Dow jumped up 269, advancers over decliners about 2-1 & NAZ gained 101. The MLP index was fractionally lower in the 224s (still very depressed) & the REIT index rose 2 to 399. Junk bond funds continued higher & Treasuries pulled back on profit taking. Oil slid back to the 53s & gold was steady at 1537 after China steered down trade tensions.
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 praised Chinese Pres Xi Jinping & said trade talks will restart after a report indicated that China was willing to return to the negotiating table. “Great respect for the fact that President Xi & his Representatives want ‘calm resolution,’” Trump tweeted. “So impressed that they are willing to come out & state the facts so accurately. This is why he is a great leader & representing a great country. Talks are continuing!” China's Vice Premier Liu He, Xi’s top economic adviser who is leading the nation's trade delegation, said that rising tensions in the trade war are not beneficial to China. “We are willing to resolve the issue through consultations and cooperation in a calm attitude and resolutely oppose the escalation of the trade war,” Liu said. “We believe that the escalation of the trade war is not beneficial for China, the United States, nor to the interests of the people of the world,” he added. During a press conference with German Chancellor Angela Merkel at the G-7 summit in France today, Trump said the US is at a much better position at the current time to make a deal with China. The comments from Liu & Trump come after tensions in the trade dispute rose last week, as both countries announced retaliatory tariffs on each other's exports. China placed tariffs on $75B worth of US goods on Fri, & in response, Trump announced that the tariffs on the remaining $300B of goods from China – set to go into effect on Sep 1 at a 10% rate – would now be taxed at 15%. He also noted that the levies on $250B of Chinese goods, currently at a 25% rate, will increase to 30% beginning Oct 1.
Pres Trump said at the G-7 summit that China is sincere about wanting to make a trade deal with the US. Trump, speaking alongside French Pres Macron at a joint press conference, said he thinks Beijing wants to make a deal “very badly.” “I’m not sure they have a choice” but to deal with the US, whether they want to or not, he added. “I don’t say that as a threat.” Earlier, Trump said US trade officials received overnight calls from the Chinese saying Beijing was ready to return to the negotiating table. “China called last night our top trade people and said. ‘Let’s get back to the table,’ so we will be getting back to the table and I think they want to do something. They have been hurt very badly but they understand this is the right thing to do and I have great respect for it. This is a very positive development for the world,” Trump said. “I think we are going to have a deal,” he added. In Beijing, Foreign Ministry spokesman Geng Shuang said he was not aware that a phone call between the 2 sides had taken place. And Hu Xijin, editor-in-chief of Chinese state-run newspaper the Global Times, denied that negotiators had held the phone calls Trump described. “China didn’t change its position. China won’t cave to U.S. pressure,” said Hu, who is widely seen as a mouthpiece for Beijing's messaging. Asked at the G-7 about reports that China denied the calls took place, Trump snapped: “The Chinese are not saying that!” Trump reiterated that the US had “numerous calls” at the highest levels with the Chinese but would not elaborate on the details of the calls. The trade war between the two economic superpowers had escalated sharply on Fri as both sides slapped more tariffs on each other’s exports.
Trump says he believes China sincerely wants trade deal: ‘I’m not sure they have a choice’
Dems are considering the possibility of passing a short-term funding bill to keep the gov running after Sep 30. House Majority Leader Steny Hoyer floated the possibility of approving a continuing resolution to fund the gov thru at least Nov 22, a source said. But lawmakers could also choose to pass a measure to avoid a shutdown thru Dec 6, another source said. Earlier this month, the White House reached a deal with Dems to raise the debt ceiling & increase top-line spending numbers. Lawmakers still have to pass appropriations bills before current funding runs out at the end of Sep. But the administration also warned that Trump would not sign another “omnibus” spending package that combines all 12 appropriations bills as he did in 2018 over the protests of his conservative base . A senior administration official said that the White House would rather pass the bills in smaller chunks, with the controversial fight over funding for the Defense & Homeland Security depts coming up first. In the last round of spending negotiations, Homeland Security went last, resulting in a bitter fight over the Trump's border wall that led to the longest gov shutdown in history. However, House Dems have not committed to taking up the appropriations bills in any specific order, according to an aide. The source said Dems are discussing combining 3 or 4 spending bills into one package, as per the pre's request. But they want to keep all of those packages moving on the same timetable with the hope of completing all of the work by early Dec. Lawmakers will not return from their Aug recess until Sep 9, giving them only a few weeks to reach a deal on funding the gov. The Senate was waiting to pass funding measures until Trump signed the budget deal into law. He did so earlier this month. When it passed the $2.7T-budget deal, Congress also removed spending caps that would have triggered across-the-board cuts next year.
Democrats float a short-term funding bill to avoid another government shutdown
Given the high volatility this month, today was relatively calm. The Dow had a decent gain on hopes that trade talks with China are moving forward. But the status of trade talks is confusing when multiple leakers give confusing information. However, it is clear these talks need a lot more work. This semi-vacation week is shaping up as another choppy time for stocks.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
French & US officials have reached a compromise on a controversial French digital tax at the G-7 summit in France, a senior Trump administration official confirmed. French
Finance Minister Bruno Le Maire, Treasury Secretary Steve
Mnuchin, & White House economic adviser Larry Kudlow negotiated
the détente, with France refunding US companies the difference between
the tax & a planned mechanism being drawn up by the Organization for
Economic Co-operation & Development (OECD). France's 3% levy would
apply to revenue from digital services earned by firms with more than
€25M ($27.86M) in French revenue & €750M ($830M) worldwide. During a G-7
summit press conference, French Pres Emmanuel Macron said the
digital services tax compromise was positive & not aimed at any
country in particular. The levy, which provoked Pres Trump to
threaten a retaliatory tax on French wine imports, has rippled thru
the digital community. The precedent-setting
tax has been castigated by Trump, & the Trade Representative's
Office described it as “unreasonable.” The office opened a public
comment period on new French tariffs & other trade restrictions, which
closed today, as the compromise was reached. Several EU countries
like Austria, Spain & Italy, as well as Britain. have proposed
potential digital taxes. Tech giants testified at a recent congressional hearing that American companies would be disproportionately affected.
