Dow gave back 70, decliners over advancers 2-1 & NAZ was off 11. The MLP index was off a tad in the 284s & the REIT index dropped 1 to the 357s. Junk bond funds fluctuated & Treasuries were steady. Oil fell 1+ to the 67s & gold was of slightly at a depressed 1216.
AMJ (Alerian MLP Index tracking fund)
Stocks cautiously lower amid latest tariff spat
Pres Trump predicted that US economic growth may top 5% in the next qtr. Trump, who gave the remarks at a dinner with business leaders, said he thinks an increase in GDP during Q3 “could be in the fives.” “We anticipate this next quarter to be, this is just an estimate, but already they’re saying it could be in the fives,” Trump said. GDP growth hit an annual rate of 4.1% in Q2, the fastest pace since 2014.
club.ino.com/trend/analysis/stock/DIS?a_aid=CD3289&a_bid=6ae5b6f7
Germany is to increase its powers to block foreign investments by significantly lowering the threshold for deals that can be subject to ministerial veto, in a further sign of growing protectionist sentiment towards Chinese acquisitions. Berlin can veto deals that involve the purchase of at least 25% of the equity of a German company by an entity from outside the EU, & only if they endanger public order or national security. Ministers now want to reduce that threshold to 15%. Peter Altmaier, economics minister, said that the threshold would be lowered "so that we can check more acquisitions in sensitive sectors of the economy." The new bill could come into force this year. "We want to be able to take a much closer look at companies in the defense sector and in critical infrastructures, and certain other civilian technologies that are relevant to security, such as IT-security," Mr. Altmaier said. Germany is increasingly intervening to stop Chinese investments, particularly in companies operating in critical infrastructure, amid fears that some of its most advanced technology is ending up in Chinese hands. Last month, the gov directed state development bank KfW to take a 20% stake in 50Hertz, a high-voltage power network operator, to pre-empt the stake's acquisition by a Chinese state investor. Last week a Chinese company, Yantai Taihai, withdrew its bid for Leifeld Metal Spinning, a small German machine tool manufacturer that specializes in materials for the aerospace & nuclear industries, after the gov moved to block the deal. It would have been the first use of Germany's foreign investment law to veto a mergers & acquisitions transaction. Germany's tougher stance is part of a global backlash against Chinese takeovers. Pres Trump is expected to sign into law measures to expand the powers of the Committee on Foreign Investment in the US (Cfius), an inter-agency panel that reviews foreign investments for national security threats. Meanwhile the UK recently unveiled a 120-page policy to enhance gov powers to prevent foreign purchases of security-sensitive British assets.
Germany wants to tighten rules on foreign investments in an attempt to curb Chinese acquisitions
Trade wars are getting more attention, even in Europe. That's not good for the stock market which has been rising for more than a month. The Dow is still about 1K below its Jan record but will need have a tough time adding to those gains if trade wars are not resolved quickly.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 67.68 | -1.49 | -2.2% |
| GC=F | Gold | 1,217.30 | -1.00 | -0.1% |
Stocks were slightly lower after the Chinese gov announced another round of retaliatory tariffs. China
will match the US & apply a 25% tariff on $16B worth of
imported US goods including crude oil, cars, coal, diesel, medical
equipment & steel products. In total, the tariffs will be applied on
333 products & will be implemented on Aug 23, the same day similar
US tariffs on Chinese goods will take effect. Yesterday, US stocks ended higher even as the first round of economic
sanctions were put back on Iran. The Dow
climbed 126 (0.5%) to 25,628 & the S&P 500 rose 8 to 2858. The NAZ gained 23, closing at
7883.66. Tesla (TSLA) resumed trading on NAZ exchange after a nearly 2-hour
pause on yesterday, shortly after the company confirmed in a
blog post that CEO Elon Musk is considering taking the electric car
maker private at $420 per share. The stock spiked on the initial news,
with shares rising more than 10% as trading resumed but were lower today.
