Markets climb higher on strong economic data

Dow jumped up 225, advancers over decliners about 2-1 & NAZ gained 20.  The MLP index added 1+ to the 265s & the REIT index gave back 2+ to the 356s (still at high levels after its recent rally).  Junk bonds funds fluctuated & Treasuries were sold.  Oil slid lower in the 73s & gold went up 7 to 1262 following recent weakness.

AMJ (Alerian MLP Index tracking fund)

CL=F

Crude Oil

73.75

-0.05

-0.1%

GC=F

Gold

1,263.60

+7.80

+0.6%

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Stocks were bid higher to start the week, adding to gains from the Fri session that was powered by a better-than-expected jobs report.  Chinese shares bounced despite heightened trade tensions between Washington & DC after each imposed major tariffs on the other's goods last week.  The Shanghai Composite ended the session 2.5%, its biggest one-day rise in 2-years.  Japan's Nikkei ended the day up 1.2%.  In Europe, London’s FTSE traded 0.4% higher, Germany's DAX gained 0.1% & France's CAC was higher by 0.4%.  Stocks rose Fri after a strong jobs report overshadowed US-China tariffs.  The Dow climbed 99 (0.4%) to 24,456 & the S&P 500 rose 23 (0.8%) to 2759.  NAZ rallied 101 (1.3%) to 7688.  The US economy added 213K jobs in Jun with the unemployment rate rising to 4%.  Wage growth remained steady at 2.7% even though hourly wages inched higher by 0.2%.  The foecast called for the economy to add 195K jobs in Jun with the unemployment rate holding steady at May's 3.8% (the lowest since 2000).  Commodities were mostly higher.

Stock rally continues following jobs report

Major Chinese ports have started clearing goods from the US today, as new tariffs on US imports have gone into effect, as a trade spat between Beijing & DC escalated into an outright war last Fri.  Customs officers had delayed the clearance of some US goods on China's penalty list last Fri, as they waited for official instructions from the central gov on whether to start collecting the new import tariffs.  Local customs at the port of Qingdao have let thru American products they held up on Fri & imposed higher tariffs on the goods.  Shanghai customs has also started collecting new tariffs as of today on imported fruits & wine, among other US products on the new tariff lists.  Beijing had said that China's punitive tariffs on US products would immediately take effect after America imposed penalties on Chinese goods worth a similar amount.  However, the absence of an official confirmation earlier Fri had caused confusion in the markets, leaving customs at major ports in limbo.  Later that day, China's foreign ministry spokesperson announced that China has begun implementing new tariffs of 25% on some US goods including automobiles & soybeans.

Chinese customs clears some US goods as new tariffs take effect: sources

China's commerce ministry says that Beijing will use revenues from higher import duties on US products will be used to help companies that may be hurt by the trade dispute with DC.  Higher duties on U.S goods went into effect on Fri as the US imposed 25% tariffs on roughly $34B of Chinese products.  The commerce ministry statement issued today said Beijing will use the increased revenue to "alleviate the impact on enterprises and employees," but gave no details.  Importers would be encouraged to shift to buying soybeans & other farm goods from countries that aren't affected by the tariffs.  Chinese exporters are scrambling to cope with a plunge in US orders while China's state press shrugged off the impact of  the US tariff hikes in a spiraling technology dispute.  The overall blow from Fri's tariff hikes to the world's 2nd-largest economy should be limited.  But Pres Trump's measures targeting Chinese medical, construction & factory equipment hit small exporters that say price-conscious American customers have stopped buying.

The Latest: China says tariffs to offset trade war fallout

Germany's Finance Ministry says authorities are examining a request from Iran to repatriate hundreds of Ms of €s in cash held in a Hamburg-based bank.  The Iranian regime wants to bring home €300M ($353M) it has in the European-Iranian Trade Bank to have on hand when American financial sector sanctions come into effect.  Finance Ministry Jeanette Schwamberger confirmed the request had been made & says it's now being checked by financial regulators as are all large transactions involving countries where there might be possible "money laundering or terror financing."  She says "should the checks turn up anything suspicious then the result would be the transaction cannot be completed."  She added that she has no overall figure for Iranian holdings in Germany.

Germany examining Iranian request to move $353 mil cash home

The bulls liked what they saw in the Fri data & are bidding stocks higher.  As higher tariffs between the US & China begin, there is a lot of confusion on how they will play out.  Today those worries are fading.  However they are not going away & buyers are purchasing gold.  For the time being, the Dow is heading for 25K (still 300 away) even with dark clouds of tariff wars in the sky.

Dow Jones Industrials