Dow fell 30, advancers over decliners 4-3 & NAZ went up 9. The MLP index added 1 to 201 & the REIT index crawled higher to the 405s. Junk bond funds were little changed & Treasuries rose slightly in price. Oil slid back under 59 (more below) & gold inched up 1 to 1466.
AMJ (Alerian MLP Index tracking fund)
A Chinese official says Beijjing wants a prompt settlement of its trade war with DC. A deputy commerce minister said today that Beijing wants “satisfactory results as soon as possible.” The official gave no details of talks on a “Phase 1" deal announced by Pres in Oct. Another US tariff hike on $160B of Chinese imports is due to take effect Sun. China announced Fri it was carrying out a promise to waive punitive tariffs on American soybeans & pork. Trump alarmed global financial markets last week when he said he might be willing to wait until after next year's presidential election to reach a settlement.
Communist Party has ordered all state offices to remove foreign hardware & software within 3 years in a move which could hit major US firms such as Microsoft (MSFT), a Dow stock. The policy has been dubbed “3-5-2” because the replacement of the technology will happen at a pace of 30% in 2020, 50% in 2021 & 20% in 2022. Analysts estimate that 20-30M pieces of foreign equipment need to be replaced in China. China Securities said that the order had come from the Chinese Communist party's Central Office earlier this year. While the directive is not public, 2 cybersecurity firms said that their gov clients described the policy to them. Beijing's move comes against the backdrop of the ongoing US-China trade war in which technology has been front & center. China's technology firms have been the target of US pressure. Earlier this year, Huawei was placed on a US blacklist which stopped American firms doing business with the Chinese telecom networking giant. The US expanded its blacklist in Oct to include a number of Chinese surveillance firms like Hikvision, one of the world's biggest companies for such technology. A provision of a US law known as the National Defense Authorization Act also prohibits executive gov agencies from procuring telecommunications hardware made by Huawei & another Chinese firm, ZTE.
China reportedly orders state offices to remove foreign tech which could hit US firms like Microsoft
Oil futures declined, retreating from their highest settlement since Sep, as signs of economic weakness in China undercut bullishness in the aftermath of last week’s important gathering of global producers. Data out of China showed that global exports were off 1.1% from a year earlier at $221.7B, refreshing concerns about the world's 2nd-largest economy & its potential impact on oil uptake. China’s exporters have been hurt by the US tariffs, as both countries attempt to resolve a nearly yearlong dispute ahead of a Dec 15 deadline that will see annual tariffs on $156B in China goods raised to 15%. West Texas Intermediate crude for Jan delivery fell 31¢ (0.5%) at $58.89 a barrel after the commodity booked a 7.3% weekly gain on Fri, marking the biggest such rise since the week ended Jun 21. Feb Brent crude shed 28¢ (0.4%) to $64.11 a barrel after the global oil benchmark logged a 6.5% weekly return, also the biggest such rise since the week ended Jun 21. Fri saw both benchmarks notch their highest settlements since Sep.
Markets are taking a breather after the 3 day rally last week. While there is plenty of excitement in DC to absorb, the drama from China keeps coming. Nobody knows how that will turn out. The USMCA is still out there, although at this late stage so close to year's end, it seems unlikely that Congress will pass legislation this year. The bulls are happy to see the chart below is a reminder that the Dow is hanging in just under its record highs.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 58.92 | -0.28 | -0.5% |
| GC=F | Gold | 1,466.70 | +1.60 | +0.1% |
A Chinese official says Beijjing wants a prompt settlement of its trade war with DC. A deputy commerce minister said today that Beijing wants “satisfactory results as soon as possible.” The official gave no details of talks on a “Phase 1" deal announced by Pres in Oct. Another US tariff hike on $160B of Chinese imports is due to take effect Sun. China announced Fri it was carrying out a promise to waive punitive tariffs on American soybeans & pork. Trump alarmed global financial markets last week when he said he might be willing to wait until after next year's presidential election to reach a settlement.
Chinese official: Beijing wants US trade deal ASAP
Communist Party has ordered all state offices to remove foreign hardware & software within 3 years in a move which could hit major US firms such as Microsoft (MSFT), a Dow stock. The policy has been dubbed “3-5-2” because the replacement of the technology will happen at a pace of 30% in 2020, 50% in 2021 & 20% in 2022. Analysts estimate that 20-30M pieces of foreign equipment need to be replaced in China. China Securities said that the order had come from the Chinese Communist party's Central Office earlier this year. While the directive is not public, 2 cybersecurity firms said that their gov clients described the policy to them. Beijing's move comes against the backdrop of the ongoing US-China trade war in which technology has been front & center. China's technology firms have been the target of US pressure. Earlier this year, Huawei was placed on a US blacklist which stopped American firms doing business with the Chinese telecom networking giant. The US expanded its blacklist in Oct to include a number of Chinese surveillance firms like Hikvision, one of the world's biggest companies for such technology. A provision of a US law known as the National Defense Authorization Act also prohibits executive gov agencies from procuring telecommunications hardware made by Huawei & another Chinese firm, ZTE.
China reportedly orders state offices to remove foreign tech which could hit US firms like Microsoft
Oil futures declined, retreating from their highest settlement since Sep, as signs of economic weakness in China undercut bullishness in the aftermath of last week’s important gathering of global producers. Data out of China showed that global exports were off 1.1% from a year earlier at $221.7B, refreshing concerns about the world's 2nd-largest economy & its potential impact on oil uptake. China’s exporters have been hurt by the US tariffs, as both countries attempt to resolve a nearly yearlong dispute ahead of a Dec 15 deadline that will see annual tariffs on $156B in China goods raised to 15%. West Texas Intermediate crude for Jan delivery fell 31¢ (0.5%) at $58.89 a barrel after the commodity booked a 7.3% weekly gain on Fri, marking the biggest such rise since the week ended Jun 21. Feb Brent crude shed 28¢ (0.4%) to $64.11 a barrel after the global oil benchmark logged a 6.5% weekly return, also the biggest such rise since the week ended Jun 21. Fri saw both benchmarks notch their highest settlements since Sep.
Oil prices edge lower after OPEC+ gathering, as traders focus on weak China data
Markets are taking a breather after the 3 day rally last week. While there is plenty of excitement in DC to absorb, the drama from China keeps coming. Nobody knows how that will turn out. The USMCA is still out there, although at this late stage so close to year's end, it seems unlikely that Congress will pass legislation this year. The bulls are happy to see the chart below is a reminder that the Dow is hanging in just under its record highs.
Dow Jones Industrials
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