Written by Econintersect
Early Bird Headlines 02 March 2018
Econintersect: Here are some of the headlines we found to help you start your day. For more headlines see our afternoon feature for GEI members, What We Read Today, published Monday, Wednesday and Friday, which has many more headlines and a number of article discussions to keep you abreast of what we have found interesting.
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​Global
- Asian markets sell off after Trump’s tariff announcement; Nikkei leads losses (CNBC) Asian stocks closed lower on Friday, with steel producers and automaker names recording steep drops. The fall in regional markets tracked sharp losses on Wall Street following a tariff announcement from U.S. President Donald Trump. The dollar index edged lower to trade at 90.189 by 2:45 p.m. HK/SIN. U.S. West Texas Intermediate (WTI) crude was down $0.01 at $60.98 by 0432 GMT. Global benchmark Brent was up $0.07, or 0.1%, at $63.90 a barrel. Spot gold had risen by 0.1% to $1,316.84 an ounce by 0412 GMT.
U.S.
- Trump says U.S. to impose steep tariffs on steel, aluminum imports (Reuters) See also Trump Roars, China Yawns, U.S. Shoots Itself in the Foot (Bloomberg). President Donald Trump announced on Thursday he would impose hefty tariffs on imported steel and aluminum to protect U.S. producers, risking retaliation from major trade partners like China, Europe and neighboring Canada as well as helping to trigger a large selloff on Wall Street. Trump said the duties of 25% on steel and 10% on aluminum would be formally announced next week although White House officials later said some details still needed to be ironed out.
Trump believes the tariffs will safeguard American jobs but many economists say the impact of price increases for consumers of steel and aluminum, such as the auto and oil industries, will be to destroy more jobs than they create.
- Stocks Sink, Bonds Rally on Trump’s Metals Duties: Markets Wrap (Bloomberg) Markets were hit hard by the president’s announcement.
Stocks
- The S&P 500 fell 1.4 percent to 2,677.28.
- The Dow Jones Industrial Average dropped 1.7 percent, or 427 points, to 24,597.83.
- The Stoxx Europe 600 slid 1.3 percent.
- The MSCI All-Country World Index declined 1 percent.
Currencies
- The Bloomberg Dollar Spot Index slipped 0.3 percent.
- The euro added 0.6 percent to $1.2264.
- The British pound gained 0.1 percent to $1.3773.
Bonds
- The yield on 10-year Treasuries declined five basis points to 2.81 percent.
- Germany’s 10-year yield retreated one basis point to 0.64 percent, the lowest in five weeks.
- Britain’s 10-year yield lost three basis points to 1.47 percent, the lowest in a month.
Commodities
- West Texas Intermediate crude decreased 0.4 percent to $61.38 a barrel.
- Gold declined 0.2 percent to $1,315.57 an ounce, the lowest in seven weeks.
- Tariff Deja Vu ‘All Over Again’ (Twitter)
- Countries are widely expected to respond with countermeasures to Washington’s proposed tariffs on foreign steel and aluminum imports
- A look at U.S. exports to at-risk nations could provide a sense of how the international community may retaliate.
- If the administration applies its tariffs to all steel and aluminum exports – as opposed to cherry-picking countries to punish – there are five nations that will suffer the most. Brazil, Canada and South Korea were the three largest suppliers of steel to the U.S. last year, according to data from IHS. Canada, Russia and the U.A.E. were the three largest suppliers of aluminum in 2016.
- ‘Bomb Cyclone’ Will Pummel Parts of the US East Coast Starting Tonight (Live Science) See also Dangerous Nor’easter Wallops East Coast With Wind, Snow and Rain (The New York Times). An area of low pressure currently brewing in the Atlantic off the U.S. East Coast is expected to quickly develop into a powerful nor’easter – an intense storm moving from the Northeast – beginning tonight (March 1) and lasting well into Friday (March 2), the National Weather Service (NWS) reported earlyThursday morning. The major storm will bring high winds, flooding, and heavy rains and snow, affecting coastal states from Maine to Virginia, according to the NWS.
