Kamis, 30 Mei 2019

Fears of prolonged trade war weigh on Asia stocks; bonds rally - Investing.com

© Reuters. A man looks on in front of an electronic board showing stock information at a brokerage house in Nanjing © Reuters. A man looks on in front of an electronic board showing stock information at a brokerage house in Nanjing

By Shinichi Saoshiro

TOKYO (Reuters) - Asian stocks tracked Wall Street losses on Thursday as the latest exchanges between Beijing and Washington signaled the heightened risk of a prolonged trade war, stoking investors' concerns about the impact on global economic growth.

European stock futures were higher in early trade, trimming some losses after falling sharply the previous day. The pan-region were up 0.46%, German edge up 0.34% and futures gained 0.25%.

"We oppose a trade war but are not afraid of a trade war. This kind of deliberately provoking trade disputes is naked economic terrorism, economic chauvinism, economic bullying," Chinese Vice Foreign Minister Zhang Hanhui said, when asked about the trade war with the United States.

His comments followed reports from Chinese newspapers that Beijing could use rare earths to strike back at Washington after U.S. President Donald Trump remarked he was "not yet ready" to make a deal with China over trade.

As investors switched out of equities, safe-haven assets such as government bonds found favor, with yields on German benchmark debt approaching record lows.

The fell 0.7% and Hong Kong's lost 0.4%.

Japan's was down 0.5% and Australian stocks shed 0.85%.

MSCI's broadest index of Asia-Pacific shares outside Japan slipped to a fresh four-month low before finding a bit of traction to edge up 0.1%.

"The equity markets are in the midst of pricing in a long-term trade war, with participants shaping their portfolios in anticipation of a protracted conflict," said Soichiro Monji, senior strategist at Sumitomo Mitsui DS Asset Management.

"The upcoming G20 summit could provide the markets with relief, as the United States and China could use the event to begin negotiating again over trade."

The G20 meeting is set for June 28-29 in Japan.

Observers elsewhere expressed less optimism toward the G20 meeting.

"It seems to us that a Trump-Xi meeting on the sidelines of the G20 meeting is more wishful thinking than hard political reality," wrote Marc Chandler, chief market strategist at Bannockburn Global Forex. "This is a moment that defines before and after."

Amid the flight-to-safety, Germany's 10-year bond yield fell to a three-year trough of minus 0.179% overnight. A drop below minus 0.200% set in 2016 would take the yield to a record low.

Spanish and Portuguese 10-year yields fell to record lows as deeply negative German Bund yields have encouraged investors to look elsewhere for returns. [GVD/EUR]

The stood at 2.267% after falling to a 20-month low of 2.210% on Wednesday.

Notwithstanding lower Treasury yields, the against a basket of six major currencies was steady at 98.085 and in reach of a two-year peak of 98.371 set last week, with the greenback serving as a safe haven.

The euro was a shade higher at $1.1137, pulling back slightly following three successive days of losses.

The dollar was little changed at 109.660 yen after bouncing back from a two-week low of 109.150 brushed on Wednesday.

Oil prices rose modestly after an industry report showed a decline in inventories that exceeded analyst expectations.

The rise followed volatile trading on Wednesday, when oil prices fell to near three-month lows at one point as trade war fears gripped the commodity markets.

U.S. crude futures were up 0.66% at $59.20 per barrel after brushing $56.88 the previous day, their lowest since March 12.

added 0.37% to $69.71 per barrel.

Trade worries have weighed on oil but supply constraints linked to the Organization of the Petroleum Exporting Countries' output cuts and political tensions in the Middle East have offered some support.

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https://www.investing.com/news/stock-market-news/fears-of-prolonged-trade-war-weigh-on-asia-stocks-bonds-rally-1882426

2019-05-30 05:43:00Z
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Rabu, 29 Mei 2019

The Bond Market Is Giving Ominous Warnings About the Global Economy - The New York Times

You know the moment in a horror movie when the characters are going about their business as normal and nothing bad has happened to them yet, but it feels as if there are ominous signs everywhere that only you, the viewer, realize?

That’s what watching global financial markets the last couple of weeks has felt like.

In a lot of ways, nothing looks particularly wrong. As of noon Wednesday, the S&P 500 was down about 1.2 percent, falling sharply for the second consecutive session, but over all is down only about 6 percent from its early May high. The unemployment rate is at a five-decade low. With major companies nearly done releasing their first-quarter results, 76 percent had results above expectations.

But along the way, global bond prices have soared, driving interest rates down sharply. Ten-year Treasury bonds are yielding only 2.22 percent as of midday Wednesday, down a full percentage point since November 2018. The outlook for inflation in the years ahead is falling as well, as are the prices of oil and other commodities.

Most significantly, the fall in longer-term bond yields has not been matched by a fall in shorter-term rates. For example, a 30-day Treasury bill is currently yielding 2.35 percent — meaning you can earn more on your money tying it up for a month risk-free than you can tying it up for a full decade.

