Five Things You Need to Know to Start Your Day
U.S. stocks rallied Tuesday as optimism over trade talks and signs Washington will avert another shutdown boosted investor confidence. Here are some of the things people in markets are talking about.
Trump Seeks “Real Deal” With China
President Donald Trump said he’s open to extending a March 1 deadline to raise tariffs on Chinese products if the two sides are near an agreement, sending a conciliatory signal amid talks to resolve the trade war between the world’s two biggest economies. “If we’re close to a deal where we think we can make a real deal and it’s going to get done, I could see myself letting that slide for a little while,” Trump told reporters during a cabinet meeting Tuesday. “But generally speaking I’m not inclined” to delay raising tariffs, he added. Negotiators from the two countries began their latest round of talks this week ahead of the March 1 deadline for additional U.S. tariffs on Chinese goods. Trump has threatened to more than double the rate of duties on $200 billion in Chinese imports.
U.S. Stocks Rally
Asian shares looked set for gains after U.S. equities shook off their malaise Tuesday, boosted by hints that Trump may reach an accord with China and a tentative deal among American lawmakers to avert a second partial government shutdown. Treasuries and the dollar edged lower. After four sessions of losses or whisker-thin gains, the S&P 500 Index registered its biggest one-day increase this month, breaking through its 200-day moving average. The rally was broad-based: Materials stocks led the charge, but financials and the FAANG cohort of tech stocks also advanced, and energy companies gained as oil rebounded from a two-week low after Saudi Arabia pledged to deepen production cuts. U.S. lawmakers said they have reached an “agreement in principle” on border security funding that still needs Trump’s sign off. He said the preliminary agreement is “not doing the trick” but also said he has to study it and can add to it.
Florida Senator Seeks to Counter “Made in China 2025”
Senator Marco Rubio is proposing legislation that would counteract China’s " Made in China 2025" economic-development initiative by restricting and taxing Chinese investment in the U.S. and by raising import duties on goods produced by industries supported by Beijing’s program. In a report Tuesday from the U.S. Senate Committee on Small Business and Entrepreneurship on Tuesday, Rubio said he wants to use China’s plan as a road map for defensive action and to combat what he describes as an existential threat to American industry. "The American people know something has gone wrong," Rubio, a Republican from Florida, wrote in the introduction to the report. "Will our country look more like the land of shared opportunity my parents found when they arrived, or will we become a stagnant nation fighting over how to divide up what is left?"
Kim Keeps Nuclear Grip
The commander of U.S. forces in South Korea cited a “palpable” decline in tensions amid U.S.-North Korean peace talks but cautioned there’s little evidence that Kim Jong Un is willing to give up his nuclear arsenal. “Today is Day 440 since the last strategic provocation” by North Korea through a missile or nuclear test, Army General Robert Abrams told the Senate Armed Services Committee on Tuesday. That’s meant “a marked reduction in tensions” on the Korean Peninsula, he said, and a reduced risk of miscalculation. While Abrams credited President Donald Trump’s talks with Kim, which will resume in a second summit meeting in Hanoi on Feb. 27-28, as contributing to the improved atmosphere, he offered little optimism that Trump’s efforts will lead to his goal of a nuclear-free North Korea. “I remain clear-eyed,” Abrams said, that “little to no verifiable change has occurred in North Korea’s military capabilities.”
Powell Sees “Strong” Economy
Federal Reserve Chairman Jerome Powell said the U.S. economy is “strong” though its benefits haven’t been felt evenly across the country. “Today, data at the national level show a strong economy,” Powell told students Tuesday at Mississippi Valley State University. “Unemployment is near a half-century low, and economic output is growing at a solid pace.” Speaking in Itta Bena, Mississippi, located in Leflore County where unemployment at 7.3 percent in December was almost double the national average, Powell said “we know that prosperity has not been felt as much in some areas, including many rural places.” The central bank can help by delivering on its goals for price stability and full employment, he said.
What we’ve been reading
This is what caught our eye over the last 24 hours.
- What a world bank critic might do as World Bank head.
- Santander feels bondholder heat.
- Branson-branded train to Disney to be biggest U.S. IPO so far this year.
- No stopping Burgundy and Bordeaux in annual wine market report.
- Australia’s government suffers a historic defeat.
- Pig farmers are big winners in China’s Silicon Valley.
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