This type of fast-forming storm is known as a “bomb cyclone” for the process that shapes it, called “bombogenesis.” This process causes the storm’s central low pressure to plummet by at least 24 millibars (a measurement of atmospheric pressure) in 24 hours, according to the National Oceanic and Atmospheric Administration (NOAA). The pressure of this particular bomb cyclone is expected to drop by about 30 to 35 millibars in 24 hours
- People with pre-existing conditions could face tough times ahead (CNN) President Donald Trump and his administration are taking steps to lower premiums, increase choice and foster competition in the health insurance market. All of that sounds good — until one realizes that the changes are coming largely at the expense of millions of Americans with pre-existing conditions. The administration has issued two proposed rules in recent months that will allow more people to sign up for alternatives to Obamacare. But the actions are expected to mainly help younger and healthier consumers, while hurting those with spottier health histories.
That’s because the proposed regulations, combined with Congress’ elimination of the individual mandate next year, will whittle away at Obamacare’s sweeping protections for those with pre-existing conditions. This will leave those who are or who have been sick at risk of paying higher premiums, losing their comprehensive coverage or being left without an insurer on the Affordable Care Act exchanges.
If the proposed rule is finalized in coming weeks, premiums for Obamacare policies would rise 3.5% to an average of $15,000 a year, largely because healthier enrollees would opt for association plans, according to a new study by Avalere Health, a consulting firm. Those buying the new small business plans would pay $5,300, on average.
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- Jobless Claims: Ludicrous Mode (Bespoke) In this week’s report, first-time claims came in at 210K, which was 15K below the consensus estimate of 225K. The last time a weekly print came in that low was in 1969 when the labor force was less than half what it is today! It has now been seven straight weeks that jobless claims have come in below 250K and 156 straight weeks that they have been below 300K. Barring a 90K increase in the next few weeks, the current streak of sub-300K readings will go down as the longest ever.
EU
- Reuters poll – Euro zone economic growth momentum has peaked, say economists (Reuters) Euro zone economic momentum has peaked, according to a majority of economists in a Reuters poll who also said the European Central Bank will drop its easing bias on stimulus by or at the June meeting. The region’s economic performance has been robust and in 2017, gross domestic product rose 2.5%, the fastest growth rate since a 3.0% rise in 2007.
More than 70 percent of 51 economists who answered a separate question said the peak of growth momentum in the euro zone was now in the rear-view mirror.
UK
- Siberian blizzards blast Britain and Ireland as Storm Emma approaches (Reuters) Snow storms from Siberia blasted Britain and Ireland on Thursday with the worst weather since 1991, trapping several hundred motorists on roads in Scotland, closing thousands of schools, grounding planes and halting trains. With up to 90 cm (35 inches) of snow and temperatures as low as minus 10.3 Celsius (+13 degrees F) in Scotland, Britain and Ireland issued their most severe red warnings which advise people to stay at home as travel is too dangerous. The worst is yet to come for southern England and Ireland as Storm Emma approaches from Portugal and France.
Germany​
- German steel industry urges EU to fight U.S. import tariffs (Reuters) U.S. President Donald Trump’s decision to impose import tariffs on steel violates the rules of the World Trade Organization, the German Steel Association said on Thursday. Steel Association President Hans Juergen Kerkhoff said:
“The U.S. is setting up a customs barrier to protect itself from steel imports from all over the world. This measure clearly violates the rules of the World Trade Organization. Now the EU must resolutely proceed against this with the instruments the WTO provides.”
India
- India is growing faster than China again (CNN) Growth accelerated in the quarter ended December to 7.2%, the government said Wednesday. That’s faster than China’s growth over the same period, and a big jump from the 6.5% India recorded the previous quarter. The latest GDP numbers point to a clear strengthening of India’s recovery from a sharp slump in the first half of 2017, when growth fell from 7% to a three-year low of 5.7% after two disruptive policy changes by Prime Minister Narendra Modi.
China
- China could target US soybeans in a trade dispute, but Beijing is holding off for now (CNBC) Beijing could target soybeans to retaliate against any punitive trade action from the U.S., but it’s unlikely to do that just to counter heavy U.S. tariffs on steel and aluminum, experts said.
Mexico
- Mexican Election Coverage (Bloomberg) The leftist Morena party candidate Andrés Manuel López Obrador has a significant lead in polling, but does not appear to have enough support to win the election. If he does not get a majority there will be a runoff between the top two candidates. Ricardo Anaya of the conservative National Action Party (PAN) has a comfortable lead over the third place candidate José Antonio Meade of the Institutional Revolutionary Party (PRI) of outgoing president Enrique Peña Nieto. See also Mexico is a democracy, but the ghosts of one-party rule live on (The Washington Post)
