Written by Gary
US inflation picks up in April as spending slows (SPY -0.9%). Trump vows rapid, high tariffs on Mexico unless illegal immigration ends.
Here is the current market situation from CNN Money | |
European markets are sharply lower today with shares in Germany off the most. The DAX is down 1.73% while France’s CAC 40 is off 1.37% and London’s FTSE 100 is lower by 1.02%. |
What Is Moving the Markets
Here are the headlines moving the markets. | |
How tariff hikes are squeezing the U.S. furniture businessAfter President Donald Trump announced higher tariffs on Chinese imports earlier this month, Francis O’Brien slapped a new 4% fee on every item of furniture he sells. | |
Tesla promotes lower priced China-made Model 3 in sales pushU.S. electric vehicle (EV) maker Tesla Inc said on Friday it would price its China-made Model 3 vehicles from 328,000 yuan ($47,529), 13% cheaper than those it currently imports as it pushes sales in the fast growing market. | |
Pompeo to Germany: Use Huawei and lose access to our dataThe United States raised the pressure on Western allies in a war of attrition over next-generation networks on Friday, saying countries that allow China’s Huawei to build their telecoms infrastructure could be cut off from crucial intelligence data. | |
China threatens corporate hit-list on eve of new tariffs on U.S. importsChina threatened on Friday to unveil an unprecedented hit-list of “unreliable” foreign firms, groups and individuals that harm the interests of Chinese companies, as a slate of retaliatory tariffs on imported U.S. goods was set to kick in at midnight. | |
Stocks shiver, bonds surge on Trump’s Mexico threatSafe-haven sovereign bonds surged and European stocks tumbled on Friday as investors feared President Donald Trump’s shock threat of tariffs on Mexico risked tipping the United States into recession while disappointing China data added to the woes. | |
Canada’s Digital Charter does not comfort Alphabet’s smart-city criticsCanada’s Digital Charter lacks sufficient legal enforcement power to effectively protect privacy and regulate use of personal data, according to critics worried that a smart city project in Toronto by Alphabet’s Sidewalk Labs unit could be misused for mass surveillance. | |
Qualcomm has strong argument to win reversal of U.S. antitrust ruling: legal expertsA rare public call by a U.S. Federal Trade Commission (FTC) official for one of the agency’s courtroom victories to be reversed, in a case of anticompetitive business practices by chipmaker Qualcomm Inc, charts a strong course for a judge’s ruling to be overturned on appeal, some legal experts said. | |
Irish Supreme Court rejects Facebook bid to block ECJ data caseThe European Court of Justice (ECJ) will hear a landmark privacy case regarding the transfer of EU citizens’ data to the United States in July, after Facebook’s bid to stop its referral was blocked by Ireland’s Supreme Court on Friday. | |
Proactive checks on crypto risks needed, global watchdog FSB saysRegulators need to step up risk assessments of the cryptocurrency sector as current rules are patchy, and quick technological change may lead to gaps in policies on digital money, the global financial stability watchdog said. | |
Russian Jets Unleash Hell On Idlib After Ceasefire Talks With Turkey CollapseVia AlmasdarNews.com, On Thursday over five Russian fighter jets began launching airstrikes over the Idlib Governorate following the collapse of ceasefire talks with Turkey. According to a military source in northwestern Syria, the ceasefire talks collapsed after Turkey demanded that the Syrian Arab Army (SAA) withdraw from all the areas they captured in northwestern Hama. The Russian military reportedly rejected Turkey’s demands and restarted their aerial campaign over the Idlib province. | |
Real Personal Spending Growth Ends As Fed’s Favorite Inflation Gauge Heats UpFollowing March’s surprising surge in personal spending, April data was expected to slow (while incomes were expected to accelerate MoM) and did, but both incomes and spending beat expectations. March spending was revised higher to +1.1% MoM (biggest MoM jump since Aug 2009) and April printed a better-than-expected +0.3% MoM. March incomes rose a better-than-expected 0.5% MoM. | |
“If You Weren’t Worried Before, Worry Now”Submitted by Rabobank’s Michael Every If you weren’t worried before, worry now. It hasn’t been China that has been the source of sudden escalation; nor Iran; nor North Korea; nor Turkey, who admittedly gave it a good go in announcing they may install Russian S-400 anti-aircraft missiles in the area of the Mediterranean they are looking for energy in despite protests from the EU’s Cyprus it’s their naval territory; nor even Italy, where Deputy PM Salvini is threatening new elections that would very likely strengthen his hand further has he prepares for battle with Brussels. No, it was Mexico. (Or rather US President Trump, which is less of a surprise.) Don’t get me wrong. Up until this morning I was going to say that it was China you should worry about the most as the May manufacturing PMI slumped to 49.4, and because June was already looking ugly for CNY (as Bloomberg notes today). Moreover, if you listen to recent statements from the White House, and read tweets from a few key US market participants, you could make a strong argument there will soon be US sanctions placed on China over its alleged concentration camps in Xinjiang. (Which readers who have spoken to me personally may recall I have long been suggesting would be a logical–and powerfully disruptive–‘moral’ weapon for the US to use next.) Yet today we are worried most about Mexico because Trump has just tweeted:
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Five Star Capitulates, Will Back Salvini’s Tax-Cut Plan As Rome Denies “Parallel Currency”Like we said earlier this week (and several times in the not-too-distant past), anyone who didn’t anticipate the latest selloff in BTPs and position accordingly has only themselves to blame. | |
First challenge for Sitharaman: Growth at 5-year lowFirst challenge for Sitharaman: Growth at 5-year lowThe economy had grown 6.6% in the third quarter, 7.1% in second and 8.2% in the first quarter. | |
India’s unemployment rate at 45-year highIndia’s unemployment rate at 45-year highThe same figure was leaked to a newspaper in January, which said it was the highest since 1972/73. | |
Will Modi Sarkar 2.0 bite the bullet?Will Modi Sarkar 2.0 bite the bullet?The government now faces tough choices as it tries to put the economy on a higher growth path. | |
Rail Week Ending 25 May 2019: Intuitive Sectors Decline and Remain In ContractionWritten by Steven Hansen Week 21 of 2019 shows same week total rail traffic (from same week one year ago) contracted according to the Association of American Railroads (AAR) traffic data. The economically intuitive sectors rolling averages remain in contraction – and declined. | |
Economic Report: Mortgage rates sink below 4% as the trade war slaps marketsRates for home loans fell again, taking the most popular loan product below a psychological threshold, but Americans’ confidence may be too fragile to take advantage of it. | |
Economic Report: Consumers cut back on spending in April, but rising incomes suggest slowdown might be temporaryAmericans cut back on spending in April after splurging in March, but rising incomes suggest consumers still have plenty of buying power to support the U.S. economy in the face of rising headwinds. Inflation rose, but remained low overall. | |
Need to Know: Stocks to fall 15% to December meltdown levels, this chart predictsThe month of May is set to end with the worst losses for the S&P 500 since the December meltdown. But our chart of the day says investors may need to face up to the index revisiting the lows of that ugly month. |
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