend a tariff on pickup trucks, which was set to expire in 2021, for an additional 2 decades. The 25% tariff impacts prominent South Korean auto manufacturers, including Hyundai & Kia. South Korea has also been impacted by the administration's decision in Jan to impose steep tariffs & quotas on imported washing machines. Treasury Sec Steve Mnuchin called the deal, which had yet to be detailed at the time, an “absolute win-win” for both countries. When asked about Trump's method of using tariffs as a negotiating tactic, Mnuchin mentioned the agreement with South Korea as an example of how his approach was working. “I think the strategy has worked, quite frankly,” he added. “So we announced the tariff. We said we were going to proceed. But, again, we said we'd simultaneously negotiate.” Trump announced tariffs on aluminum imports earlier this month, declaring shortly thereafter that countries could apply for an exemption. NAFTA partners Mexico & Canada are exempt, while members of the EU, along with countries like Brazil, are also expected to be immune. The revision to the 2 countries' trade deal comes as Pres Trump is set to meet with North Korean leader Kim Jong Un. It also follows an announcement last week that the US will impose tariffs worth $50B on a variety of Chinese goods.
South Korea steel exports to US put under quota
club.ino.com/trend/analysis/stock/BA?a_aid=CD3289&a_bid=6ae5b6f7
An oversold stock market had an outstanding day. NAZ, which has been under selling pressure, was flying high. Market breadth, however, was so-so given the strength shown by the popular averages. Another way to look at the market advance is the Dow is down 500 YTD while volatility is substantially higher. There was only one decliner in the Dow, General Electric (GE), which has been in the doghouse for months. Indications of improvement in talks with China about trade will be a major driver stocks for the balance of the week. That is unclear with increased uncertainty.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
US equities surged back from the biggest weekly rout in more than 2 years, with major benchmarks climbing over 2% on signs that an escalation of trade tensions was beginning to ease. Chipmakers & banks led gains on the S&P 500, which had for its biggest one-day gain since late 2016. Facebook (FB) sat out the rally, slumping after the Federal Trade Commission said it has an open, non-public investigation into the company's privacy practices. 10-year Treasury yields edged higher ahead of major debt sales . The $ dropped to a one-month low & European shares slid for a 4th day as investors remain on edge over the region's growth prospects. The worst global stocks rout since early Feb gave way to a more optimistic mood as the limits of the administration's willingness to embrace protectionism came into view. Treasury Sec Steve Mnuchin said that he’s "cautiously optimistic" that China will reach a deal to avoid tariffs on $50B of US exports, while European leaders demanded a permanent exclusion at the threat of retaliation & a deal was struck with South Korea. Brent crude traded near $70 a barrel on lingering tension in the Middle East. A measure of US corp junk bonds rose the most in 3 weeks. The € advanced to the strongest since mid-Feb.
U.S. Stocks Roar Back; Dow Climbs More Than 500 Points
China asked the US to provide compensation for lost trade due to Pres Trumps's proposed tariffs on steel & aluminum, in a preliminary step that could lead to a dispute between the 2 nations at the World Trade Organization (WTO). In 2 filings with the WTO today, China dismissed the US assertion that the metal tariffs were instituted on national security grounds, arguing instead that they were safeguard measures, temporary trade restrictions aimed at protecting domestic producers. China responded to the US action by threatening to impose tariffs on $3B of US imports, including agricultural, steel & aluminum products, & its ambassador to the US said all options are on the table, though the Asian nation doesn't want a trade war. The levies are expected to affect $689M worth of Chinese steel & aluminum exports to the US, according to data published by the Peterson Institute for Intl Economics. If the US rejects China's argument that the measures are safeguards, China may have recourse to ask the WTO to mediate the disagreement in a formal dispute proceeding. China said it reserved the right to file a dispute at a later date. Separately, the EU took the first step toward protecting EU-based steel manufacturers today when the European Commission opened a “safeguard” probe into whether the 25% levy on foreign steel imposed last week by Trump is diverting worldwide shipments to the EU market. The probe marks the defensive part of a 3-pronged strategy that the EU has drawn up to respond to the US steel tariff & to a levy on foreign aluminum.
