Dow shot up 99, advancers over decliners 3-1 & NAZ advanced a big 101. The MLP index gained 2+ to the 264s & the REIT index continued strong, adding 1 to the 358s. Junk bond funds remained lower & Treasuries inched higher in price. Oil rose to the 73s (more below) & gold lost 2 to 1256.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
Pres Trump has vowed that "trade wars are good and easy to win." But as the US made good on threats to impose steep trade tariffs on China, it was hard to identify any beneficiaries. And because Trump has spurned long-standing rules that call for trade disputes to be handled by the World Trade Organization, there is little hope for a short-term resolution, according to Matthew Gold, a former US trade negotiator. “The other countries involved really can’t negotiate,” he said. “The only option is to retaliate.” As of midnight in DC, the Trump administration began imposing tariffs on as much as 25% on $34B in Chinese imports. In response, China implemented retaliatory tariffs on some imports from the US, said its foreign ministry. The Trump administration initiated the dispute in Apr, announcing the tariffs & accusing China of using “unfair” tactics to build a large trade surplus with the US & expropriating American technology. The White House has also pressed Congress to tighten rules on Chinese investment in US technology. “These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs,” Trump said. Despite the urging of business groups & lawmakers to negotiate a truce, there is little that the 2 sides would reach a compromise anytime soon. Beijing & DC had held several rounds of high-level talks since early May, but the Trump administration has said it is considering expanding the list of targeted Chinese imports. Trump has threatened additional 10% tariffs on another $200B in Chinese goods if Beijing proceeds with its own retaliatory tariffs. When China retaliates, higher tariffs will hit American exports from cars to soybeans. That would bring the trade war home to states that rely on agriculture & manufacturing, many of which supported Trump in the presidential election. American soybean farmers send about 60% of their crop to China. So far, the tariffs represent a relatively small portion of US-China trade. That means the immediate economic impact of the trade war could be limited for both sides, another reason some analysts expect the dispute to linger for some time.
US crude rises 1.2 percent, settling at $73.80, but posts weekly loss
Pres Trump wants to establish a post-Brexit bilateral trade deal with the UK "as soon as possible," the US ambassador to the UK said. The Trump administration has committees "from every department" dedicated to figuring out how to put together a US-UK trade deal "really rapidly and efficiently" following Britain's exit from the EU, Ambassador Robert "Woody" Johnson said. "He would love to do a bilateral trade deal, and he is really ready to step up on that the minute we get the go ahead to do it. He will get it done fast because I know it is a major priority for him," Johnson added. The commitment to a bilateral deal followed remarks about Trump's upcoming trip to the UK, where the pres is scheduled to meet with both Prime Minister Theresa May & the Queen. The mission of the trip is to "strengthen the special relationship" between the 2 nations "through shared security and prosperity,” Johnson said. The visit with one of the US's oldest & strongest allies will be bookended by 2 other European summits scheduled in Jul. The UK trip will directly follow Trump's summit with members of NATO. And after spending the weekend in Scotland, Trump will head to Helsinki to meet with Russian Pres Putin on Jul 16. Johnson said Trump was impartial toward the type of Brexit that Britain ends up enacting, whether the clean-break departure from the EU known as a "hard Brexit," or the "soft" version that would preserve some ties between Britain & the EU. "Whether it’s hard or soft, we know great Britain is going to do very well," Johsnon said.
Trump wants a bilateral UK trade deal 'as soon as possible,' US ambassador says
The jobs report was good enough to bring out the bulls today. The data looks good & traders are hoping that a strong US economy will be able to handle problems with trade negotiations. But trade problems are not going away anytime soon & have the potential to be a major drag on economies across the globe. The Dow continues to hold above 24K, although the longer term chart below does not looks encouraging, especially for the balance of the year..
