The Day Today 2nd December 2019

– US/China phase one trade deal “optimism now seems premature, if not misplaced” but the US will hold off on implementation of December 15th tariffs reports website Axios
– China Caixin/Markit PMI rose 51.8 vs expected 51.5 giving its strongest reading since December 2016
– Germany apologised to Draghi about so much overt criticism of the ECB in an effort to smooth things over with the ECB especially as Lagarde has now taken over and made her first two speeches in Germany
– German government coalition now looks shakey after the SPD’s new leadership are critics of Merkel’s policies and are much more left wing than previous incumbents
– Fed may allow inflation to run hot, i.e. above their 2% inflation target, in a new so-called “make-up strategy”
– UK election: ITV ‘leaders’ debate saw neither Corbyn nor Johnson take part, those there clashed over Brexit, the NHS, terror legislation; Johnson interview with Marr fact checked; Lib Dems will not support Labour’s nationalisation plans

Despite declines on the last day of trading in light trading after Thanksgiving, in November the S&P 500 gained 3.4%. Asian equity markets started off strongly in December after strong Chinese data
Today sees Lagarde 2pm, US ISM 3pm

Latest Premium Insights:

  • Germany: Minority Government?; SPD new leaders, fiscal largesse is their mantra, Merkel won’t be happy, she may be forced to go for a minority government
  • The Economist: Finance and economics articles summarised: WTO will not be able to hear new cases after December 10th as two of the three judges retire; China is starting to own up to their debt problem; election/economic cycle relationship has broken down in favour of identity and culture issues
  • The Week That Will Be; UK politics is unstable but Bojo is still well favoured to win a majority however the Conservative party won’t like to see momentum turning against them; RBA might stay on hold (Tues) only because they’re running out of bullets; Lagarde (Mon 2pm); BOC (Wed 3pm)

On this day in 1804 Napoleon Bonaparte crowned himself Emperor of the French in Notre Dame Cathedral

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