Dow rose 220 (near sesion highs), advancers over decliners about 2-1 & NAZ went up 63. The MLP index added 1+ to the 211s & the REIT index sank 5+ to the 392s. Junk bond funds advanced modestly & Treasuries declined in price. Oil rose to the 59s & gold was off 1 to 1474 (more on both below).
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
The Trump administration appeared to move closer to a trade deal with China as the pres was set to meet with his top economic advisors this PM. The White House has offered to scrap its next round of tariffs on Chinese goods set to take effect Sun & slash some existing duties in ½, 2 sources said. The US proposed cutting existing tariffs on $360B in Chinese products by 50%. The development signals the White House's willingness to rein in a trade war between the 2 large economies that threatens to drag on global growth. It was reported that the US reached a trade deal in principle in China, pending approval from Pres Trump. But it's unclear how the agreement the news outlet describes differs from a partial deal the president announced in Oct. Duties of 15% on about $160B in consumer goods are set to take effect on Sun, including on Chinese-made toys, computers, phones & clothing. This AM, Trump signaled optimism about an agreement with China. He tweeted that the US has moved close to a trade deal with Beijing after several false starts & near misses. “Getting VERY close to a BIG DEAL with China. They want it, and so do we!” the pres wrote. The White House tariff offer to Beijing today, came last week & may have changed. Recent talks have taken place mostly at the deputy level as Trade Representative Robert Lighthizer tries to push the administration's NAFTA replacement thru Congress. Trump's acknowledgement that the US wants a deal marks a shift in tone from recent weeks. Trump wants a broad trade agreement with China to address concerns about intellectual property theft, forced technology transfers & trade deficits. The pres, who promised to crack down with China during his 2016 campaign, sees an agreement as an economic & political priority ahead of his 2020 reelection bid.
Trump meets with advisors as US inches closer to a China trade pact
US weekly jobless claims race to a more than 2-year high
Brazilian food processors are poised to boost pork & chicken exports in 2020 as Chinese demand for meat imports remains strong while the Asian country deals with severe disruptions in local meat production, an industry group said. While an outbreak of African swine fever affects solely pork supplies in China & other Asian countries, a fall in production of that type of meat will drive demand for other products including chicken, said ABPA, which represents pork & poultry producers. ABPA forecast Brazilian pork exports may grow by as much as 15% next year, to 850-900K tonnes, & projected Brazilian chicken exports rising to as much as 4.5M tonnes, a 7% rise from upper range of 2019 export projections of 4.2M tonnes. The deadly pig disease in China has reduced domestic pork production by an estimated 13M tonnes in 2019, according to projections cited by ABPA. The nation will need around 5 years to restore internal pork supplies after the outbreak of the disease, which is harmless to humans but fatal to the animals, ABPA said. The projections underscore the lasting effects of the sanitary problem in China, which is the world's largest producer of pork with annual output of about 54M tonnes. Between Jan & Nov, Brazil increased pork exports to China by 51% to 218K tonnes. Chicken exports to China rose by 28% to 513K tonnes over the period.
Oil futures settled higher, nearly recouping all losses from a day earlier, following a tweet from Pres Trump that hinted the US was close to a trade deal with China. “Getting VERY close to a BIG DEAL with China. They want it, and so do we!” Trump tweeted, prompting a move higher in oil prices in the minutes after the tweet. A deal would ease worries about a slowdown in energy demand. As of this AM it was reported that US negotiators reached terms of a phase-one trade deal with China, which awaits Trump's approval. Prices already were on the rise after central banks signaled a willingness to keep interest rates low & maintain economic stimulus for the foreseeable future which may help to boost the global economy and buoy crude demand. The Federal Reserve yesterday said its decision to hold benchmark interest rates unchanged at 1.5-1.75% is at least partly due to worries about the potential harm from Sino-American trade clashes. In addition to the Fed, today the ECB announced its decision to keep its main deposit rate at negative 0.5%, while maintaining its rate of asset purchases at €20B a month, as widely expected. Optimism about the reception of Saudi Arabia's behemoth oil refinery IPO during its 2nd day of trading also provided a lift to oil markets. West Texas Intermediate crude for Jan delivery picked up 42¢ (0.7%) to settle at $59.18 a barrel, after trading as high as $59.72. It lost 0.8% yesterday. Feb Brent crude gained 48¢ (0.8%) to settle at $64.20 a barrel, following a 1% slide a day earlier.