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Pres Trump has vowed that "trade wars are good and easy to win." But as the US made good on threats to impose steep trade tariffs on China, it was hard to identify any beneficiaries. And because Trump has spurned long-standing rules that call for trade disputes to be handled by the World Trade Organization, there is little hope for a short-term resolution, according to Matthew Gold, a former US trade negotiator. “The other countries involved really can’t negotiate,” he said. “The only option is to retaliate.” As of midnight in DC, the Trump administration began imposing tariffs on as much as 25% on $34B in Chinese imports. In response, China implemented retaliatory tariffs on some imports from the US, said its foreign ministry. The Trump administration initiated the dispute in Apr, announcing the tariffs & accusing China of using “unfair” tactics to build a large trade surplus with the US & expropriating American technology. The White House has also pressed Congress to tighten rules on Chinese investment in US technology. “These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs,” Trump said. Despite the urging of business groups & lawmakers to negotiate a truce, there is little that the 2 sides would reach a compromise anytime soon. Beijing & DC had held several rounds of high-level talks since early May, but the Trump administration has said it is considering expanding the list of targeted Chinese imports. Trump has threatened additional 10% tariffs on another $200B in Chinese goods if Beijing proceeds with its own retaliatory tariffs. When China retaliates, higher tariffs will hit American exports from cars to soybeans. That would bring the trade war home to states that rely on agriculture & manufacturing, many of which supported Trump in the presidential election. American soybean farmers send about 60% of their crop to China. So far, the tariffs represent a relatively small portion of US-China trade. That means the immediate economic impact of the trade war could be limited for both sides, another reason some analysts expect the dispute to linger for some time.
Oil prices were mixed, with
short-covering pushing up US crude futures while Brent slipped on
global trade tensions & increased Saudi production. West Texas Intermediate crude futures ended the session up 86¢ (1.2%) to $73.80 a barrel but global benchmark Brent was down 23¢ at $77.16 a barrel. For the week, WTI posted a loss of about a ½ a %, while Brent decline about 3%. US crude futures slipped on yesterday after data showed an unexpected 1.3M-barrel build in crude inventories. In addition to reducing
the price of its Aug barrels, Saudi Arabia also told OPEC that it increased
production by almost 500K barrels per day last month. Output cuts by OPEC & allies since Jan 2017 have reduced a crude glut. Involuntary drops in
supply in Venezuela, Angola & Libya have made the cutbacks even
bigger, although OPEC, led by Saudi Arabia, has since agreed to a
modest increase in output. An imminent shift in global oil trade flows was also affecting prices. Meanwhile, the market continued to watch rising US crude output. This
week's oil drilling rig count, an indicator of future production, rose
by 5 rigs to a total of 863.
US crude rises 1.2 percent, settling at $73.80, but posts weekly loss
Pres Trump wants to establish a post-Brexit bilateral trade deal with the UK "as soon as possible," the US ambassador to the UK said. The Trump administration has committees "from every department" dedicated to figuring out how to put together a US-UK trade deal "really rapidly and efficiently" following Britain's exit from the EU, Ambassador Robert "Woody" Johnson said. "He would love to do a bilateral trade deal, and he is really ready to step up on that the minute we get the go ahead to do it. He will get it done fast because I know it is a major priority for him," Johnson added. The commitment to a bilateral deal followed remarks about Trump's upcoming trip to the UK, where the pres is scheduled to meet with both Prime Minister Theresa May & the Queen. The mission of the trip is to "strengthen the special relationship" between the 2 nations "through shared security and prosperity,” Johnson said. The visit with one of the US's oldest & strongest allies will be bookended by 2 other European summits scheduled in Jul. The UK trip will directly follow Trump's summit with members of NATO. And after spending the weekend in Scotland, Trump will head to Helsinki to meet with Russian Pres Putin on Jul 16. Johnson said Trump was impartial toward the type of Brexit that Britain ends up enacting, whether the clean-break departure from the EU known as a "hard Brexit," or the "soft" version that would preserve some ties between Britain & the EU. "Whether it’s hard or soft, we know great Britain is going to do very well," Johsnon said.
Trump wants a bilateral UK trade deal 'as soon as possible,' US ambassador says
German factory production surged in May, further allaying fears that Europe's largest economy might be cooling. The
German Federal Statistical Office reported that industrial
production rose 2.6% in May over Apr in its strongest monthly
performance since last Nov. Increases were driven by strong rises
in both consumer goods & investment goods sectors. The
report comes after the office said yesterday that industrial orders also
rose 2.6% in May, in figured adjusted for seasonal & calendar
effects, which portends well for future production growth.
German factory production surges 2.6 percent in May
The jobs report was good enough to bring out the bulls today. The data looks good & traders are hoping that a strong US economy will be able to handle problems with trade negotiations. But trade problems are not going away anytime soon & have the potential to be a major drag on economies across the globe. The Dow continues to hold above 24K, although the longer term chart below does not looks encouraging, especially for the balance of the year..
Dow Jones Industrials
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