As mentioned in yesterday’s MT, the U.S. raised tariffs on China after the most recent deadline of 12 midnight eastern had passed. Trump earlier this week said that he was frustrated by the lack of progress (regression) in negotiations, while today he stated there is no rush to the ongoing talks now that the tariffs are in place. After today’s negotiations concluded, US Treasury Secretary Mnuchin stated there is no set time yet on next round of talks. See more below in US / Americas section.
In Japan, they successfully tested the world’s fastest bullet train (magnetic technology) which travels at 400 Kmph (249 Mph). Tests are due to be ongoing for three years, and the train is expected to be operational around 2030.
After a recent citizen list in India was conducted, millions of people found themselves excluded from the list and face uncertain futures. Phase 6 of the world’s largest elections is due to take place over the weekend with the final counting on May 23rd.
The major Asian stock markets had a mixed day today. ASX 200 increased 15.60 points (0.25%) to 6,310.90; Hang Seng increased 239.17 points (0.84%) to 28,550.24; Shanghai increased 88.26 points (3.10%) to 2,939.21; KOSPI increased 6.03 points (0.29%) to 2,108.04. However, NIKKEI 225 and SENSEX took the opposite route decreased 57.21 points (-0.27%) to 21,344.92 and 95.92 points (-0.26%) to 37,462.99 respectfully.
The major Asian currency markets had a green day today: AUDUSD increased 0.0013 or 0.19% to 0.7001; NZDUSD increased 0.0009 or 0.14% to 0.6599; USDJPY increased 0.1410 or 0.13% to 109.8910; and USDCNY increased 0.0106 or 0.16% to 6.8468.
Gold increased 2.36USD/t oz. or 0.18% to 1,284.38 and silver increased 0.019 USD/t. oz or 0.13% to 14.7730.
Some economic news:
The EU parliament’s Brexit coordinator Guy Verhofstadt has warned that a Brexit type of event cannot occur as it has already done far more damage than ever predicted.
Germany surprised most with a rise in exports in March, giving more hope of a sustained improvement to European growth. Meanwhile, the FT did a piece suggesting that the US treats Germany as their worst ally.
Today, Germany tested overhead wires to charge hybrid trucks on highways. This will allow trucks to use only electric at speeds of less than 56 mph whilst systematically charging the vehicles battery. The test site is currently 6 miles long just outside of Frankfurt.
Greece’s former finance minister is trying to convince voters to elect him under an EU party, not in his native country Greece, but in Germany. The party’s calling card is democracy in Europe.
The major European stock markets had a mixed day today. CAC 40 increased 14.29 points or 0.27% to 5,327.44 and DAX increased 85.91 points or 0.72% to 12059.83. The FTSE 100 took the opposite route and decreased 4.12 points, or -0.06% to 7,203.29.
The major European currency markets had a mixed day today. GBPUSD decreased 0.0010 or 0.08% to 1.3003 and USDCHF decreased 0.0032 or 0.31% to 1.0118. EURUSD took the opposite route and increased 0.0011 or 0.10% to 1.1231.
Some economic news:
US / AMERICAS:
The U.S. markets showed signs of improvement this Friday after President Trump commented the U.S. and China continuing trade talks and positive communication with Chinese President Xi Jinping. The Dow, down over 350 points earlier in the day, had a nice turnaround closing up 114.01 points (+0.44%) at 25942.37. The S&P 500 had a similarly strong close, finishing up 10.68 points (+0.37%) to close at 2881.40. Meanwhile the Nasdaq rallied to close just barely positive, up 6.35 points (+0.08%) at 7916.94. The Russell 2000 added 2.94 points (+0.19%), closing at 1572.99.
Utilities (+1.73%), Materials (+1.27%), Consumer Staples (+1.17%) and Real Estate (+1.13%) were the leading US sectors. Walmart (+2.38%), P&G (+1.70%), Coca Cola (+1.67%), Travelers (+1.50%) and Microsoft (+1.30%) lead the Dow, while Apple (-1.39%) and Intel (-0.90%) were the notable laggards.
As mentioned previously, the U.S. has officially raised tariffs from 10% to 25% on $200 billion worth of Chinese goods despite China’s Vice Premier visited the White House last night to dissuade the U.S. from raising tariffs. Talks were reportedly productive, but no agreement was reached and the tariff hike was implemented.
The Ministry of Commerce of the People’s Republic of China released the following statement (translated): “The US has raised the tariff on the US$200 billion to China’s exports to the United States from 10% to 25%. China deeply regrets that it will have to take necessary countermeasures. The eleventh round of China-US high-level economic and trade consultations is underway. It is hoped that the US and the Chinese side will work together and work together to resolve existing problems through cooperation and consultation.”
China has not yet addressed what “necessary countermeasures” they will take against America. As the day progressed, the “trade war” seemingly retreated to “trade discussions” once more. President Trump announced that his relationship with Chinese President Xi “remains a very strong one,” easing concerns of deeper political contention between the two economic powerhouses. The U.S. president made clear intention of trade discussions with China to continue, but until an agreement is reached the tariffs will remain in place.
President Trump’s official statement: “Over the course of the past two days, the United States and China have held candid and constructive conversations on the status of the trade relationship between both countries. The relationship between President Xi and myself remains a very strong one, and conversations into the future will continue. In the meantime, the United States has imposed Tariffs on China, which may or may not be removed depending on what happens with respect to future negotiations!”
On a separate note, Uber completed its first official day on the NYSE. It was priced last night (Thursday) at $45 per share, but opened at $42 per share when traded began today. The stock closed at $41.57 for a disappointing debut. But no large company is made or destroyed simply based on its first day, week or month of public trading.
The Canadian markets failed to recuperate losses today. The TSX Composite dropped 24.20 points (-0.15%), finishing the day at 16297.55. The TSX 60 lost -0.19% and closed at 978.05.
In Brazil, the Bovespa continued to decline, dropping 550.29 points this Friday (-0.58%, 94257.56 close).
Libya has an investment of 60 billion USD that will double oil production from 1 million bpd to 2.1 million bpd by 2023.
The oil markets had a mixed day today. Brent increased 0.33 USD/BBL or 0.47% to 70.7609; Natural gas increased 0.03USD/MMBtu or 1.16% to 2.6239; Gasoline increased 0.0144 USD/GAL or 0.73% to 1.9894; and Heating oil increased 0.012 USD/GAL or 0.59% to 2.0566. However, Crude Oil took the opposite route and decreased 0.01 USD/BBL or -0.02% to 61.5764.
Top commodity gainers were Orange Juice (1.65%), Rubber (2.96%), Platinum (2.34%), and Palladium (4.87%). The biggest losers were Oat (-9.13%), Cotton (-2.53%), Corn (-1.02%), and Wheat (-0.95%).
The above data was collected around 16:25 EST on Friday.
Japan -0.04%(+1bp), US 2’s 2.25% (-2bps), US 10’s 2.45%(-0bps), US 30’s 2.87%(-0bps), Bunds -0.04% (+2bp), France 0.35% (+1bp), Italy 2.69% (+2bp), Turkey 19.99% (-32bp), Greece 3.52% (-2bp), Portugal 1.14% (+2bp), Spain 0.98% (-2bp) and UK Gilts 1.14% (+2bp). Italian 12-Month BOT Auction increased from 0.070% to 0.122%.