ASIA / AUSTRALIA:
Some positive news for US-Chinese relations as Tesla has started to take pre-orders on it cheaper Model 3 cars from its Gigafactory based in Shanghai. The construction of the factory only started at the beginning of January and is expected to open later this year.
The former governor of the People’s Bank of China expressed his concern about the trade war enlarging into a global financial crisis. “If the China-U.S. trade war continues to grow larger, it may cause the global economy to decline, and may cause a global financial crisis,”
News media outlets are claiming that China will soon reciprocate and ban US companies in China; currently they are setting up an “unreliable entities list” which are companies which could damage the interest of domestic companies.
A meeting in Singapore has taken place with US, Japanese and South Korean officials to discuss the threat of North Korea. Earlier this month, North Korea was said to test two types of short range ballistic missiles.
Looking to the markets, Gold increased 13.1 USD/t oz. or +1.02% to 1,299.58 and Silver increased 0.0785 USD/t. oz or +0.54% to 14.5906.
The major Asian stock markets had a mixed day today:
The major Asian currency markets had a mixed day today:
Some economic news:
South Korea:
Japan:
Indonesia:
China:
Australia:
Singapore:
HongKong:
India:
EUROPE / EMEA:
US Secretary of State Mike Pompeo has flown to Germany today to meet with German Foreign Minister Heiko Maas and Chancellor Angela Merkel. They were due to meet earlier in the month, when Secretary of State cancelled the visit at the last moments. Topics of conversation will likely include the Chines trade deal and the issue of Iran. He is expect to visit Switzerland and Netherlands before teaming up with Trump.
Trump meanwhile will be visiting the UK for a 3 day trip, whom was invited by the Queen of England. His trip is expected to cost more than 18 million pounds due to security measures which will take place.
In the UK, Telecoms company EE has turned on their 5G signal today; users were experiencing downloading speeds of up to 1000 Mbps. There is a backlash over the health concerns 5G brings; as there have been little or no scientific test prior to roll out.
Hungary has announced plans to construct a 1 billion Euro greenhouse city which is powered by renewable energy. The city is expected to be carbon neutral and provide year round cultivation. It is unknown when the project is going to take place.
Major Europe stock markets had a negative day today:
Major Europe currency markets had a mixed day today:
Some economic news:
UK:
Germany:
Swiss:
Italy:
Spain:
Norway:
U.S. / AMERICAS:
Another day, another tariff dustup – this time, not due to trade conflict, but due to ongoing concern of illegal immigration. No, really. What seems like out of nowhere, President Trump sent a tweet last night stating “On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied,.. at which time the Tariffs will be removed. Details from the White House to follow.” This, while the US, Canada and Mexico are making efforts to get the proposed North American trade agreement that will replace NAFTA (the USMCA) ratified and put into effect.
It is one thing to utilize tariffs in attempts to create economic pressures that motivate negotiations towards new trade agreements – but it is another thing entirely to use them for what seems like an otherwise inability to get immigration under control through bi-partisan efforts here, and with a very important trade partner you are trying to seal (an already agreed to) deal with. Illegal immigration is a real issue, and does need a real solution – just not sure this is the way to go about it. Most believe this will quickly turn around though, as this would likely hit US industry (autos in particular) pretty hard, something Trump would in theory want to avoid.
This, unsurprisingly, had a negative impact on markets today, driving the final nail on a down week (six straight down weeks for the Dow; fourth straight down weeks for S&P 500 and Nasdaq Composite as well).
Major stock markets across the Americas were in the red today:
ENERGY:
Crude oil is still moving down due to the ongoing fears of a global slowdown; OPEC are also expected to cut output despite Saudi producing 200,000 more barrels a day to cover the void left by the Iranian sanctions.
Elsewhere, Indian envoy to the US has told that they have not imported oil from Iran since the sanctions have been posed, this contradicts reports that business is still ongoing.
The oil markets had a negative day today:
Top commodity gainers: Orange Juice (3.59%), Sugar (1.19%), Gold (1.09%), and Palm Oil (0.50%). Top commodity losers: Brent (-3.39%), Crude Oil (-3.07%), Gasoline (-3.50%), and Heating Oil (-3.02%)
The above data were collected around 12:18PM EST on Friday.
BONDS:
Japan -0.09%(-1bp), US 2’s 2.03% (-5bps), US 10’s 2.37%(+15bps), US 30’s 2.63%(-3bps), Bunds -0.21% (-4bp), France 0.22% (-2bp), Italy 2.76% (+11bp), Turkey 18.62% (+0bp), Greece 3.06% (+0bp), Portugal 0.82% (-5bp), Spain 0.76% (-0bp) and UK Gilts 0.87% (-3bp).
