Dow jumped up 155, advancers over decliners better than 2-1 & NAZ shot up 110. The MLP index crawled higher in the 246s. Junk bond funds were mixed & Treasuries declined in price. Oil fell pennies in the 53s & gold sank 12 to 1333 as stocks were purchased.
AMJ (Alerian MLP Index tracking fund)
China's imports fell the most in nearly 3 years, another sign of weakening domestic demand that may prompt China to increase stimulus measures. May imports were much weaker than expected, falling 8.5%, leaving the country with a trade surplus of $41.6B. The forecast was for imports falling 3.8%, reversing an expansion of 4% in Apr, which some had suspected was related to the reduction in the VAT. Despite higher US tariffs. China's exports unexpectedly returned to growth in May. It had been suspected that in order to avoid the new tariffs, exporters may have rushed out shipments to the US. This was prompted as Pres Trump was threatening to impose new tariffs on $300B worth of goods. China's May exports rose 1.1% from a year earlier, compared with market expectations for a modest decline, customs data showed. The expectation was for exports to fall 3.8% from a year earlier, after a contraction of 2.7% in Apr. On May 10, the US slapped higher tariffs of up to 25% on $200B of Chinese goods. It was followed by steps to add duties on all remaining $300B Chinese imports. Beijing retaliated with tariff hikes on US goods. Trump has said he expects to hold a meeting with Chinese Pres Xi Jinping at a G20 summit later this month. China's trade surplus with the US widened to a 4-month high of $26.9B in May, from $21.0B in Apr.
China imports slump most in nearly 3 years
Trump budget official pushes for delay in Huawei ban
News on the trade front brought out stock buyers. Now Mexico has to deliver on its promises. China might be more receptive to reach a deal with the US, especially after it has to deal with slower growth in its economy led by sluggish import data. The Dow is up an impressive 1.3K in Jun following a tough time in May. Extending this rally with require the bulls to keep buying stocks.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 53.74 | -0.25 | -0.5% |
| GC=F | Gold | 1,333.10 | -13.00 | -1.0% |
Stocks opened higher to begin the week. Stocks around the world got a boost as Pres Trump backed
away from his plan to slap a 5% tariff on Mexican goods late
on Fri night after the nation agreed to enforce a tougher stance on
immigration & purchase more agricultural goods from the US. China's imports fell the most in nearly 3
years, another sign of weakening domestic demand that may prompt China
to increase stimulus measures. May imports were
much weaker than expected, falling 8.5%, the sharpest drop in 3 years. That left the country with a trade surplus of $41.6B
for the month. The forecast called for imports falling 3.8%. Chinese markets closed higher to start the week
with the Shanghai Composite added 0.9%. Hong Kong's Hang Seng
rose 2.3% & Japan's Nikkei ended the day rising 1.2% to a
2-week high. In Eurpean markets, Britain's FTSE
100 was up 0.6%, France's CAC 40 climbed 0.3% & German
markets were closed for a holiday.
US stocks jump as Trump delays Mexico tariffs
China's imports fell the most in nearly 3 years, another sign of weakening domestic demand that may prompt China to increase stimulus measures. May imports were much weaker than expected, falling 8.5%, leaving the country with a trade surplus of $41.6B. The forecast was for imports falling 3.8%, reversing an expansion of 4% in Apr, which some had suspected was related to the reduction in the VAT. Despite higher US tariffs. China's exports unexpectedly returned to growth in May. It had been suspected that in order to avoid the new tariffs, exporters may have rushed out shipments to the US. This was prompted as Pres Trump was threatening to impose new tariffs on $300B worth of goods. China's May exports rose 1.1% from a year earlier, compared with market expectations for a modest decline, customs data showed. The expectation was for exports to fall 3.8% from a year earlier, after a contraction of 2.7% in Apr. On May 10, the US slapped higher tariffs of up to 25% on $200B of Chinese goods. It was followed by steps to add duties on all remaining $300B Chinese imports. Beijing retaliated with tariff hikes on US goods. Trump has said he expects to hold a meeting with Chinese Pres Xi Jinping at a G20 summit later this month. China's trade surplus with the US widened to a 4-month high of $26.9B in May, from $21.0B in Apr.
China imports slump most in nearly 3 years
The Trump administration's top budget official is pushing the White House & Congress to delay a ban on federal agencies buying products from Huawei Tech amid concerns that a large number of US businesses would no longer be able to do work with the gov. Defense
policy legislation signed into law last year restricted the US
gov & those who receive federal grants from doing business,
either directly or through contractors, with Huawei. The
measure, however, would also disproportionately affect rural companies & federal grantees, according to Russell Vought, acting director of
the Office of Management & Budget (OMB). “The
Administration believes, based on feedback from impacted stakeholders,
that this additional preparatory work will better ensure the effective
implementation of the prohibition without compromising desired security
objectives,” he wrote in a Jun 4 letter to VP Mike Pence & several members of Congress. The OMB is requesting the ban on those who receive
federal loans & grants to take effect in 4 years, a 2-year delay
from the current timeline. The request comes
as the White House takes a more aggressive stance on curbing the US
operations of the Chinese telecommunications firm. Last
month, Trump signed an executive order to bar American businesses from
working with firms deemed a national security threat, a sweeping action
that was company & country-agnostic but widely acknowledged to be
directed at Huawei.
Trump budget official pushes for delay in Huawei ban
Treasury Secretary Steve Mnuchin said that
he sees “no signs” of the US economy heading into a recession as he
defended Pres Trump for threatening Mexico with tariffs to solve
national security issues. Mnuchin said that the US economy is “still the bright spot of the world” despite the May jobs report released Fri showing the US added a less-than-expected 75K jobs last month. “As
it relates to the employment numbers, I wouldn’t focus on any one
number: There’s plenty of volatility in these numbers,” Mnuchin added. “We still see the growth in the U.S. as really quite strong.” Mnuchin said US officials are more concerned about “what we see as a slowdown in Europe, China and other areas of the world.” “I don’t see any signs of a recession. I would say
the bond markets are predicting ... a lowering of interest rates. We
are in an environment where global interest rates are very low around
the world, so I think that’s what you’re seeing in the U.S. bond
markets,” he said. “But, no, we see no signs of a recession. We see another strong quarter in the United States,” Mnuchin reiterated. He also defended Trump for using tools such as tariffs to solve
national security issues, saying Trump did a “great job” using the tools
toward the country's advantage. Last week, Trump threatened to impose a
5% tariff on Mexican goods if the country did not stop the flow
of illegal immigrants & drugs across the border. The pres
announced the US reached an agreement with Mexico on Fri. “I
think it’s very important that we have all these tools, that we use
them. And President Trump has really done a great job at using these
tools,” Mnuchin said. Mnuchin
said he “couldn’t be more pleased” that the US & Mexico had reached
an agreement before Trump's proposed tariffs were implemented. “The immigration issue was a very serious issue, we couldn’t be more
pleased that Mexico came to the table and negotiated an agreement, and
because of that we don’t need to put tariffs on them,” he added. “I have
every reason to believe they [Mexico] will meet their commitments. But
if for whatever reason they don’t, the president reserves the right to
put on tariffs.”
News on the trade front brought out stock buyers. Now Mexico has to deliver on its promises. China might be more receptive to reach a deal with the US, especially after it has to deal with slower growth in its economy led by sluggish import data. The Dow is up an impressive 1.3K in Jun following a tough time in May. Extending this rally with require the bulls to keep buying stocks.
Dow Jones Industrials
No comments:
Post a Comment