03Dec2018 Pre-Market Commentary: Wall Street To Pen Sharply Higher On Temporary Trade Detente, DOW Futures Up 450 Points, WTI Crude Higher At 53.60, US Stock Markets Closed On Wed To Honor Bush

Here is the current market situation from CNN Money

European markets are broadly higher today with shares in Germany leading the region. The DAX is up 2.09% while London’s FTSE 100 is up 1.59% and France’s CAC 40 is up 0.86%.

Trump tweets China to cut tax on U.S.-made cars, revs up auto stocks

U.S. President Donald Trump said China had agreed to cut import tariffs on American-made cars, buoying shares in BMW and Daimler AG who manufacture in the United States for export to the world’s biggest auto market.

Trump calls trade truce with China a big step forward

U.S. President Donald Trump on Monday said U.S.-China relations had taken a big step forward over the weekend after he and Chinese President Xi Jinping agreed to hold off on new tariffs, and urged Beijing to finalize a trade deal with Washington.

Futures jump on temporary trade detente

U.S. stock index futures jumped around 2 percent on Monday, set to add to last week’s strong gains, after the United States and China declared a temporary trade truce.

U.S. Trade Representative Lighthizer to lead talks with China: Navarro

U.S. Trade Representative Robert Lighthizer will lead negotiations with China over tariffs, market access and structural changes to intellectual property practices over the next 90 days, White House trade adviser Peter Navarro said on Monday.

Tencent Music presses play on $1.2 billion U.S. IPO

Tencent Music Entertainment launched its hotly-anticipated U.S. initial public offering (IPO) of up to $1.2 billion on Monday after global stock markets were boosted by a truce brokered by U.S. and Chinese leaders in their trade conflict.

Unilever swallows GSK’s Indian Horlicks business for $3.8 billion

Unilever is to buy GlaxoSmithKline’s Horlicks nutrition business for $3.8 billion, boosting the Anglo-Dutch group’s position in India by adding the popular malted drink.

Oil surges 5 percent on trade truce, expected supply cuts

Oil prices jumped by more than 5 percent on Monday after the United States and China agreed to a 90-day truce in a trade dispute, and ahead of a meeting this week of the producer club OPEC that is expected to cut supply.

Qatar to leave OPEC and focus on gas as it takes swipe at Riyadh

Qatar said on Monday it was quitting OPEC from January to focus on its gas ambitions, taking a swipe at the group’s de facto leader Saudi Arabia and marring efforts to show unity before this week’s meeting of exporters to tackle an oil price slide.

GSK to buy cancer drugmaker Tesaro for $5.1 billion

GlaxoSmithKline has agreed to buy U.S. cancer drug specialist Tesaro for $5.1 billion, marking a major biotech investment by the drugmaker as its seeks to rebuild its pharmaceuticals portfolio.

Goldman Pours Cold Water On Trade War Truce: “The Odds Of A Comprehensive Deal In 3 Months Are 20%”

Heading into this weekend’s historic Trump-Xi dinner date, Goldman was skeptical, stating that it was “too soon for a deal” and while it said the odds of a truce were just under 40%, it gave better than even odds of further escalation stating that “it is slightly more likely that the talks end with an optimistic tone but that there is no immediate commitment to delay the step-up in the tariff rate to 25%.” Goldman did hedge, however, saying that “we view this as a reasonably close call.”

And with one look at futures this morning following a summit conclusion that kicked the can on new tariffs and rate hikes by 90 days, it’s a good thing it did (unlike JPM which correctly predicted truce odds were 70%, forecasting that the market’s most likely reaction would be to send the S&P to 2,800 which is precisely where the ES is stuck now).

So what does Goldman think happens next? Perhaps not surprisingly, while the central banker incubating hedge fund tacitly admits its gloomy forecast was misplaced and praises the near-term can-kicking, the bank retains its overall pessimism and in its post-mortem writes that “this outcome is closest to the “pause” sc …

Trump (And Maybe Lighthizer) To Lead Trade Talks As President Praises “Leap Forward” In China Relationship

Update: And the parade of tweets continues, with President Trump praising his “very strong and personal relationship” with Xi and claiming that “he and I are the only two people who can bring about massive and very positive change” on issues ranging from trade to North Korea.

