Written by Gary
US producer prices tick up as inflation remains benign (SPY +0.2%). President Trump to sign ‘phase one’ China trade deal, tame inflation pressures could allow the Fed to keep interest rates unchanged this year.
Here is the current market situation from CNN Money | |
 | North and South American markets are mixed. The S&P 500 is higher by 0.40%, while the Bovespa is leading the IPC lower. They are down 0.87% and 0.09% respectively. |
What Is Moving the Markets
| Here are the headlines moving the markets. | |
| Mexico union threatens Home Depot strike, inspired by USMCA trade dealSpurred on by labor protections in the new North American trade deal, a top Mexican trade union has accused Home Depot of blocking union activity and threatened strikes next week if the U.S. home improvement chain does not improve pay and benefits for workers. |
| U.S., China look to reset trade relations with signing of Phase 1 dealU.S. President Donald Trump and Chinese Vice Premier Liu He will sign an initial trade deal on Wednesday that will roll back some tariffs and see China boost purchases of U.S. goods and services, defusing an 18-month conflict between the world’s two largest economies. |
| Stocks hit new peaks on trade deal as oil slips on demand worriesKey world stock market indexes climbed to new records on Wednesday on hopes a U.S.-China trade deal will reduce tensions, but oil prices slid on doubts the pact will spur world growth and boost crude demand. |
| U.S. producer prices tick up as inflation remains benignU.S. producer prices edged up in December as a rise in the cost of goods was offset by weakness in services, the latest indication of tame inflation pressures that could allow the Federal Reserve to keep interest rates unchanged this year. |
| UnitedHealth bets on government health plan growth in 2020UnitedHealth Group Inc , the largest U.S. health insurer, reported a better-than-expected fourth-quarter profit on Wednesday, and said it expects strong sales of its government health plans this year. |
| Oil falls on U.S. gasoline, distillate stock builds, record crude outputOil prices on Wednesday fell about 1% to their lowest in over a month, after a U.S. report showed big increases in gasoline and distillates inventories and as crude production rose to a new record. |
| Pratt & Whitney expects approval for GTF engine on A220 jet in springA software update for the GTF engine on the A220 jet is expected in the spring, pending regulatory approval, Graham Webb, vice president of Pratt & Whitney commercial engine programs said on Wednesday. |
| U.S. judge hears closing arguments in T-Mobile/Sprint merger trialU.S. wireless carriers T-Mobile US Inc and Sprint Corp are expected to urge a federal judge on Wednesday to let them proceed with their $26.5 billion merger, as a group of states argues the deal violates federal antitrust laws. |
| Delta beats profit forecast on strong demand as rivals battle 737 MAX crisis(This Jan. 14 story corrects reference in paragraph 12 to ‘$4.2 billion’ from ‘$4.2 million.’) |
| He Knows You Know That They Know…He Knows You Know That They Know… Authored by Sven Henrich via NorthmanTrader.com, Last week we found out that Dallas Fed president Kaplan knows that the Fed is creating excess and imbalances in stocks. Yes, bloating the Fed’s balance sheet by over $400B  in four months has a massive impact on stock markets. And billions of repo liquidity unleashed each day can be seen impacting the daily action as well (see: Repo Lightning). So what’s Jerome Powell have to say about all this? Silence. Not a word. |
| Trump ‘Broke The Chinese Communist Party’ With Phase One Trade Deal: BannonTrump ‘Broke The Chinese Communist Party’ With Phase One Trade Deal: Bannon Former White House strategist Steve Bannon says that President Trump’s hard-line tactics in the US trade war with China has paid off, telling CNBC’s “Squawk Box” on Wednesday that Trump “stood up for the tariffs and he broke the Chinese Communist Party.” |
