MARKET OUTLOOK - Global & Local, Perspectives & General Market Feeling

[early birds]

Trump Considers 60-Day Extension for China Tariff Deadline

https://www.bloomberg.com/asia

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can anyone trust Trumpy these days????

market seems muted for the news atm. priced in already??

[early birds]

https://www.afr.com/markets/equity-markets/...20190212-h1b4zg

Yardeni Research said it expects a trade deal between the US and China by the end of this month.

"The Chinese need a deal badly to placate Trump's demands for fairer trade so that he won't impose another round of tariffs on US imports from China. One tipoff is that the Chinese could have responded to US criminal charges against Huawei by walking away from the talks, but they didn't do so."

Overnight the latest UK economic data reflected the increasing uncertainty of Brexit. The UK economy decelerated faster than expected in the final three months of 2018. There are concerns that consumer sentiment will deteriorate the longer it takes for a clearer outlook on Brexit to appear and that business investment will continue to falter too.

Pantheon Macroeconomics' Samuel Tombs sounded a more optimistic note in his comment.

"All told, Brexit uncertainty clearly is slowing the economy, but we do not see a strong case for expecting GDP to fall in Q1," Mr Tombs said. "We have revised down our forecast for quarter-on-quarter GDP growth in Q1 to 0.2%, from 0.3%, due to the lower-than-expected starting point in December.

"We also have nudged own our forecast for year-over-year GDP growth in 2019 as a whole to 1.5%, from 1.6%. But we're not prepared to bet against consumers at this stage, given their track record of resilience and myopia."

As expected, the spot price of iron ore leapt higher on Monday as it reset with the return of Chinese traders. The surge in iron ore prices has led Citigroup to significantly lift its earnings forecasts for BHP, Rio and Fortescue. It has buy ratings on both BHP and Rio; and a hold on FMG.
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uncertainty ----is the word for current market condition.

[blacksheep]

Of course, should there be any leaks re the Banking Royal Commission during the course of Monday - before the report is made public after the close of the market - you can probably discount any of the comments below regarding a positive start. Leaks back in 2017, before the announcement of the multi-billion banking levy, which were included in the Federal Budget, wiped $14 bil off the banks SP
https://www.news.com.au/finance/economy/fed...0b9d023022e0a0c

Australia's share market is tipped to open positively but the release of the financial services royal commission report is likely to impact trade throughout the week.

The positive start has been attributed to favourable company earnings and employment in the United States as well as a rise in oil prices in Australia, CommSec chief economist Craig James said.

"A lot of support from our market is coming from the resource sector," Mr James said.

Mr Hayne's report is expected to contain recommendations that will have a recognisable impact on the banking and financial sector, including lending practices.

"There will be a fair bit of caution from investors before the statement comes out ... it will influence trade over Tuesday and the remainder of the week," Mr James said.

https://www.smh.com.au/business/markets/ban...203-p50veo.html

[blacksheep]

The growing problem that could lead the world into a new kind of financial crisis
extract

However, Mark Carney, the Governor of the Bank of England, says that it is an open question how robust a system in which most of the assets are held by fund managers rather than banks will be to an economic shock.

"The good news is that exposure [to debt defaults] doesn't jump to the core of the financial system but there could be some surprises in terms of pricing that could lead to bigger overshoots," Carney said on a panel in Davos.

What this means is that a lack of liquidity in the market could result in lots of investors trying to rush out of a very small door. And this could turn a correction in the markets into a crash.

The working assumption, therefore, is that investors could lose a lot of money but no banks will go bust and the financial system won't be brought to its knees. But, as Carney said, no one really knows. Might a crash in the price of assets banks don't hold lead to a crash in the price of the assets that they do?

"What we worry about is if you extrapolate [these trends] potentially this risk comes closer to the core of the system," said Carney.

"Just because it hasn't happened doesn't mean it won't happen."

Might the Davos cognoscenti have erred again?

read more https://www.smh.com.au/business/the-economy...128-p50u0l.html

[blacksheep]

Theresa May's government could declare a state of emergency and introduce martial law under a no-deal Brexit
THOMAS COLSON
JAN 27, 2019

The government is reportedly considering introducing martial law and declaring a state of emergency if the UK leaves the EU without a deal.
There is growing concern that a no-deal Brexit could lead to civil unrest.
3,500 British troops have already been put on standby to cope with a possible no-deal EU exit.

Read more at https://www.businessinsider.com/uk-could-de...yD6eEZT0EBU0.99

[plastic]

Donald J. Trump‏Verified account @realDonaldTrump 2m2 minutes ago Deroy Murdock, National Review: “We are now exporting oil, which is the first time in my lifetime - we are right now the largest producer of oil and gas. This is not good if you’re Vladimir Putin where your chief export is oil. W.H. Agent - Not good for Kremlin.” @TuckerCarlson

He forgot the bit which says, oil pumped straight of the American owned wells seized off Iraq in Iraq.