China Asks U.S. to Offset Trade Loss Due to Metal Tariffs
The Trump administration is urging China to lower tariffs on cars & open its market to US financial services as part of talks to resolve a rise in trade tensions that has shaken global markets. Treasury Sec Steve Mnuchin called China's Liu He to congratulate Liu on his appointment this month as vice premier in charge of economic policy. The 2 discussed the trade deficit between the 2 countries 2 committed to finding a mutually agreeable way to reduce the gap, adding they have exchanged correspondence (according to a leaker). Meanwhile, one of Pres Trump's senior trade advisers says the pres is seeking a nearly 1/3 narrowing of the US trade deficit with China. Trump wants to see a $100B reduction in America's trade deficit with China this year, as well as action on intellectual property, White House trade adviser Peter Navarro said. The US had a $337B trade shortfall with China last year. “We are already at the negotiating table,” he said. Mnuchin & US Trade Representative Robert Lighthizer “actively engage with the Chinese side,” Navarro said. “The problem is talk isn’t cheap with the Chinese side. It’s been very expensive” for the U.S., he added.
U.S. Pushes China on Cars and Finance in Tariff Talk
The Trump administration detailed a trade deal that it reached with South Korea today, which permanently exempts the US ally from newly implemented steel tariffs, but maintains a quota on imports from the country. The quota on South Korean steel imports is 2.68M tons of steel per year (70% of its annual average sale to the US over the past 3 years). In exchange for the exemption, South Korea will open its markets to US-manufactured autos, expanding the number of cars it imports per manufacturer to 50K, from 25K. Meanwhile, the US will extend a tariff on pickup trucks, which was set to expire in 2021, for an additional 2 decades. The 25% tariff impacts prominent South Korean auto manufacturers, including Hyundai & Kia. South Korea has also been impacted by the administration's decision in Jan to impose steep tariffs & quotas on imported washing machines. Treasury Sec Steve Mnuchin called the deal, which had yet to be detailed at the time, an “absolute win-win” for both countries. When asked about Trump's method of using tariffs as a negotiating tactic, Mnuchin mentioned the agreement with South Korea as an example of how his approach was working. “I think the strategy has worked, quite frankly,” he added. “So we announced the tariff. We said we were going to proceed. But, again, we said we'd simultaneously negotiate.” Trump announced tariffs on aluminum imports earlier this month, declaring shortly thereafter that countries could apply for an exemption. NAFTA partners Mexico & Canada are exempt, while members of the EU, along with countries like Brazil, are also expected to be immune. The revision to the 2 countries' trade deal comes as Pres Trump is set to meet with North Korean leader Kim Jong Un. It also follows an announcement last week that the US will impose tariffs worth $50B on a variety of Chinese goods.
South Korea steel exports to US put under quota
Boeing
(BA), a Dow stock, delivered its first 787-10 Dreamliner to
Singapore Airlines, rounding out a family of lightweight jets
on which the planemaker is betting its future. The
ceremonial key to the plane was handed to Singapore Airlines CEO Goh
Choon Phong at BA's South Carolina
plant, where the carbon composite jet is built, in front of more than a
thousand workers & guests. Goh called it a "beautiful aircraft"
& an "unparalleled product for regional operations." BA CEO
Keith McAllister hailed the 2 airlines' 45-year relationship. Singapore
Airlines was the first Southeast Asian
carrier to buy Boeing's 747 jumbo jet in 1972, Goh said, & is
now the
world's first to operate all the 787 Dreamliner family of models. The
new Dreamliner was parked in front of a line of about 10 787 airplanes
in various stages of completion. The 787-10
is built exclusively at the North Charleston plant due to its large
size, which prevents the transfer of sections to its factory
outside Seattle. Unlike the Washington state assembly lines, the plant,
which has about 7K workers, is not unionized. The
aircraft, which sells for $326M at list prices, completes a
line-up of 3 models starting with the 787-8 which debuted in 2011.
All boast carbon-composite fabrication materials, fuel efficiency
&
new state-of-the-air filtration systems with higher levels of humidity
in the air for long-distance flight. The 787-10's range is 6430
nautical miles. At
223 feet long, the aircraft is 18 feet longer
than the 787-9 & seats around 330 passengers, 40 more than the
787-9 & 88 more than the 787-8. The stock soared 8.
If you would lilke to learn more about BA, click on this link:club.ino.com/trend/analysis/stock/BA?a_aid=CD3289&a_bid=6ae5b6f7
Boeing completes Dreamliner family with first 787-10 delivery
An oversold stock market had an outstanding day. NAZ, which has been under selling pressure, was flying high. Market breadth, however, was so-so given the strength shown by the popular averages. Another way to look at the market advance is the Dow is down 500 YTD while volatility is substantially higher. There was only one decliner in the Dow, General Electric (GE), which has been in the doghouse for months. Indications of improvement in talks with China about trade will be a major driver stocks for the balance of the week. That is unclear with increased uncertainty.
Dow Jones Industrials
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