Five Things You Need to Know to Start Your Day
Get up to date on what’s moving global markets this morning.
(Bloomberg) --
Phone call points to progress on trade deal, Powell is a glass-half-full guy, and Hong Kong calm may be short-lived. Here are some of the things people in markets are talking about today.
Reaching consensus
Chinese and U.S. top trade negotiators held another phone call this morning Beijing time in which consensus was reached on properly resolving issues holding up the phase-one trade deal, according to a Chinese Ministry of Commerce statement. Should they fail to reach an agreement by Dec. 15, President Donald Trump will have to decide whether to carry out his threat of further tariffs on the Asian nation. Market reaction to the statement has been muted, with Rabobank strategists including Richard McGuire writing that markets now view positive announcements with “healthy skepticism given how long this has dragged out.”
Optimistic
Federal Reserve Chairman Jerome Powell signaled interest rates would probably remain on hold, saying that he sees “the glass as much more than half full.” He restated his well-worn caveat that interest rates are not on a preset course, and the Fed would adjust if there were a “material” change to its outlook. Investors and economists meanwhile are touting a further steepening of the yield curve in their hot 2020 trades for Wall Street.
No concessions
Despite the huge victory for pro-democracy candidates in the weekend election, Hong Kong leader Carrie Lam did not make any new concessions to protesters in her first weekly press briefing since the vote. She restated her September proposal for community dialogue, with many predicting her failure to move will lead to more violence. A team searching the Hong Kong Polytechnic University, the site of much of the recent violence, only found one person hiding on the premises.
Markets drift
Global stock markets seem to be treating the latest trade news with something of a “boy who cried wolf” attitude. Overnight, the MSCI Asia Pacific Index rose less than 0.1% while Japan’s Topix index closed 0.2% higher, easing from an early-session 13-month high. In Europe, the Stoxx 600 Index was broadly unchanged at 5:50 a.m. Eastern Time after hitting the highest level since 2015 in yesterday’s trade. S&P 500 futures also point to very little change at the open, the 10-year Treasury yield was at 1.745% and gold was higher.
Coming up…
U.S. October wholesale inventories data is released at 8:30 a.m., with September house prices at 9:00 a.m. Both consumer confidence and home sales are expected to show improvement when they are published at 10:00 a.m. Fed Governor Lael Brainard is due to speak in New York. Earnings today have a tech theme, with VMware Inc., Dell Technologies Inc., HP Inc. and Analog Devices Inc. all announcing results.
What we've been reading
This is what's caught our eye over the last 24 hours.
- Trump’s trade threat brings world to the edge of “jungle” rule.
- The UN says the global climate outlook is bleak.
- China faces biggest state firm offshore debt failure in 20 years.
- Smaller U.S. stocks could be set for a big run into the end of the year.
- How China CFA applicants keep beating finance’s hardest exam.
- Musk accepts Ford challenge to apples-to-apples truck tug of war.
- Jupiter’s great red spot isn’t dying anytime soon.
To contact the editor responsible for this story: Cecile Gutscher at cgutscher@bloomberg.net, Sid Verma
©2019 Bloomberg L.P.