Oil prices settle higher on trade deal optimism, central-bank stimulus
Gold prices ended lower as Pres Trump’s tweet that a trade deal with China is near rallied the stock market, dulling demand for the haven metal. Gold prices had been trading higher early today, with uncertainties surrounding a UK election & dovish stances by the Federal Reserve & the ECB helping to provide support. Today, however, Trump tweeted: “Getting VERY close to a BIG DEAL with China. They want it, and so do we!” Feb gold fell $2.70 (0.2%) to settle at $1472 an ounce, down significantly from the day's high of $1491. Precious commodities like gold & silver also have benefited from US-China trade tensions & doubts about the outcome of the UK's general election today. Prime Minister Boris Johnson's Conservative party leads in recent polling but his advantage over the rival Labour Party amid worries that the race between the Conservatives & the Labour Party has narrowed, casting some uncertainty on Britain's plan to exit from the EU.
Traders are waiting to hear word on details of a US-China trade deal. Hopes are high. After midday lows, buying in the PM pushed averages to session highs bringing stock indices near record levels. More news on the trade front should come shortly.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
The Trump administration appeared to move closer to a trade deal with China as the pres was set to meet with his top economic advisors this PM. The White House has offered to scrap its next round of tariffs on Chinese goods set to take effect Sun & slash some existing duties in ½, 2 sources said. The US proposed cutting existing tariffs on $360B in Chinese products by 50%. The development signals the White House's willingness to rein in a trade war between the 2 large economies that threatens to drag on global growth. It was reported that the US reached a trade deal in principle in China, pending approval from Pres Trump. But it's unclear how the agreement the news outlet describes differs from a partial deal the president announced in Oct. Duties of 15% on about $160B in consumer goods are set to take effect on Sun, including on Chinese-made toys, computers, phones & clothing. This AM, Trump signaled optimism about an agreement with China. He tweeted that the US has moved close to a trade deal with Beijing after several false starts & near misses. “Getting VERY close to a BIG DEAL with China. They want it, and so do we!” the pres wrote. The White House tariff offer to Beijing today, came last week & may have changed. Recent talks have taken place mostly at the deputy level as Trade Representative Robert Lighthizer tries to push the administration's NAFTA replacement thru Congress. Trump's acknowledgement that the US wants a deal marks a shift in tone from recent weeks. Trump wants a broad trade agreement with China to address concerns about intellectual property theft, forced technology transfers & trade deficits. The pres, who promised to crack down with China during his 2016 campaign, sees an agreement as an economic & political priority ahead of his 2020 reelection bid.
Trump meets with advisors as US inches closer to a China trade pact
The number of Americans filing applications for
unemployment benefits jumped to more than a 2-year high last week, but
that probably does not signal a pickup in layoffs as the claims data
tends to be volatile in the period following the Thanksgiving Day
holiday. Initial claims for state unemployment benefits surged
49K to a seasonally adjusted 252K last week, the
highest reading since Sep 2017, the Labor Dept said. The increase was the largest since Aug 2017. Claims
dropped to 203K in the prior week, which was a 7-month low. The
decline likely reflected a late Thanksgiving Day this year compared to
2018, which could have thrown off the model used by the gov to
strip out seasonal fluctuations from the data. The forecast called for an increase to 213K last
week. The 4-week moving average of initial
claims, considered a better measure of labor market trends as it irons
out week-to-week volatility, rose 6K to 224K last week. The
underlying trend in claims remains consistent with a strong labor
market. The claims report also showed the number of people receiving
benefits after an initial week of aid dropped 31K to 1.67M for
the latest week. The 4-week moving average of
continuing claims fell 6K to 1.68M.
