04Sep2019 Pre-Market Commentary: Wall Streets Equity Futures Have Rebounded From Yesterday’s Decline, DOW Futures Up 233 Points, US Dollar Slips To 98.60, Gold Trading At 1539

Here is the current market situation from CNN Money

European markets are broadly higher today with shares in France leading the region. The CAC 40 is up 1.18% while Germany’s DAX is up 1.09% and London’s FTSE 100 is up 0.38%.

American Eagle third-quarter profit forecast disappoints, shares fall

Apparel retailer American Eagle Outfitters Inc forecast third-quarter profit below estimates on Wednesday after reporting disappointing quarterly same-store sales due to weak performance in certain seasonal clothing lines.

Oil prices rise over 1 percent, but economic worries loom

Oil prices rose on Wednesday, boosted by a wider market pickup on positive news from China’s services sector, after three days of losses due to fears about a weakening global economy.

WeWork adds woman to its board after backlash ahead of IPO

WeWork owner, The We Company, said on Wednesday it will add a woman, Frances Frei, to its board of directors and unwound a $5.9 million (4.8 million) payment to its chief executive for use of the trademarked word “We” ahead of a planned initial public offering.

Emirates’ Clark says won’t take new planes unless engines are truly ready

Emirates President Tim Clark said engine makers Rolls-Royce and GE must improve their reliability, saying the airline would not take new Airbus and Boeing planes unless they were truly ready.

Stock futures higher as robust Chinese data eases growth worries

U.S. stock index futures rose on Wednesday after encouraging data from China allayed concerns of slowing global growth in the backdrop of an ongoing trade dispute between the United States and China.

Malaysia defends move to extend license for rare earth firm Lynas

Malaysia’s government said on Wednesday its decision last month to extend a license for Australia’s Lynas Corp for processing rare earth minerals aimed to show investors that the Southeast Asian nation was open for business and preserve 600 jobs.

Cathay Chairman Slosar resigns weeks after CEO left, deepening reshuffle

Hong Kong’s Cathay Pacific Airways shook up its top ranks further as Chairman John Slosar resigned on Wednesday, less than three weeks after mounting Chinese regulatory scrutiny led to the shock departure of its chief executive.

To cut or not? Dueling Fed views boost pressure on Powell

The Federal Reserve should use its meeting in two weeks to aggressively cut interest rates, one U.S. central banker said on Tuesday.

U.S. effort to disqualify Huawei’s lead lawyer goes to court

A former U.S. Justice Department official who now represents Huawei Technologies is expected in Brooklyn federal court on Wednesday to defend his right to represent the Chinese company against U.S. charges of bank fraud and sanctions violations.

Modern Monetary Theory (MMT) Proponents Have A Big Argentina Problem

Via Global Macro Monitor,

Proponents of Modern Monetary Theory emphasize that a country that controls its own currency and borrows in its own currency, like the United States, cannot default on its debt. This is because the central bank can, if necessary, œprint the money needed to pay the government’s creditors ¦Â - Econofact

The MMT crowd has some ‘splaining to do after Argentina’s default on local currency Treasury Bills (Lecaps) last week.

We have argued for years with our MMT friends about the dubious assumptions and logic that Modern Monetary Theory is built, most importantly, that a sovereign borrower with an independent central bank and currency, by definition, cannot default.  Though the debate has evolved over the years to now what is the true definition of œfull monetary sovereignty, a free floating exchange rate is a big assumption, for example, it would always come down to the case of the 1998 Russian default on ruble Treasury bills known as GKOs.  to which the MMT crowd would retort, œspecial case.  Ironically, the Russians paid their hard currency Eurobonds and defaulted on local currency debt, the complete opposite of what MMT concludes.

Argentina could have monetized the Lecaps last week and let the peso float and collapse as the maturing peso debt would have immediately been converted to dollars. Â The government chose not to.

