Dow shot up 172, advancers over decliners almost 3-1 & NAZ climbed 63. The MLP index was fractionally higher in the 227s & the REIT index rose 2 to the 412s. Junk bond funds fluctuated & Treasuries were sold. Oil rose to the 58s & gold slid back 2 to 1551.
AMJ (Alerian MLP Index tracking fund)
Stocks opened in record territory as traders readied for the approval of the 2nd historic trade deal in as many days. All 3 major averages were trading at all-time highs ahead of the Senate's vote on the US-Mexico-Canada Agreement, which, once ratified by all 3 countries will replace the North American Free Trade Agreement. The S&P 500 & Dow closed at record highs yesterday after the signing of the phase one trade deal between the US & China. For the Dow, it was the first close above 29K. Today gold inched higher at $1556 an ounce & West Texas Intermediate crude oil was little changed at $57.85 a barrel. Treasurys were flat with the yield on the 10-year note holding at 1.79%. Economic data was better than expected as retail sales ex-autos, the Philadelphia Fed & initial claims all beat expectations. Markets were weaker across Europe with Britain's FTSE down 0.5% while both Germany's DAX & France’s CAC were off by 0.2%. In Asia, China's Shanghai Composite fell 0.5% after the signing of the phase one trade deal while Hong Kong's Hang Seng & Japan's Nikkei gained 0.4% & a smidgen, respectively.
The US-Mexico-Canada Agreement (USMCA) along with the recently signed phase 1 portion of the US-China trade deal will equate to $2T in trade, Commerce Secretary Wilbur Ross said. Ross added that China's commitment to purchase an additional $200B of US products over the next 2 years will add about a ½ a percentage point of GDP growth. “Very hard to imagine a recession occurring in the face of these two trade deals,” he said. Pres Trump & China Vice Premier Liu He made the landmark trade agreement official yesterday when they signed the phase one deal during a ceremony in DC. Meanwhile, 5 Senate committees are expected to join the Senate Finance Committee in approving the revamped $1.2T North American trade deal, before all 100 senators vote as one body. Sen Joni Ernst said that the Senate will likely approve the USMCA at 11 AM. Once the Senate passes the USMCA, it would head to Trump's desk to be signed, the last step before it begins to be implemented. The House voted 385-41 to approve it in Dec. Sen James Lankford said that it would hit Trump's desk at noon after it passes the Senate. Ross said the USMCA & phase one “solidifies” the US base & gives it a stronger position for negotiating trade deals in the future.
The EU's trade chief said that the bloc would check to see if a major trade deal struck by the US & China is compliant with global rules. “The devil is in the detail,” EU Trade Commissioner Phil Hogan told a conference in London, speaking by video link from DC where he is meeting US officials this week. “We will have to assess whether it is WTO compliant.” DC & Beijing yesterday scaled back their 18-month trade row that has hit global economic growth by signing an initial deal under which China will boost purchases of US goods & services by $200B over 2 years in exchange for the rolling back of some US tariffs.
The global economy may be fragile but consumers still feel good about their situation, new data from Ipsos shows. The Ipsos Global Consumer Confidence Index, which measures consumer confidence across 24 countries, came in at 48.7 for Jan, just 1.5 points below an all-time high of 50.2 set in May 2018. The index also bounced from its lowest level in 2 years. Consumers in the US, Great Britain, Argentina & South Africa were among the ones whose confidence grew the most, the data showed. This consumer resilience seen around the world comes even as experts fret over the state of the global economy. In late Dec, the IMF trimmed its global growth forecast for 2020 to 3.5% from 3.6%, citing potential risks geopolitical tensions & deflationary pressures. Meanwhile, manufacturing activity in the euro zone contracted last month while the US manufacturing sector fell to its worst level since 2009. Nicolas Boyon, senior VP of public affairs at Ipsos, said consumers remain confident despite the slowdown given their employment security & market outlook. “The job situation has improved in a lot of places,” he said. “Even in a number of European countries, it is better than it was five or 10 years ago.”
