The Trump administration extended Monday by 90 days the derogations that allow American companies to continue to deal with Huawei Technologies. This raised optimism among investors, despite the absence of concrete progress in the trade talks between China and the US.
With such a good performance from indices, there are undoubtedly many financiers who would do without the last weeks of the 2019 vintage. After all, the S&P500 has gained more than 24% since January 1 and stands on its historical records, like many other indices. And then a major hazard persists, since China and the United States have still not agreed on the terms of their trade. The two powers have been less active in the media recently, which investors seem to consider as a positive sign: delegations are working in the background. From there to reach a basic compromise by the end of the year? This remains the basic premise.
Meanwhile, Donald Trump is still facing the parliamentary inquiry regarding his alleged mixing of personal and political interests. Nevertheless, he found time to welcome his best enemy, Federal Reserve boss Jerome Powell, to the White House yesterday. Trump continued his criticism of monetary policy in general and excessively high rates in particular, but described the interview as "good" and "cordial". Everything was mentioned, including interest rates, negative interest rates, low inflation, easing, the strength of the dollar & its effect on industry, trade with China, the EU & others, according to POTUS.
Meanwhile, on the Brexit front, British television channel ITV will broadcast the debate between the two leaders Jeremy Corbyn and Boris Johnson later today, in preparation for the elections to be held on December 12. Each will have one minute for their opening speech and 45 seconds for their closing speech. Questions will be asked by ITV viewers from various political backgrounds but also from society as a whole. The main topic will of course be Brexit, but economic promises will also be on the agenda, as everyone has proposals to make. In Hong Kong, schools remain closed for the sixth consecutive day, as well as a major tunnel linking Kowloon to Hong Kong Island. The demonstrators set fire to police vehicles, which had warned that they would now use live ammunition to stop the riots.
Another interesting info concerns Norway. After reaching a valuation of more than $1 trillion last month, the sovereign wealth fund continues to see an increasing increase in demand from investors, who are inquiring about the possibility of withdrawing their share. The purpose of the fund is to ensure that Norway continues to benefit from its oil wealth and is expected to benefit future generations. In any case, this is what the representatives of the Norwegian Central Bank are trying to clarify: the SWF belongs to the Norwegians but they cannot make withdrawals.
Today's economic highlights include two events to follow today, the monthly figures for US building permits and housing starts and a speech by New York Fed boss John Williams.