This is not normal. It is called an inverted yield curve, and historically it has been viewed as a sign of a recession in the offing. At a minimum, it indicates that bond investors believe the Federal Reserve will soon need to cut interest rates — in effect, that they overshot with their four rate increases last year.

And there is a soft underbelly to some of the good economic data of late. Orders for capital goods like business equipment fell 0.9 percent in April, suggesting companies may not be in an expansionary mood. The Institute for Supply Management’s index of activity at manufacturing companies fell sharply in the most recent reading, though it remained in expansion territory.

The financial markets don’t always tell a tidy little story about what is happening, but here’s a theory about reconciling the apparent calm in the economy with the many worrying signs.

The breakdown in trade negotiations with China and the imposition of tariffs on Chinese goods are part of the story, but only a part.

Businesses have weathered escalating tariffs for two years now, and while tariffs can be costly, they do not need to wreck the economy. After all, prices for products fluctuate for all sorts of reasons, and market economies are pretty good at adjusting.

But what has happened in the last few weeks involves the specter of a longer, more painful form of damage. There have been signs that the world’s two largest economies might not simply have tensions and a few tariffs, but could be heading toward a broader split.

In a sense, economists may have been analyzing the trade war too narrowly, merely by calculating the cost of tariffs and where those costs may show up.

The potential long-lasting consequences are harder to model.

What if American regulators try to cut off Chinese companies’ access to Wall Street and its vast pool of financing, as some China hawks are advocating? What if China cuts off exports of the “rare earths” materials that are crucial to advanced manufacturing in the United States? Will the Trump administration’s ban of the technology giant Huawei be the first step toward a bifurcation of today’s global internet into American and Chinese spheres?

Or it could even be this simple: If there is a slowdown in the Chinese economy that causes its demand for oil and other commodities to fall, American makers of those commodities could face pain over and above that caused by tariffs directly. Falling global commodity prices would pull the world economy even further into its deflationary rut.

That last story is particularly consistent with the swings in markets this month. Because tariffs tend to increase consumer prices, you might expect the escalating trade war to cause investors’ expectations for inflation to rise.

Yet the gap in prices between bonds that are indexed to inflation and those that are not suggests that investors envision annual inflation of 1.6 percent over the next five years, down from 1.8 percent at the start of May.

There are further signs of trouble from around the world: threats of conflict with Iran, missile tests in North Korea. European politics is a mess.

It can be a mistake to assume that financial markets are responding to the latest geopolitical headlines. But put it all together, and there seems less of a mystery why bond investors are in a more pessimistic mood than the recent economic and earnings data might suggest makes sense.

It is premature to assume that a recession or a geopolitical crisis is imminent. You could imagine that U.S.-China relations will enter another period of détente, with the Federal Reserve taking a precautionary interest rate cut, and that the economy and markets will once again be off to the races.

In other words, we don’t know yet if this is a horror movie or a comedy, but in the months ahead it seems we’ll find out.

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https://www.nytimes.com/2019/05/29/upshot/the-bond-market-is-giving-ominous-warnings-about-the-global-economy.html

2019-05-29 15:38:53Z
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Canada Goose Stock, Capri Stock, Abercrombie & Fitch Dived On Earnings Reports - Investor's Business Daily

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  1. Canada Goose Stock, Capri Stock, Abercrombie & Fitch Dived On Earnings Reports  Investor's Business Daily
  2. What's moving markets today: Live updates  CNN
  3. Abercrombie & Fitch to close 3 more flagship stores as company shares drop  Fox Business
  4. Abercrombie & Fitch Sinks Following Same-Store Sales Miss  TheStreet.com
  5. Abercrombie & Fitch tanks 23% on weak same-store sales, says 3 big flagship stores to close  CNBC
  6. View full coverage on Google News

https://www.investors.com/news/canada-goose-earnings-canada-goose-stock-capri-earnings-vfc-earnings/

2019-05-29 15:00:00Z
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Huawei asks court to declare US government ban unconstitutional - Engadget

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HECTOR RETAMAL/AFP/Getty Images

Huawei is stepping up its fight against American bans. The tech giant has motioned for a summary judgment in its lawsuit to invalidate Section 889 of the 2019 National Defense Authorization Act, arguing that it violates the "Bill of Attainder, Due Process and Vesting" clauses of the US Constitution. The law explicitly bans Huawei by name despite "no evidence" of a security risk, Huawei's Song Liuping said, and bans third-party contractors who buy from Huawei even when there's no link to the US government.

The company also preemptively tried to dismiss claims that there are facts up for dispute. This is a simple "matter of law," according to lead counsel Glen Nager.

A hearing on the motion is due September 19th.

This won't get Huawei off the Commerce Department's Entities List, which forced US companies to stop doing business with the Chinese firm. It would alleviate some of the pressure on the company, though, and would theoretically provide a route back to doing more business in the US if it's ever removed from the Entities List. It could also push the US to provide evidence (if there is any) to support the measure. If nothing else, it signals that Huawei won't take bans lying down.

