Dow slid back 7, advancers over decliners better than 3-2 & NAZ gained 22. The MLP index was steady in the 239s & the REIT index fluctuated in the 367s. Junk bond funds inched higher & Treasuries were sold. Oil dropped 1 to the 51s & gold gave back 8 to 1310 (more below).
AMJ (Alerian MLP Index tracking fund
Stocks rise as US-China trade talks resume
Trade talks resume between US-China negotiators
Growing economic anxiety hits Main Street as small-business confidence declines: Survey
Gold prices retreated as a leading dollar index hovered near more than one-month highs, cutting demand for investors buying precious metals using other currencies. Riskier markets, including US stocks, headed higher on cautious optimism for the next round of US-China trade negotiations resuming this week, limiting but hardly eliminating the appeal of haven assets, including gold. Apr gold was down $7.80 (0.6%) at $1310 an ounce. It fell 0.3% last week, but has climbed 2.9% since the end of last year based on the most-active contract as uneasy trade progress, grouped with a series of global growth downgrades, sent investors to seek cover in lower-risk pockets of the financial markets. The SPDR Gold Shares ETF (GLD) fell 0.6% today. Investors are looking ahead to trade talks this week with a delegation of US officials traveling to China for the next round. Pres Trump said last week that he had no plans to meet with Chinese Pres Xi Jinping before a Mar 1 deadline to achieve a trade deal. Trump has vowed to increase tariffs on $200B worth of Chinese imports to 25% from 10% if the 2 sides cannot reach a deal. That action is seen aggravating economic growth at a time when a late-cycle recovery is already showing signs of sputtering.
Not too much for stocks to do as trade talks resume, a gov shutdown on Fri looms & more earnings are coming this week. The Dow is holding above 25K & needs only a 7% advance to reach a new record. In these confusing times, safe haven gold & Treasuries dipped lower today.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund
| CL=F | Crude Oil | 51.69 | -1.03 | -2.0% |
| GC=F | Gold | 1,309.70 | -8.80 | -0.7% |
Equities traded higher as investors focused on the resumption of US-China trade talks.
One
topic on the table in this round of talks involves how China treats
American companies' intellectual property. In Asian markets, China's
Shanghai Composite index rose 1.4% as the market returned to
action following the week-long Lunar New Year holiday. Investors were
optimistic about a trade deal as US & China delegations resumed
talks. Hong Kong's Hang Seng index gained 0.7% & Japanese markets were closed for a holiday. In Europe, London's FTSE added 0.6%, Germany's DAX gained 0.8 & France's CAC was higher by 1%.
Stocks rise as US-China trade talks resume
Trade talks between the US & China have resumed & China is reportedly upbeat.
One main topic in this round involves how China treats American companies' intellectual property. An agreement on that issue would go a long way
toward sealing a trade deal that could prevent tariffs from rising on
Chinese imports. The
latest talks will begin with working level discussions from
Mon-Wed before high-level discussions at the end of the week. The American side is led by Deputy Trade Representative Jeffrey Gerrish. US Trade Representative
Robert Lighthizer & Treasury Secretary Steve Mnuchin will join
higher principal-level talks Thurs & Fri. The 2 sides are trying to hammer out a deal ahead of the Mar 1 deadline
when US tariffs on $200B worth of Chinese imports are
scheduled to increase to 25% from 10%. Markets have had drastic reactions to headlines concerning trade. White
House advisor Larry Kudlow said last week, "There is a
pretty sizable distance to go in U.S.-China trade talks." After those
comments, the Dow fell into a downward spiral of around 300
points. It was reported that Trump said he
did not plan to meet with Chinese Pres Xi Jinping before the Mar
1 deadline set by the 2 countries for reaching a trade pact.
Trade talks resume between US-China negotiators
There is no panic on Main Street, but confidence is dropping, according to the latest CNBC/Survey/Monkey Small Business Survey. At a time of growing concerns about a
more fragile US economy — with increased stock market volatility, a
lingering trade war with China & Federal Reserve policy adding layers
of uncertainty — small-business optimism across the country has come
down from a record high. The Small Business Confidence Index declined by 1 point from Q4 level of 59 & it is now 4 points below
its Q3 2018 all-time high of 62. There has been a slight decline in
business owners who describe business conditions as good & who plan to
hire more full-time staff in the next year. A narrow majority of
business owners (53%) expect a recession within the next 12 months, mirroring a growing sense of economic anxiety from investors & among individual Americans. With 2 full years of small-business survey data now recorded by CNBC & SurveyMonkey,
the longer-term picture shows that confidence remains much higher than
it was in 2017. Business owners are becoming more cautious on major
decisions but are not in retreat. The percentage of business owners who
describe conditions as bad, who expect to decrease staff & who
forecast lower revenue all remain at lower levels than they were in the
inaugural survey during Q2-2017. "At this point it's just a downtick in
confidence," said Jon Cohen, chief research officer at SurveyMonkey.
"The consistent gains we saw throughout 2018 have clearly abated, but
we'll have to wait and see what subsequent quarters show. It's too early
to call the declines a trend at this point," he added. In Q2-2017 the percentage
of small-business owners who described conditions as good was 38%, while 51% described conditions as "middling." This
qtr 52% of business owners described conditions as good,
lower than the 58% record in Q3 last year but
still much higher than 2 years ago. 40% of entrepreneurs
describe current conditions as "middling." The percentage of business owners who describe conditions as "bad" or who forecast lower revenues remain in a distinct minority. The survey, conducted from Jan 28–Feb 4, polled more than 2200 small-business owners.
Growing economic anxiety hits Main Street as small-business confidence declines: Survey
Gold prices retreated as a leading dollar index hovered near more than one-month highs, cutting demand for investors buying precious metals using other currencies. Riskier markets, including US stocks, headed higher on cautious optimism for the next round of US-China trade negotiations resuming this week, limiting but hardly eliminating the appeal of haven assets, including gold. Apr gold was down $7.80 (0.6%) at $1310 an ounce. It fell 0.3% last week, but has climbed 2.9% since the end of last year based on the most-active contract as uneasy trade progress, grouped with a series of global growth downgrades, sent investors to seek cover in lower-risk pockets of the financial markets. The SPDR Gold Shares ETF (GLD) fell 0.6% today. Investors are looking ahead to trade talks this week with a delegation of US officials traveling to China for the next round. Pres Trump said last week that he had no plans to meet with Chinese Pres Xi Jinping before a Mar 1 deadline to achieve a trade deal. Trump has vowed to increase tariffs on $200B worth of Chinese imports to 25% from 10% if the 2 sides cannot reach a deal. That action is seen aggravating economic growth at a time when a late-cycle recovery is already showing signs of sputtering.
Gold eases as dollar climbs, with U.S.-China trade talks holding market’s attention
Not too much for stocks to do as trade talks resume, a gov shutdown on Fri looms & more earnings are coming this week. The Dow is holding above 25K & needs only a 7% advance to reach a new record. In these confusing times, safe haven gold & Treasuries dipped lower today.
Dow Jones Industrials
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