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Takeaways from China’s Belt and Road forum. Japan markets are shut for the week, but there is a slew of key global data that traders will be watching. Incumbent Sanchez set to be returned as Spain’s PM after election. Here’s what’s moving markets.
China’s Belt and Road Forum
Chinese President Xi Jinping wrapped up his second Belt and Road forum in Beijing. Xi hosted some 5,000 delegates from across the globe last week – though leaders from major developed nations were notably lacking — to discuss his signature infrastructure project, which began in 2013 with the aim to deepen economic ties across Eurasia. This year’s gathering eschewed the pageantry of the inaugural summit in 2017, as Beijing tried to address international criticism by toning down its rhetoric and tightening oversight. It also come amid trade negotiations with the U.S. as Trade Representative Robert Lighthizer leads American negotiators heading back to Beijing this week amid signs both sides are mulling concessions.
Big Data Week
The world economy’s ability to rebound from its recent soft patch will be tested anew this week as data is released from Washington to Beijing. Federal Reserve officials conclude their latest policy meeting on Wednesday amid expectations they won’t change their monetary settings as counterparts elsewhere follow their dovish turn. Chairman Jerome Powell’s press conference will be eyed for insights into his view of the outlook and thinking on the Fed’s inflation target and bond portfolio. The high point for U.S. data will be Friday’s release of the U.S. jobs report for April, with a gain of about 185,000 expected by the consensus of economists surveyed by Bloomberg News. Elsewhere, China releases its purchasing managers index on Tuesday, the same day that the euro-area is predicted to show its economy steadied in the first quarter. Economists expect further steadying in China’s factory gauge in April.
Asian stocks looked set for a mixed start to a week and volumes are likely to be down with Japanese markets shut for holidays. Futures signaled gains at the start of trading for equities in Hong Kong, while Australia was poised to open flat. U.S. stocks climbed Friday and the S&P 500 Index reached an all-time high amid a flurry of earnings reports. The euro was steady after S&P Global Ratings left Italy’s rating unchanged Friday. Results from the Spanish election had no noticeable impact. Ten-year Treasury yields dropped below 2.50 percent Friday after the strong U.S. GPD report had also showed tepid inflation.
Socialist Pedro Sanchez is set to return as prime minister of Spain after his party and left-leaning allies came close to a majority, though he may still need a handful of votes from Catalan separatists. A second Sanchez government would buck the trend of crumbling voter support for Europe’s other center-left parties. He’s already served 10 months as the head of a minority government but was forced to call a snap election when he failed to pass his budget.
New Questions About Boeing’s 737 Max
Southwest Airlines Co., after a deadly Lion Air crash in October, learned from Boeing Co. that an alert warning pilots of a sensor malfunction linked to the disaster wasn’t a standard feature on the 737 Max. The world’s largest 737 operator and its pilots had thought that the warning light worked on all Max jets, as it had on the previous generation of 737 aircraft, Southwest said Sunday. The airline only learned after the accident that on the Max, the feature was connected to a separate indicator display — available for a fee — that provides readings from the plane’s two angle-of-attack vanes. The revelation raises new questions about Boeing’s best-selling jet as the company works to convince airlines and regulators that the Max will be safe once a software update is installed.
What We’ve Been Reading
This is what’s caught our eye over the weekend.
- Hong Kong banks are on an unusual hiring spree.
- China to invest $3.4 billion in Dubai.
- Ways to tell if we are in a market melt-up.
- Tech’s $1 trillion rally keeps on rolling.
- Warren Buffett’s bet on Dubai property market.
- Here’s where to find Asia’s longest-serving company directors.
- India has slipped further behind China in Modi’s first five years.
©2019 Bloomberg L.P.