Stocks cautiously lower amid latest tariff spat
The trade war between the US & China continues
to escalate, with China slapping a 25% tariff on another $16B
worth of US goods. The latest charge comes
after the US said it would implement another round of tariffs on $16B worth of Chinese goods. China's
Commerce Ministry called the US decision to place the latest round of
tariffs on Chinese goods “unreasonable” & said it decided to take
counter measures, matching the tariffs in percentage & value. China
said it is targeting 333 products, including crude oil, coal, diesel,
cars, bicycles, medical equipment, steel products, scrap metals &
waste paper, as well as fish meal. In
Jul, the US & China exchanged tariffs on $34B worth of
goods. DC applied a 25% tariff on Chinese imports including
airplane tires & various industrial parts while China placed tariffs on
US imports including pork & soybeans.
China places tariffs on another $16B worth of US goods
Pres Trump predicted that US economic growth may top 5% in the next qtr. Trump, who gave the remarks at a dinner with business leaders, said he thinks an increase in GDP during Q3 “could be in the fives.” “We anticipate this next quarter to be, this is just an estimate, but already they’re saying it could be in the fives,” Trump said. GDP growth hit an annual rate of 4.1% in Q2, the fastest pace since 2014.
Trump: GDP growth 'could be in the 5s' next quarter
Walt Disney (DIS), a Dow stock, reported earnings & revenue that missed estimates amid higher costs & mixed results in its media networks business. The
cable networks, particularly ESPN, have come under pressure in recent
qtrs as more consumers opt for cheaper pay-TV packages & video
streaming services. DIS launched ESPN+, a
$4.99-a-month streaming service, in Apr to attract viewers looking for
cheaper alternatives. The media networks
business, the largest by revenue, posted a 1% decline in
operating income despite stronger revenue. An increase in operating
income at ESPN was offset by a loss at BAMTech and weaker results for
cable network Freeform. The
company also reported a decline in operating income for its consumer
products & interactive media business. The theme parks and
resorts recorded stronger results, while the studio entertainment
division saw higher operating income on 20% revenue growth. Adjusted EPS was $1.87 compared to the estimate of
$1.95 revenue grew 7% to $15.23B. Analysts were looking for $15.34B in revenue. Expenses rose $97M to $196M due to costs related to its agreement to purchase certain assets from 21st Century Fox (FOXA). The
company also cited higher compensation costs. DIS stock fell 2.23.
If you would like to learn more about DIS, click on this link:club.ino.com/trend/analysis/stock/DIS?a_aid=CD3289&a_bid=6ae5b6f7
Disney earnings miss as higher costs weigh on bottom line
Germany is to increase its powers to block foreign investments by significantly lowering the threshold for deals that can be subject to ministerial veto, in a further sign of growing protectionist sentiment towards Chinese acquisitions. Berlin can veto deals that involve the purchase of at least 25% of the equity of a German company by an entity from outside the EU, & only if they endanger public order or national security. Ministers now want to reduce that threshold to 15%. Peter Altmaier, economics minister, said that the threshold would be lowered "so that we can check more acquisitions in sensitive sectors of the economy." The new bill could come into force this year. "We want to be able to take a much closer look at companies in the defense sector and in critical infrastructures, and certain other civilian technologies that are relevant to security, such as IT-security," Mr. Altmaier said. Germany is increasingly intervening to stop Chinese investments, particularly in companies operating in critical infrastructure, amid fears that some of its most advanced technology is ending up in Chinese hands. Last month, the gov directed state development bank KfW to take a 20% stake in 50Hertz, a high-voltage power network operator, to pre-empt the stake's acquisition by a Chinese state investor. Last week a Chinese company, Yantai Taihai, withdrew its bid for Leifeld Metal Spinning, a small German machine tool manufacturer that specializes in materials for the aerospace & nuclear industries, after the gov moved to block the deal. It would have been the first use of Germany's foreign investment law to veto a mergers & acquisitions transaction. Germany's tougher stance is part of a global backlash against Chinese takeovers. Pres Trump is expected to sign into law measures to expand the powers of the Committee on Foreign Investment in the US (Cfius), an inter-agency panel that reviews foreign investments for national security threats. Meanwhile the UK recently unveiled a 120-page policy to enhance gov powers to prevent foreign purchases of security-sensitive British assets.
Germany wants to tighten rules on foreign investments in an attempt to curb Chinese acquisitions
Trade wars are getting more attention, even in Europe. That's not good for the stock market which has been rising for more than a month. The Dow is still about 1K below its Jan record but will need have a tough time adding to those gains if trade wars are not resolved quickly.
Dow Jones Industrials
No comments:
Post a Comment