Dow rose 61, advancers over decliners 3-2 & NAZ gained 7. The MLP index rose 3+ to a still depressed 236s & the REIT index was fractionally lower to the 403s. Junk bond funds did little in trading & Treasuries were sold again, bringing higher yields. Oil slid back pennies in the low 55s & gold fell 3 to 1503.
AMJ (Alerian MLP Index tracking fund)
Stocks near record highs as trade tensions thaw
US retail sales rose moderately in Aug, driven higher by a jump in auto buying & healthy online sales. But there were also signs that consumers have become more cautious. The Commerce Dept said retail sales increased 0.4% last month, down from a healthy 0.8% in Jul. Excluding autos, sales were unchanged for the first time since Feb. The modest slowdown follows signs that consumer confidence, while still strong, has slipped a bit as the US-China trade war has intensified. US businesses have cut back on their investment & expansion plans amid the trade war's uncertainty & exports have declined. That has left consumers as a key source of growth. Online sales continued to soar, rising 1.6%, roughly the same amount as in Jul, when Amazon (AMZN) held its Prime Day.
US retail sales rose more than expected in August as auto buying jumped
US consumer sentiment jumps as confidence around the economy rises
Trade relations with China are calming down, at least for the time being. China has to deal with slowing growth, the Hong Kong's status along with US trade, all major headaches. Meanwhile, the Dow needs just 100 to reach a new record.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 54.91 | -0.18 | -0.3% |
| GC=F | Gold | 1,511.20 | +3.80 | +0.3% |
Stocks are closing in on record highs after a further thawing of trade relations between the US & China. State-run Chinese media said today said US soybeans & pork would be exempt from additional tariffs. The report followed comments from Pres Trump, who yesterday said he would consider an interim trade deal. Early gains in the stock indices have all 3 closing in on their record highs set in Jul. The spread between the US 2-year & 10-year Treasury yields was
trading at 9 basis today after turning negative last month
for the first time in over a decade. In Europe, markets were mixed with London's FTSE trailing & Germany's DAX & France's CAC pacing the gains. Overnight, Japan's
Nikkei gained 1.1% to close at a 4-month high. Hong Kong's
Hang Seng & China's Shanghai Composite climbed almost 1% on the day & 2.5% for the week.
Stocks near record highs as trade tensions thaw
Record high pork prices may be behind China's latest trade concession. Chinese state-run news agencies said
that US pork & soybeans will be exempt from
additional tariffs. Soybeans make up a large portion of a pig's diet. “Based
on what I know, Chinese govt encourages Chinese companies to buy
certain amount of US farm products, including soybeans and pork, which
will also be exempted from additional tariffs,” tweeted Hu Xijin, editor
in chief of the state-run Global Times. Fri's announcement may seem like a trade concession from China, but there are other forces also at play. African
swine fever has swept across China, causing a 32.2%
year-over-year drop in the number of live pigs. The report
added that the depleted supply caused pork prices to soar by a record
23% month-over-month in Aug to an all-time high of 36 yuan per
kilogram in early Sep, up 76% this year. China
is the world's largest consumer of pork, accounting for 49% of
global consumption pork makes up 75% of China’s
meat consumption.
China blinks in trade war as pork prices spiral out of control
US retail sales rose moderately in Aug, driven higher by a jump in auto buying & healthy online sales. But there were also signs that consumers have become more cautious. The Commerce Dept said retail sales increased 0.4% last month, down from a healthy 0.8% in Jul. Excluding autos, sales were unchanged for the first time since Feb. The modest slowdown follows signs that consumer confidence, while still strong, has slipped a bit as the US-China trade war has intensified. US businesses have cut back on their investment & expansion plans amid the trade war's uncertainty & exports have declined. That has left consumers as a key source of growth. Online sales continued to soar, rising 1.6%, roughly the same amount as in Jul, when Amazon (AMZN) held its Prime Day.
US retail sales rose more than expected in August as auto buying jumped
Sentiment in the US rose more than expected this
month as consumers felt more confident about current and future
economic conditions, according to preliminary data released by
the Univ of Mich. The Sep reading on consumer
sentiment rose to 92 from 89.8 in Aug. The forecast was for sentiment
to rise to 91. The current economic conditions index also rose to
106.9 from 105.3. However,
while consumers feel more confident about the economy, worries about
the impact of tariffs on the economy increased in early Sep.
Richard Curtin, chief economist for the Surveys of Consumers, said 38%
of all consumers made “spontaneous references to the negative impact of
tariffs, the highest percentage since March 2018.” “Those who
negatively mentioned tariffs also held more negative views on the
overall outlook for the economy as well as anticipated higher inflation
and unemployment in the year ahead,” Curtin added. China & the
US have been embroiled in a trade war since last year with both
countries slapping tariffs on Bs of $s of their goods. However, sentiment around US-China trade relations improved this week after Pres Trump said he is open to reaching an interim deal with the Chinese. China will also reportedly exempt some US agricultural products from tariffs.
US consumer sentiment jumps as confidence around the economy rises
Trade relations with China are calming down, at least for the time being. China has to deal with slowing growth, the Hong Kong's status along with US trade, all major headaches. Meanwhile, the Dow needs just 100 to reach a new record.
Dow Jones Industrials
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