France, US reach digital tax compromise
Pres Trump praised Chinese Pres Xi Jinping & said trade talks will restart after a report indicated that China was willing to return to the negotiating table. “Great respect for the fact that President Xi & his Representatives want ‘calm resolution,’” Trump tweeted. “So impressed that they are willing to come out & state the facts so accurately. This is why he is a great leader & representing a great country. Talks are continuing!” China's Vice Premier Liu He, Xi’s top economic adviser who is leading the nation's trade delegation, said that rising tensions in the trade war are not beneficial to China. “We are willing to resolve the issue through consultations and cooperation in a calm attitude and resolutely oppose the escalation of the trade war,” Liu said. “We believe that the escalation of the trade war is not beneficial for China, the United States, nor to the interests of the people of the world,” he added. During a press conference with German Chancellor Angela Merkel at the G-7 summit in France today, Trump said the US is at a much better position at the current time to make a deal with China. The comments from Liu & Trump come after tensions in the trade dispute rose last week, as both countries announced retaliatory tariffs on each other's exports. China placed tariffs on $75B worth of US goods on Fri, & in response, Trump announced that the tariffs on the remaining $300B of goods from China – set to go into effect on Sep 1 at a 10% rate – would now be taxed at 15%. He also noted that the levies on $250B of Chinese goods, currently at a 25% rate, will increase to 30% beginning Oct 1.
US-China trade war: Trump praises Xi, as Beijing calls for 'calm' resolution
Pres Trump said at the G-7 summit that China is sincere about wanting to make a trade deal with the US. Trump, speaking alongside French Pres Macron at a joint press conference, said he thinks Beijing wants to make a deal “very badly.” “I’m not sure they have a choice” but to deal with the US, whether they want to or not, he added. “I don’t say that as a threat.” Earlier, Trump said US trade officials received overnight calls from the Chinese saying Beijing was ready to return to the negotiating table. “China called last night our top trade people and said. ‘Let’s get back to the table,’ so we will be getting back to the table and I think they want to do something. They have been hurt very badly but they understand this is the right thing to do and I have great respect for it. This is a very positive development for the world,” Trump said. “I think we are going to have a deal,” he added. In Beijing, Foreign Ministry spokesman Geng Shuang said he was not aware that a phone call between the 2 sides had taken place. And Hu Xijin, editor-in-chief of Chinese state-run newspaper the Global Times, denied that negotiators had held the phone calls Trump described. “China didn’t change its position. China won’t cave to U.S. pressure,” said Hu, who is widely seen as a mouthpiece for Beijing's messaging. Asked at the G-7 about reports that China denied the calls took place, Trump snapped: “The Chinese are not saying that!” Trump reiterated that the US had “numerous calls” at the highest levels with the Chinese but would not elaborate on the details of the calls. The trade war between the two economic superpowers had escalated sharply on Fri as both sides slapped more tariffs on each other’s exports.
Trump says he believes China sincerely wants trade deal: ‘I’m not sure they have a choice’
Dems are considering the possibility of passing a short-term funding bill to keep the gov running after Sep 30. House Majority Leader Steny Hoyer floated the possibility of approving a continuing resolution to fund the gov thru at least Nov 22, a source said. But lawmakers could also choose to pass a measure to avoid a shutdown thru Dec 6, another source said. Earlier this month, the White House reached a deal with Dems to raise the debt ceiling & increase top-line spending numbers. Lawmakers still have to pass appropriations bills before current funding runs out at the end of Sep. But the administration also warned that Trump would not sign another “omnibus” spending package that combines all 12 appropriations bills as he did in 2018 over the protests of his conservative base . A senior administration official said that the White House would rather pass the bills in smaller chunks, with the controversial fight over funding for the Defense & Homeland Security depts coming up first. In the last round of spending negotiations, Homeland Security went last, resulting in a bitter fight over the Trump's border wall that led to the longest gov shutdown in history. However, House Dems have not committed to taking up the appropriations bills in any specific order, according to an aide. The source said Dems are discussing combining 3 or 4 spending bills into one package, as per the pre's request. But they want to keep all of those packages moving on the same timetable with the hope of completing all of the work by early Dec. Lawmakers will not return from their Aug recess until Sep 9, giving them only a few weeks to reach a deal on funding the gov. The Senate was waiting to pass funding measures until Trump signed the budget deal into law. He did so earlier this month. When it passed the $2.7T-budget deal, Congress also removed spending caps that would have triggered across-the-board cuts next year.
Democrats float a short-term funding bill to avoid another government shutdown
Given the high volatility this month, today was relatively calm. The Dow had a decent gain on hopes that trade talks with China are moving forward. But the status of trade talks is confusing when multiple leakers give confusing information. However, it is clear these talks need a lot more work. This semi-vacation week is shaping up as another choppy time for stocks.
Dow Jones Industrials
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