US considers to cut some China tariffs

The US is condidering to cut Chinese tariffs in order to boost the negotiations further.

The US President Donald Trump and China’s Xi Jinping are expected to enter the deal discussion after the cancelled Apec meeting in Chile.

The news helped stock markets to enter new hights in New York. For example Nasdaq- index and Dow Jones closed record high on Tuesday trading.

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Fed cuts rates due to weak investments

The US Federal Reserve has today cut the key interest rates so that the new target range for Fed Funds is between 1,5 – 1,75 %.

According to the Central Bank, the main reason for the rate cut has been the weak investment and export development.

This was the third rate cut this year after the cuts in July and September. According to Wall Street Journal, the expectations for December rate cut is about 20 %.

8 of the 10 Central bankers agreed to lower the rates, while 2 Feds wanted to hold the rates steady.

According to Wednesday data, the US gross domestic product grew 1,9 % during the third quarter.

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Trump considers to ban Chinese listings on the US?

The US President Donald Trump is considering to ban the new listings on US exchanges and also to hinder the US pension funds to make investments in Chinese equities. The news send the US stock markets down while it is a sign of new tensions between the US and China trade talks, which should begin again in October.

The news about the topic and content were mixed in different media sources. For example according to Financial Times the sanctions would mean listings and financial investments between the countries. On the other hand, according to Reuters it was about how the Chinese companies could be delisted from the US markets.

The real content of the idea will maybe revealed later on, but the fact is that both ways would mean a dramatic change in the financial markets and its global functions. And some one could also consider if it would be possible anyhow. The financial markets regulations is not one-way street, but rather a highway or even a crossroad of high speed trains.

Big Chinese companies like Alibaba Group Holdings and JD.com both declined over 5 % after the news in New York. According to Reuters, there are 156 Chinese companies listed in Nasdaq and NYSE.

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Trump: China is willing to make a deal

The US President Donald Trump said to media representatives that he believes China is willing to make a trade deal. He told media that if the trade war is to prolonged the US will benefit more from it. He was speaking in Morristown before boarding Air Force One on Thursday.

According to Wall Street Journal, President Trump has also asked White House advisers to analyse if the Danish owned Greenland would be for sale. The idea of buying the Danish governed island would be in the national security interest, while one of the US Air bases is located on the island.

The speculation of the idea has come into public while Mr Trump will be visiting Denmark during September. None of the parties have responded to a request for comment, the newspaper says.

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Tech stocks up in Wall Street – RealReal +12 %

The tech stocks soared up in Tuesday trading in New York. Apple´s (AAPL) stock closed up 4,23 % to 208,97 dollars due to the tariffs delays in the US China trade negotiations. Also retail gained and for example Amazon (AMZN) closed up 2,21 % to 1824 dollars. The tariffs delay is expected to help the Christmas shopping as well.

The re-used luxury online shop RealReal gained over 12 % in trading. The company published its second quarterly figures ending June 30th. According to the press release the total revenue gained 51 % to 71 million dollars from a year earlier and the average order value was 452 dollars. The net loss was 26,8 million dollars compared to the loss of 17,6 million dollars a year ago. The company had the IPO in the beginning of July.

Tesla (TSLA) was also up, 2,62 % to 235 dollars and Ralph Lauren (RL) also up 1,61 % to 93,41 dollars. The retail company Macy´s was also up, 0,41 % to 19,36 dollars. The company is to publish its figures on Wednesday.

Dow Jones- index closed up 1,44 % to 26 279 points, the large S&P 500 -index closed up 1,48 % to 2926 points and tech-index Nasdaq closed 1,95 % to 8016 points. Semiconductor sector index closed up 2,95 % to 1489 points.

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Stocks closed down in NY- US data and trade tariffs

The US equities closed down today due to weak consumer confidence data and the trade tariffs between the US and China. The US and China leaders are meeting this week in G20 meeting in Japan and the information from the Federal Reserve has been that the tariffs can increase the risk of slower growth globally if there is no more confidence in the markets.

Dow Jones closed down 0,67 % to 26 549 points, S&P 500 index down 0,95 % to 2917 points and Nasdaq down 1,51 % to 7884 points. In Europe the FTSE 100 -index closed up 0,08 % to 7422 points, while the equities on the continent were down. In Germany the DAX closed down 0,38 % to 12 228 points and in France the CAC 40 down 0,13 points to 5514 points.

The US consumer confidence and new home sales were both below markets expectations. On the other hand on the M&A side, the deal volumes and values have been record high, according to Bloomberg data. On Tuesday, AbbVie said it would buy Allergan company, the Botox maker, for 63 billion dollars.

The G20 meeting on Friday and Saturday in Osaka, Japan will give more information while the US President Donald Trump and the Chinese President Xi Jinping will have their discussions then. According to Bloomberg, the US officials have signalled that the trade deal is unlikely to happen.

The US markets have been pricing a 50 basis points rate cut for the next Federal Reserve meeting in July, but according to St.Lous Fed President James Bullard such a rate cut would be too much. He commented the situation in a Bloomberg interview.

The central bankers have been discussing about the cryptocurrencies and Facebook´s new Libra coin in the central banks meeting in Switzerland today. The question of financial stability, consumer and regulatory standpoint are the major issues for the tech company and some believe Libra is not going to be a Bitcoin.

According to Reuters, the Facebook other issues related to privacy concerns and hate speeches have been the major topics and central bankers are requiring more information from Facebook in order to proceed with the new currency. The Britain’s Financial Conduct Authority (FCA) also commented the issue today with the same tone of voice.

In London, the discussions about the Brexit deal and the new Prime Minister have continued. Boris Johnson or Jeremy Hunt will be the next Prime Minister for the UK and the new leader will be announced on the 23rd of July. The deadline, October 31st will be soon, while the UK Parliament is starting their summer holidays on July 25 and the MPs will return on the September 3rd.

The euro was trading slightly up 0,01 % to 1,1368 dollars and the sterling up 0,06 % to 1,2696 dollars.

In Asia, the stocks were also down, the Shanghai All ended down 0,87 % to 2982 points, the Hang Seng in Hong Kong down 1,15 % to 28185 points and the Nikkei-index in Japan down 0,43 % to 21 193 points.

 

 

 

 

 

 

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