Consumers around the world are confident despite fragile global economy, data shows
Economic data is coming in good today & the bulls are feeling great after all the excitement on the trade deals. For the time being the rally has following winds.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 58.22 | +0.41 | +0.7% |
| GC=F | Gold | 1,553.70 | -0.30 | -0.0% |
Stocks opened in record territory as traders readied for the approval of the 2nd historic trade deal in as many days. All 3 major averages were trading at all-time highs ahead of the Senate's vote on the US-Mexico-Canada Agreement, which, once ratified by all 3 countries will replace the North American Free Trade Agreement. The S&P 500 & Dow closed at record highs yesterday after the signing of the phase one trade deal between the US & China. For the Dow, it was the first close above 29K. Today gold inched higher at $1556 an ounce & West Texas Intermediate crude oil was little changed at $57.85 a barrel. Treasurys were flat with the yield on the 10-year note holding at 1.79%. Economic data was better than expected as retail sales ex-autos, the Philadelphia Fed & initial claims all beat expectations. Markets were weaker across Europe with Britain's FTSE down 0.5% while both Germany's DAX & France’s CAC were off by 0.2%. In Asia, China's Shanghai Composite fell 0.5% after the signing of the phase one trade deal while Hong Kong's Hang Seng & Japan's Nikkei gained 0.4% & a smidgen, respectively.
Stocks rally to record highs ahead of USMCA vote
The US-Mexico-Canada Agreement (USMCA) along with the recently signed phase 1 portion of the US-China trade deal will equate to $2T in trade, Commerce Secretary Wilbur Ross said. Ross added that China's commitment to purchase an additional $200B of US products over the next 2 years will add about a ½ a percentage point of GDP growth. “Very hard to imagine a recession occurring in the face of these two trade deals,” he said. Pres Trump & China Vice Premier Liu He made the landmark trade agreement official yesterday when they signed the phase one deal during a ceremony in DC. Meanwhile, 5 Senate committees are expected to join the Senate Finance Committee in approving the revamped $1.2T North American trade deal, before all 100 senators vote as one body. Sen Joni Ernst said that the Senate will likely approve the USMCA at 11 AM. Once the Senate passes the USMCA, it would head to Trump's desk to be signed, the last step before it begins to be implemented. The House voted 385-41 to approve it in Dec. Sen James Lankford said that it would hit Trump's desk at noon after it passes the Senate. Ross said the USMCA & phase one “solidifies” the US base & gives it a stronger position for negotiating trade deals in the future.
Wilbur Ross reveals the awesome scope of Trump's China, USMCA trade deals
The EU's trade chief said that the bloc would check to see if a major trade deal struck by the US & China is compliant with global rules. “The devil is in the detail,” EU Trade Commissioner Phil Hogan told a conference in London, speaking by video link from DC where he is meeting US officials this week. “We will have to assess whether it is WTO compliant.” DC & Beijing yesterday scaled back their 18-month trade row that has hit global economic growth by signing an initial deal under which China will boost purchases of US goods & services by $200B over 2 years in exchange for the rolling back of some US tariffs.
EU to see test Trump's China trade deal against WTO standards
The global economy may be fragile but consumers still feel good about their situation, new data from Ipsos shows. The Ipsos Global Consumer Confidence Index, which measures consumer confidence across 24 countries, came in at 48.7 for Jan, just 1.5 points below an all-time high of 50.2 set in May 2018. The index also bounced from its lowest level in 2 years. Consumers in the US, Great Britain, Argentina & South Africa were among the ones whose confidence grew the most, the data showed. This consumer resilience seen around the world comes even as experts fret over the state of the global economy. In late Dec, the IMF trimmed its global growth forecast for 2020 to 3.5% from 3.6%, citing potential risks geopolitical tensions & deflationary pressures. Meanwhile, manufacturing activity in the euro zone contracted last month while the US manufacturing sector fell to its worst level since 2009. Nicolas Boyon, senior VP of public affairs at Ipsos, said consumers remain confident despite the slowdown given their employment security & market outlook. “The job situation has improved in a lot of places,” he said. “Even in a number of European countries, it is better than it was five or 10 years ago.”
Consumers around the world are confident despite fragile global economy, data shows
Economic data is coming in good today & the bulls are feeling great after all the excitement on the trade deals. For the time being the rally has following winds.
Dow Jones Industrials
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