US weekly jobless claims race to a more than 2-year high
Brazilian food processors are poised to boost pork & chicken exports in 2020 as Chinese demand for meat imports remains strong while the Asian country deals with severe disruptions in local meat production, an industry group said. While an outbreak of African swine fever affects solely pork supplies in China & other Asian countries, a fall in production of that type of meat will drive demand for other products including chicken, said ABPA, which represents pork & poultry producers. ABPA forecast Brazilian pork exports may grow by as much as 15% next year, to 850-900K tonnes, & projected Brazilian chicken exports rising to as much as 4.5M tonnes, a 7% rise from upper range of 2019 export projections of 4.2M tonnes. The deadly pig disease in China has reduced domestic pork production by an estimated 13M tonnes in 2019, according to projections cited by ABPA. The nation will need around 5 years to restore internal pork supplies after the outbreak of the disease, which is harmless to humans but fatal to the animals, ABPA said. The projections underscore the lasting effects of the sanitary problem in China, which is the world's largest producer of pork with annual output of about 54M tonnes. Between Jan & Nov, Brazil increased pork exports to China by 51% to 218K tonnes. Chicken exports to China rose by 28% to 513K tonnes over the period.
China's swine fever disruption expected to increase Brazil's 2020 pork, chicken exports
Oil futures settled higher, nearly recouping all losses from a day earlier, following a tweet from Pres Trump that hinted the US was close to a trade deal with China. “Getting VERY close to a BIG DEAL with China. They want it, and so do we!” Trump tweeted, prompting a move higher in oil prices in the minutes after the tweet. A deal would ease worries about a slowdown in energy demand. As of this AM it was reported that US negotiators reached terms of a phase-one trade deal with China, which awaits Trump's approval. Prices already were on the rise after central banks signaled a willingness to keep interest rates low & maintain economic stimulus for the foreseeable future which may help to boost the global economy and buoy crude demand. The Federal Reserve yesterday said its decision to hold benchmark interest rates unchanged at 1.5-1.75% is at least partly due to worries about the potential harm from Sino-American trade clashes. In addition to the Fed, today the ECB announced its decision to keep its main deposit rate at negative 0.5%, while maintaining its rate of asset purchases at €20B a month, as widely expected. Optimism about the reception of Saudi Arabia's behemoth oil refinery IPO during its 2nd day of trading also provided a lift to oil markets. West Texas Intermediate crude for Jan delivery picked up 42¢ (0.7%) to settle at $59.18 a barrel, after trading as high as $59.72. It lost 0.8% yesterday. Feb Brent crude gained 48¢ (0.8%) to settle at $64.20 a barrel, following a 1% slide a day earlier.
Oil prices settle higher on trade deal optimism, central-bank stimulus
Gold prices ended lower as Pres Trump’s tweet that a trade deal with China is near rallied the stock market, dulling demand for the haven metal. Gold prices had been trading higher early today, with uncertainties surrounding a UK election & dovish stances by the Federal Reserve & the ECB helping to provide support. Today, however, Trump tweeted: “Getting VERY close to a BIG DEAL with China. They want it, and so do we!” Feb gold fell $2.70 (0.2%) to settle at $1472 an ounce, down significantly from the day's high of $1491. Precious commodities like gold & silver also have benefited from US-China trade tensions & doubts about the outcome of the UK's general election today. Prime Minister Boris Johnson's Conservative party leads in recent polling but his advantage over the rival Labour Party amid worries that the race between the Conservatives & the Labour Party has narrowed, casting some uncertainty on Britain's plan to exit from the EU.
Gold ends lower as Trump tweet raises optimism that trade deal with China near
Traders are waiting to hear word on details of a US-China trade deal. Hopes are high. After midday lows, buying in the PM pushed averages to session highs bringing stock indices near record levels. More news on the trade front should come shortly.
Dow Jones Industrials
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