Dow rose 19, advancers over decliners 3-2 & NAZ went up13. The MLP index slid lower in the 205s & the REIT index gained 3+ to 404. Junk bond funds did little & Treasuries were purchased. Oil climbed higher in the 58s & gold added 1 o 1457.
AMJ (Alerian MLP Index tracking fund)
Top Chinese & US trade negotiators have agreed to talks on a preliminary deal for resolving the tariff war between the 2 large economies, the Chinese Commerce Ministry said. In a brief notice, the ministry said that Vice Premier Liu He & other senior officials spoke by phone with Trade Representative Robert Lighthizer & Treasury Secretary Steve Mnuchin. The official Xinhua News Agency said the 2 sides discussed “solving issues regarding each other’s core concerns, reached consensus on properly resolving related issues & agreed to maintain communication on remaining issues in consultations on the Phase 1 deal.” The announcement was not immediately confirmed by the US side. It came after shares struck new record highs yesterday following Beijing's announcement of new guidelines for the protection of patents & copyrights. Theft of such intellectual property has been a sore point in the trade war between the economies & investors saw China's move as an encouraging sign. However, the news of the phone call drew only a tepid reaction in Asia. Financial markets have been buffeted by conflicting signals for months, with upbeat comments followed by escalations in tensions. The Shanghai Composite index was flat while the Hang Seng in Hong Kong also was almost unchanged by today's news, which did not say a deal was imminent. The inclusion of China’ Commerce Minister Zhong Shan, the Governor of the People's Bank of China Yi Gang, & Vice Chairman of the National Development & Reform Commission Ning Jizhe does indicate high level involvement at this point of the discussions. The Communist Party newspaper Global Times ran a front page article citing experts dismissing “negative media reports” about the talks. It cited a scholar at the Chinese Academy of Social Sciences, Gao Lingyun, who it said was “close to the trade talks” & said the 2 sides may reach a “Phase 1” agreement soon. Gao said Beijing & DC had agreed that tariffs would be rolled back as part of such a deal, but had not agreed yet on which tariffs might be removed or lowered. Pres Trump imposed tariffs on Bs of $s worth of Chinese exports beginning in mid-2018. He said such moves were needed to win true concessions on longstanding issues such as complaints by foreign companies that Chinese companies steal or force the sharing of advanced technologies. His administration also wants China to scale back a national industrial strategy aimed at making Chinese industries leaders in new technologies such as robotics. The 2 sides since have imposed punitive tariffs on thousands of each other's products comprising a large share of trade. Trump has also ordered curbs on sharing of some technology with some Chinese companies.
US home prices increased modestly in Sep from a year ago, as roughly 7 years of rising home values have hurt affordability. The S&P CoreLogic Case-Shiller 20-city home price index rose 2.1% in Sep from a year ago, up from a 2% annual gain in Aug. “For many buyers, the fall housing market provides several challenges and opportunities,” said George Ratiu, senior economist at realtor.com. “While lower financing costs and a rising number of new homes are welcome signs in a market parched for inventory, prices are still climbing and the number of existing houses in the affordable price range is down by double-digits.” Prices have so steadily outpaced wage growth for several years that the market is now constrained by buyers’ capacity to pay. Home values have tumbled 0.7% in San Francisco & increased just 0.8% in NY & 1.7% in Seattle. Still, there are signs that low mortgage rates are boosting demand & prices could increase at faster pace in the months ahead as there is a shortage of listings.