| Rickards Warns “Helicopter Money Is No Panacea”Rickards Warns “Helicopter Money Is No Panacea” Authored by James Rickards via DailyReckoning.com, In recent decades, the Fed has engaged in a series of policy interventions and market manipulations that have paradoxically left it more powerful even as those interventions left a trail of crashes, collapses and calamities. This contradiction between Fed omnipotence and Fed incompetence is coming to a head. The economy has been trapped in a prolonged period of subtrend growth. I’ve referred to it in the past as the œnew depression. And the Fed has been powerless to lift the economy out of it. You may think of depression as a continuous decline in GDP. The standard definition of a recession is two or more consecutive quarters of declining GDP and rising unemployment. Since a depression is understood to be something worse then a recession, investors think it must mean an extra-long period of decline. But that is not the definition of depression. The best definition ever offered came from John Maynard Keynes in his 1936 classic, The General Theory of Employment, Interest and Money. Keynes said a depression is, œa chronic condition of subnormal activity for a considerable period without any marked tendency towards recovery or towards complete collapse. Keynes did not refer to declining GDP; he talked about œsubnormal activity. In other words, it’s entirely possible to have growth in a depression. The problem is that the growth is below trend. It is weak growth that does not do the job of providing enough jobs or stayin … |
| Watch Live: Trump Signs Landmark ‘Phase 1’ Chinese Trade PactWatch Live: Trump Signs Landmark ‘Phase 1’ Chinese Trade Pact Update: When you’re president, your thank-you speech can be as long as you want, and nobody will try to shuffle you off-stage by queuing the music. President Trump started his speech by praising the landmark agreement, and highlighting the market’s gangbuster performance since his inauguration (more than 140 stock market ATHs, baby). Then, in typical Trump fashion, he launched into a winding monologue praising Larry Kudlow (for all the times he helped jawbone the market back into the green) and US ambassador to China Terry Branstad (about whom Trump told a story involving the ambassador’s first meeting with President Xi, more than 30 years ago, when he was still a young man). He went on to praise members of the White House staff, and several members of his cabinet – Wilbur Ross, Sonny Perdue and Elaine Chao were each singled out for praise. At one point, Trump addressed lawmakers in the room, offering members of the House the chance to go vote in Nancy Pelosi’s “impeachment hoax”, which she announced earlier. Even Lou Dobbs came in for some praise: Trump praised Dobbs for favorably comparing him to Reagan. Blackstone CEO Steve Schwarzman, former AIG boss Hank Greenberg, and Henry Kissinger also received shout outs from the president. Senators Kevin Cramer, Kevin Crapo, Steve Daines, Joni Earnst, Lindsey Graham and several others also got shouted out. He’s still going, as the market gradually ticks higher. Trump even shouted out JPM, praising the company for yesterday’s blockbuster earnings … |
| India is planning a new law to safeguard foreign investmentIndia is planning a new law to safeguard foreign investmentIndia plans to attract more capital from overseas to boost stuttering domestic growth by this move. |
| ‘Apple of China’ is creating jobs in India‘Apple of China’ is creating jobs in IndiaXiaomi in a press statement said that it generated employment for 50,000 people in India. |
| Soon, switch on, off your debit & credit cardsSoon, switch on, off your debit & credit cardsBanks have been asked to give users the facility to enable/disable their cards for different types of use. |
| January 2020 Empire State Manufacturing Index Marginally ImprovedWritten by Steven Hansen
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| The Margin: The simple secret to living a longer and healthier life: Don’t be poorNewsflash: Being wealthy has its benefits. And it goes well beyond fancy cars and McMansions. In fact, according to a study published by the Journal of Gerontology this week, longer, healthier lives await those who can afford them. |
| Elon Musk stands to get even richer if Tesla’s market cap tops $100 billionTesla Inc. Chief Executive Elon Musk may do another dance if the electric car maker’s stock rises a few more percent and stays there a while, as he stands to receive stock options that could be worth hundreds of millions of dollars. |
| Bernie Sanders says 500,000 people a year declare bankruptcy over medical expenses ” here’s how to avoid that fateMillions of Americans are grappling with medical debt, researchers say. |
The Empire State Manufacturing Survey index marginally improved. Overall this survey remains below values seen in the last 2+ years.Earnings Summary for Today
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