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https://www.engadget.com/2019/05/29/huawei-asks-for-summary-judgment-vs-us/

2019-05-29 13:37:20Z
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What's moving markets today: Live updates - CNN

Despite Uber's less-than-impressive performance after going public, one analyst remains optimistic on the company.

Wedbush Securities' Daniel Ives said in a new note that that despite the "negative noise," he remains positive on Uber (UBER).

The company went public earlier this month and is trading 9% below its $45 IPO price

"This week marks an important step forward for Dara & his team to prove to the Street that this business model is still in the early days of playing out," Ives said of Uber's first earnings report, which comes out Thursday.

Ives admitted that it will be a "long and winding road for Uber" to prove its value, he's optimistic the company will successfully expand beyond ride-hailing:

A core tenet of our bull thesis is around Uber's ability to morph its unrivaled ridesharing platform into a broader consumer engine with Uber Eats, Uber Freight, and autonomous initiatives 'just scratching the surface' of the full monetization potential."

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https://www.cnn.com/business/live-news/stock-market-news-today-052919/index.html

2019-05-29 13:28:00Z
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Stocks - Dick's Sporting Goods Rises Premarket; Canada Goose, Boeing Slump - Investing.com

© Reuters.  © Reuters.

Investing.com - Stocks in focus in premarket trading on Wednesday:

• Dick’s Sporting Goods (NYSE:) stock rose 4.3% by 8:15 AM ET (12:15 GMT) after it raised its full-year guidance, even as same-store sales for the first quarter were flat.

• Canada Goose (NYSE:) stock slumped 15% after its revenue for the quarter fell short of estimates, and its forecast guidance failed to meet expectations, according to Briefing.com.

•Capri Holdings (NYSE:) stock fell 7.4% after the luxury fashion company posted weak guidance for the year. The company owns the Michael Kors, Jimmy Choo and Versace brands.

• Abercrombie & Fitch (NYSE:) stock declined 17.2% after it missed estimates for same store sales, even as net sales rose. The company reported a loss per share of $0.29 compared to expectations for a loss of $0.43 per share.

• Boeing (NYSE:) stock dipped 1.1% despite comments that its 737 Max jet could return to the sky as soon as August, according to the International Air Transport Association.

• Bed Bath & Beyond (NASDAQ:) was unmoved after it settled a dispute by activist investors and agreed to nominate four new members to its board of directors.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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https://www.investing.com/news/stock-market-news/stocks---dicks-sporting-goods-rises-premarket-canada-goose-boeing-slump-1881499

2019-05-29 12:15:00Z
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Huawei USA security chief suggests the company could be open to 'mitigation measures' to address US national security concerns - CNBC

The chief security officer at Huawei Technologies USA signaled on CNBC on Wednesday that the Chinese telecom giant might be open to taking steps to address U.S. national security concerns.

"In different countries in the world, we negotiate with respective governments on what kind of assurance framework they need," Huawei's Andy Purty told "Squawk Box." Some measures, he said, might include requirements around selling to government or to critical infrastructure projects. While saying he cannot prejudge any possible conditions, Purdy said he would be "astounded if we weren't open to those kinds of risk mitigation measures. "

Purdy's appearance, along with Huawei outside counsel Glen Nager of Jones Day, comes as the China-based company looks to expedite its March lawsuit against the U.S. government. Huawei, which alleges that a law banning U.S. government agencies from buying its equipment is unconstitutional, is seeking a summary judgment in hopes of avoiding a full-blown trial.

Wednesday's comments from Purdy mirror ones he made about two weeks ago, in which he said a risk-mitigation process for Huawei equipment, like those used in Europe, could have been simple.

The new Huawei filing stems from President Donald Trump's signing last year of a new U.S. defense act that strengthens the Committee on Foreign Investment. However, with the U.S. most recently stepping up pressure against Huawei — as part of trade and technology tensions with China — Trump earlier this month effectively blacklisted Huawei from doing business in the U.S.

Purdy, who formerly served as a top-ranking cybersecurity official for Homeland Security, said U.S. officials have not been "willing to talk" to Huawei. "The geopolitical context between the U.S. and China is why we're in this situation," he said.

Nager said the Trump administration needs to "ramp down the rhetoric," adding that "the U.S. is worried more about the country China than the company Huawei."

Responding to a question about this weekend's Wall Street Journal report with the headline "Huawei's Yearslong Rise Is Littered With Accusations of Theft and Dubious Ethics," Purdy told CNBC, "I don't forgive acts that have happened in the past."

"Despite those, our allies have decided to push back on tremendous pressure from the U.S. government because they believe the national security threats can be addressed," he added.

Huawei has maintained that it adheres to intellectual property rights, which along with national security is at the heart of the U.S. concerns about the company and about business practices in China.

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https://www.cnbc.com/2019/05/29/huawei-usa-security-chief-addresses-us-national-security-concerns.html

2019-05-29 12:57:33Z
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