US consumer confidence falls for fourth consecutive month
Stocks have modest gains as investors weigh the ups & downs of US-China trade negotiations. Without major news announcements his holiday week, market moves should be limited.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 58.47 | +0.46 | +0.8% |
| GC=F | Gold | 1,456.20 | -0.70 | -0.1% |
Top Chinese & US trade negotiators have agreed to talks on a preliminary deal for resolving the tariff war between the 2 large economies, the Chinese Commerce Ministry said. In a brief notice, the ministry said that Vice Premier Liu He & other senior officials spoke by phone with Trade Representative Robert Lighthizer & Treasury Secretary Steve Mnuchin. The official Xinhua News Agency said the 2 sides discussed “solving issues regarding each other’s core concerns, reached consensus on properly resolving related issues & agreed to maintain communication on remaining issues in consultations on the Phase 1 deal.” The announcement was not immediately confirmed by the US side. It came after shares struck new record highs yesterday following Beijing's announcement of new guidelines for the protection of patents & copyrights. Theft of such intellectual property has been a sore point in the trade war between the economies & investors saw China's move as an encouraging sign. However, the news of the phone call drew only a tepid reaction in Asia. Financial markets have been buffeted by conflicting signals for months, with upbeat comments followed by escalations in tensions. The Shanghai Composite index was flat while the Hang Seng in Hong Kong also was almost unchanged by today's news, which did not say a deal was imminent. The inclusion of China’ Commerce Minister Zhong Shan, the Governor of the People's Bank of China Yi Gang, & Vice Chairman of the National Development & Reform Commission Ning Jizhe does indicate high level involvement at this point of the discussions. The Communist Party newspaper Global Times ran a front page article citing experts dismissing “negative media reports” about the talks. It cited a scholar at the Chinese Academy of Social Sciences, Gao Lingyun, who it said was “close to the trade talks” & said the 2 sides may reach a “Phase 1” agreement soon. Gao said Beijing & DC had agreed that tariffs would be rolled back as part of such a deal, but had not agreed yet on which tariffs might be removed or lowered. Pres Trump imposed tariffs on Bs of $s worth of Chinese exports beginning in mid-2018. He said such moves were needed to win true concessions on longstanding issues such as complaints by foreign companies that Chinese companies steal or force the sharing of advanced technologies. His administration also wants China to scale back a national industrial strategy aimed at making Chinese industries leaders in new technologies such as robotics. The 2 sides since have imposed punitive tariffs on thousands of each other's products comprising a large share of trade. Trump has also ordered curbs on sharing of some technology with some Chinese companies.
China's top negotiators say US talks going strong, Phase 1 soon
US home prices increased modestly in Sep from a year ago, as roughly 7 years of rising home values have hurt affordability. The S&P CoreLogic Case-Shiller 20-city home price index rose 2.1% in Sep from a year ago, up from a 2% annual gain in Aug. “For many buyers, the fall housing market provides several challenges and opportunities,” said George Ratiu, senior economist at realtor.com. “While lower financing costs and a rising number of new homes are welcome signs in a market parched for inventory, prices are still climbing and the number of existing houses in the affordable price range is down by double-digits.” Prices have so steadily outpaced wage growth for several years that the market is now constrained by buyers’ capacity to pay. Home values have tumbled 0.7% in San Francisco & increased just 0.8% in NY & 1.7% in Seattle. Still, there are signs that low mortgage rates are boosting demand & prices could increase at faster pace in the months ahead as there is a shortage of listings.
US home prices rose 2.1% from a year ago, affordable housing stock shrinks
Consumer confidence dipped for a 4th straight
month in Nov as economic conditions weaken toward the end of 2019, according to The Conference Board shows. The Board's
consumer confidence index dipped to 125.5 this month. That’s down from
126.1 in Oct. The forecast called for the index to
rise to 126.6. The
present situation index also fell to 166.9 from 173.5 in Nov. This
“suggests that economic growth in the final quarter of 2019 will remain
weak,” said Lynn Franco, senior director of economic indicators at The
Conference Board. “However, consumers’ short-term
expectations improved modestly, and growth in early 2020 is likely to
remain at around 2%. Overall, confidence levels are still high and
should support solid spending during this holiday season.” The
data release is the latest pointing to weaker economic growth to end
the year. The NY Federal Reserve's Staff Nowcast, which estimates
quarterly GDP growth, points to an expansion of just 0.7% in Q4. The Atlanta Fed's GDPNow measure indicates growth of just 0.4%. But expectations for the holiday shopping season are strong. The
National Retail Federation expects holiday sales to grow by about 4%
from last year.
US consumer confidence falls for fourth consecutive month
Stocks have modest gains as investors weigh the ups & downs of US-China trade negotiations. Without major news announcements his holiday week, market moves should be limited.
Dow Jones Industrials
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