President Xi and I have a very strong and personal relationship. He and I are the only two people that can bring about massive and very positive change, on trade and far beyond, between our two great Nations. A solution for North Korea is a great thing for China and ALL!

— Donald J. Trump (@realDonaldTrump) December 3, 2018

* * *

Markets haven’t even opened yet on Monday and we’re already getting a stream of conflicting reports from Trump administration officials about the upcoming talks with China, as well as what was said during Trump’s meeting with President Xi in Buenos Aires.

As President Trump continues to celebrate his weekend “trade truce”, more details about the negotiations with China set to take place over the next 90 days are beginning to take shape. During an interview on NPR’s “Morning Edition,” White House Advisor Peter Navarro said US Trade Rep. Robert Lighthizer will lead the US delegation during the upcoming talks with China.

White House aide Peter Navarro to @MorningEdition on China trade deal: US Trade Rep. Robert Lighthizer will lead 90 day talks with China. China’s president Xi gave responses to 142 US trade complaints; now they must negotiate them …

US Air Raid Kills Notorious ISIS Executioner; Syria Says Army Positions Hit

The Pentagon has announced US forces in Eastern Syria have killed a key ISIS leader responsible for beheading an American aid worker and former Army Ranger.

“Earlier today, coalition air forces conducted precision strikes against a number of ISIS leaders in southeast Syria. Those targeted included Abu al-Umarayn,” anti-ISIL special presidential envoy Brett McGurk said in a statement late on Sunday. A Pentagon spokesman further confirmed, “Al Umarayn had given indications of posing an imminent threat to coalition forces and he was involved in the killing of American citizen and former US Army Ranger, Peter Kassig.”

ISIS claimed it beheaded Peter Kassig in a video in 2014.

In 2014 Abu al-Umarayn had overseen several executions of westerners captured in Syria, including American aid worker Peter Kassig, who was shown in a “Jihadi John” (or Mohammed Emwazi) execution video. Unlike other ISIS and al-Qaeda execution videos, the beheading itself wasn’t filmed, just the aftermath which included a masked Jihadi John standing over a severed head saying, “This is Peter Edward Kassig, a US citizen.”

Kassig had been abducted on his way t …

Carmaker Shares Surge After Trump Mysteriously Tweets China Will Reverse Auto Tariffs

Long-suffering European auto stocks ripped higher on Monday as they headed for their best session in over two years following a late night tweet from President Trump claiming that China had agreed to lower its punishing 40% tariff on US-made cars. Ironically, shares of German companies like Daimler and BMW outperformed US auto stocks because many of the cars they export to China are manufactured in the US.

“China has agreed to reduce and remove tariffs on cars coming into China from the U.S. Currently the tariff is 40%,” Trump said.

China has agreed to reduce and remove tariffs on cars coming into China from the U.S. Currently the tariff is 40%.

— Donald J. Trump (@realDonaldTrump) December 3, 2018

Adding some confusion to the president’s claim, a top Chinese trade official declined to comment on the Trump tweet during a morning press conference, which failed to dent the upward momentum. Trump tweeted after China and the US agreed to a “temporary” 90-day trade truce where China agreed to buy more US agricultural products to try and help narrow its trade surplus with the US while Trump agreed to suspend a planned increase and expansion for US tariffs.

Market Snapshot: Dow futures up nearly 500 points on trade-war timeout

U.S. stocks are poised to rally Monday after the U.S. and China called a truce to their trade war over the weekend, triggering relief buying of perceived riskier assets such as equities.

London Markets: Resource stocks drive gains in London after U.S., China trade tensions ease

London stocks climb amid global rally driven by an easing of trade tensions between the U.S. and China and climbing oil prices.

Currencies: Dollar softens after U.S.-China cease-fire

The U.S. dollar was weaker on Monday as risk appetite across financial markets increased in the wake of the trade war cease-fire between the U.S. and China, and higher oil prices boosted commodity currencies.