Global bourses edged higher this Friday morning as traders digested optimistic statements out of the White House of a prospective trade deal between the U.S. and China. Meanwhile, other sources continue to highlight that the trade talks are at a stillstand with an FT report mentioning that “Trump officials are frustrated that China has not offered enough concessions to justify a reduction in US tariffs on Chinese goods.” and  that the Chinese side was “jeopardizing the chances that a final agreement could be reached in coming days.”

 

Bourses Edge Higher

The German DAX traded higher following suit with US stock markets, yet news of Daimler stating they are stopping any investment into business development and are looking to lay off a lot of their workers should not be taken positively and as a result, Daimler's market cap fell below Tesla's!

 

Mixed Comments on the US/China Front Keep Investors on Edge

Larry Kudlow, the White House economic adviser, claimed on Thursday that phase one of the trade deal was “getting close,”. The markets responded by turning higher this morning even though the Chinese Ministry of Commerce spokesman Gao Feng continued Beijing’s call for a removal of existing tariffs, something that the U.S. has repeatedly refused to do. Stock markets turned further up and even Walmart reported better earnings than expected despite tariffs which was quite surprising but lifted the mood on stock markets significantly and led to new ATH levels.

 

Yields Tumble on Powell Speech

Jay Powell went on for the second day of his testimony which resulted mainly in US yields tumbling again, as his statements likely build on the negative outlook for a quick agreement between US and China and expecting the Fed not to ease any further from here based on statements of Powell that “the US economy offers a sustainable picture”. 

 

Forex Preview: USD Loses Steam

The USD is trading slightly weaker on yields turning lower which could offer interesting re-entries in for example the AUD that has now shown the odds of a new rate cut in early 2020 went up to 70%. The EUR regained the 1.10 level on optimism that Germany did NOT fall into a recession. Is this enough however to turn the tide? Personally, I do not believe so.

EURUSD

 

Oil Prices Recover, Gold Dips. BTC at 8.7K

Oil moved once more above the $57 but came back down on builds on the stocks meaning supply is bigger than demand at the moment. Meanwhile, the US-China Outlook or soft Chinese economic data is not helping oil prices to move decisively higher.  Gold prices fell on increased risk appetite and after Fed president Powell's comments of a good economy. Meanwhile, the BTC broke through the 200-day-MA to the downside now clearly putting bears in control 

 

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