We would try to explain to our friends that when a sovereign borrower gets into trouble and experiences œrollover risk and cannot refinance maturing debt due …

UK Braces For Exodus Of Richest Taxpayers If Corbyn Becomes Next PM

As Prime Minister Boris Johnson faces the prospect of his rule being cut short, wealthy Britons have a message for Johnson’s most likely successor: A ‘no deal’ Brexit makes no difference to them. But if Labour leader Jeremy Corbyn becomes PM, they will flee in droves, taking their money with them.

Johnson faces a new battle in the Commons after his first vote as PM saw him lose to rebel Tories and opposition MPs who object to a no-deal Brexit. Rebels voted 328-301 to take control of the agenda, allowing them to bring forward a bill requesting a Brexit delay.

Global Markets Soar As Tensions Ease From Hong Kong To Italy And London

Just one day after stocks tumbled on concerns of an imminent economic recession when the US Manufacturing ISM tumbled below 50 for the first time in 3 years, all fears appeared to evaporate this morning as U.S. stock-index futures surged, erasing almost all of yesterday’s losses, boosted by hopes of a return to calm in Hong Kong combined with political developments in Italy and the U.K. S&P futures surged as much as 1% after news that Hong Kong’s chief executive plans to formally withdraw the extradition bill that had sparked widespread protests.

Stocks got a further boost out of the latest development in Italy, where the FTSE MIB Index was the best performer among local European markets, up 1.7%, after Giuseppe Conte cleared the last hurdle to become prime minister, when he got backing from supporters of the Five Star Movement in an online vote. Finally, the no-deal Brexit storm appears to be passing as lawmakers in the U.K. supported moves to block Prime Minister Boris Johnson from taking the nation out of the European Union without a deal.

As a result, global stocks rose 0.4%, as Europe rallied 1.1% and after a positive session in Asia following a report showing that growth in China’s service sector accelerated despite broader economic headwinds.

Pound Surges As BoJo Prepares To Trigger Snap Elections

After last night’s humiliating defeat, Prime Minister Boris Johnson is preparing for the next step in his battle to take the UK out of the EU with or without a deal. And that is: moving to trigger a snap general election that will leave everything – including his future as PM – up to chance, according to BBG.

The pound extended its gains and rose more than 1% on the news, as short-term names unwound shorts to trigger stops, while the British currency also benefited from broad-based dollar weakness.

GBP/USD gained as much as 1.2% to trade at 1.2220, remaining near the day’s highs as the market priced in lower chances of a no-deal Brexit on Oct. 31; U.K. 10-year gilt yields climbed 9bps to 0.49%.

45% of equity MFs underperform their benchmarks in 5 years

45% of equity MFs underperform their benchmarks in 5 yearsThe value-oriented category was the worst performer, with 67% schemes underperforming their benchmark.

A pain point for infra cos could solve soon

A pain point for infra cos could solve soonNHAI alone is to clear claims of over Rs 50,000 crore to road developers, despite losing cases in arbitration.

US firms in China are setting eyes on India

US firms in China are setting eyes on IndiaUSISPF president Mukesh Aghi said about 200 US companies were keen to relocate to India from China.

Economic Report: U.S. trade deficit falls 2.7% in July, but the gap is still huge and unlikely to shrink

The U.S. trade deficit fell 2.7% in July owing to higher exports of drugs, oil and autos, but the gap was still running ahead of last year’s pace even as the Trump administration adopted tough tactics to reverse the tide. The deficit slipped to $54 billion.

Tax Guy: Sorting out a loved one’s estate is more work than you think ” how to simplify the process

You’ll be responsible for paying debts and taxes.

Market Snapshot: U.S. stocks poised to bounce higher as Hong Kong, other political tensions seen easing

U.S. stocks look set to rebound on Wednesday as investors shake off weak data from a day ago and focused on signs of easing tensions in Hong Kong and the retrenchment of a host of other anxiety-inducing political problems.