[blacksheep]

In Reply To: blacksheep's post @ Jan 20 2019, 07:48 PM

China's economy cools in the fourth quarter, 2018 growth hits 28-year low
Kevin Yao

BEIJING (Reuters) - China’s economic growth cooled slightly in the fourth quarter from a year earlier as expected, weighed down by weak investment and faltering consumer confidence as Washington piled on trade pressure, leaving 2018 growth the weakest in 28 years.

Signs of further cooling in China — which has generated nearly a third of global growth in recent years — are stoking worries about risks to the world economy and are weighing on profits for firms ranging from Apple to big carmakers.

Fourth-quarter gross domestic product (GDP) grew at the slowest pace since the global financial crisis, easing to 6.4 percent from 6.5 percent in the third quarter, data from the National Bureau of Statistics showed on Monday. Analysts polled by Reuters had expected 6.4 percent.

That left full-year growth at 6.6 percent, the slowest rate of expansion China has seen since 1990. Analysts polled by Reuters had expected it to cool to 6.6 percent from a revised 6.8 percent in 2017.

read more - https://www.reuters.com/article/us-china-ec...w-idUSKCN1PF04A

China's economy meets growth forecasts but analysts remain doubtful
By business reporter Michael Janda
Posted 18 minutes ago
https://www.abc.net.au/news/2019-01-21/chin...stment/10731672

[blacksheep]

In Reply To: blacksheep's post @ Jan 20 2019, 08:14 PM

The suits are pressed and the jets are gassed up, as global political and business leaders prepare to converge in Davos for the World Economic Forum.

To prep the wide variety of world leaders attending the summit, the organization has just published its most recent edition of the Global Risks Report. The highly anticipated annual presentation puts the world’s most pressing issues into focus, giving a sense of what is top-of-mind for global decision-makers.

Below are the top five risks highlighted in this year’s report.

The complete 14th Edition of The Global Risks Report 2019 can be accessed here - > http://www3.weforum.org/docs/WEF_Global_Ri...Report_2019.pdf

Attached File(s)

 global_risks_2019.png ( 50.35K ) Number of downloads: 5

 

[blacksheep]

World Economy Wobbles on Eve of Davos With Politics to Blame
By Simon Kennedy
January 19, 2019, 11:00 AM GMT+11
Dimon, Merkel, Sandberg among the delegates attending WEF
Chinese data, IMF forecasts to set the tone at meetings

“The mood is going to be much darker than a year ago,” said Nariman Behravesh, IHS Markit’s chief economist, who will be in Davos. “A recession isn’t imminent, but as economies slow it wouldn’t take much to topple growth.”

High in the Alps, the global elite will be feeling low about the economic outlook.

The ski resort of Davos, Switzerland, will again play host next week to the World Economic Forum’s annual meeting, drawing JPMorgan Chase & Co.’s Jamie Dimon, German Chancellor Angela Merkel, Facebook Inc. Chief Operating Officer Sheryl Sandberg and Chinese Vice President Wang Qishan. Domestic political strife is forcing U.S. President Donald Trump and U.K. Prime Minister Theresa May to stay home.

Those still going will do so as their economies lose momentum just a year since they enjoyed a rare synchronized upturn. While few predict a recession, companies are the most bearish since 2016 as economic data falls short of expectations and political risks mount amid an international trade war, U.S. government shutdown and Brexit.

“The mood is going to be much darker than a year ago,” said Nariman Behravesh, IHS Markit’s chief economist, who will be in Davos. “A recession isn’t imminent, but as economies slow it wouldn’t take much to topple growth.”

The summit formally begins on Tuesday although the tone will be set a day before when the International Monetary Fund publishes new growth forecasts and China releases data likely to show expansion in 2018 was the slowest in almost three decades. The Bank of Japan and European Central Bank also have meetings next week at which policy makers may recast their outlooks.

“The evidence is consistent with slowdown rather than slump, but downside risks have increased,” said Tom Orlik, chief economist at Bloomberg Economics.

read more - https://www.bloomberg.com/news/articles/201...litics-to-blame?

[blacksheep]

China's looming great wall of debt may have 'major global implications'
By Tasha Wibawa
Posted earlier today at 5:49am

While many countries struggled following the 2008 global financial crisis, China appeared as though it had largely escaped unscathed.
But observers are becoming increasingly concerned Beijing will struggle to repay an ever-increasing mountain of debt, with potential detrimental consequences for the global market.
Key points:
China's rising levels of debt mostly attributed to a "credit boom" post GFC
Many large infrastructures are struggling to generate positive revenue
Chinese local government debt has been called an "iceberg" with "titanic risks"

read more - https://www.abc.net.au/news/2019-01-20/chin...ection=business

China set to post slowest growth in 28 years in 2018, more stimulus seen

China is expected to report on Monday that economic growth cooled to its slowest in 28 years in 2018 amid weakening domestic demand and bruising U.S. tariffs, adding pressure on Beijing to roll out more support measures to avert a sharper slowdown.

https://www.reuters.com/article/us-china-ec...n-idUSKCN1PE02Z