The recent round of selling has taken a bite out of stocks around the world, but the year-to-date results continue to favor China’s equities by a wide margin, based on a set of US-listed exchange-traded products representing the major regions of the world through yesterday’s close (Sep. 10).

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Wildfires continue to rage across US West: BBC
Senate defeats a coronavirus stimulus bill: Reuters
Federal court blocks Trump order to exclude illegal immigrants from census: USAT
US economy recovering faster than expected, survey of economists reports: WSJ
Global economic rebound continues in Q3 but risk of slowdown looms: WSJ
UK economy continued to rebound in July: MW
China approves phase I human testing for nasal spray coronavirus vaccine: BBG
UK and Japan agree on trade deal–first major deal for UK since Brexit: CNBC
US jobless claims continued rising at worrisome pace last week: CNBC

The record decline in US output in the second quarter is expected to post a strong but partial recovery in the upcoming Q3 GDP report, according to several recent nowcasts compiled by CapitalSpectator.com.

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Trump admits to downplaying coronavirus risk: USAT
US official claims pressure to downplay Russian election interference: BBC
EU faces challenge of stronger euro as economy struggles to recover: BBG
EU and UK to hold emergency talks on UK plan to undercut Brexit: Reuters
World wildlife remains in “catastrophic decline,” report warns: BBC
China’s auto sales rose 6% in August vs. year-earlier level: BC
Record 2.5 million acres burning across the West: NYT
US job openings continued to rebound in July: Reuters

It was risk-off late last week, but today’s bounce in US stocks has the bulls cheering once more. The S&P 500 closed up 2.0% on Wed., Sep. 9. Although the gain was well below the high point of the day, it was strong enough to inspire forecasts that last week’s slide was one more temporary detour on the road to ever higher prices.

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Last week I briefly reviewed the case for casting a wary eye on expecting the standard stock-bond asset allocation to fulfill its historical role as a risk-management tool. Let’s extend this thought experiment by comparing results for possible bond replacements in the classic 60/40 stock/bond portfolio.

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AstraZeneca Covid-19 vaccine study put on hold due to adverse reaction: STAT
Wildfires burning across three Western states: CNN
Trump to announce further reduction in US troops in Iraq: Reuters
Tensions rise on India-China border as shots are fired: NYT
US companies in China expect bilateral tensions will last for years: Reuters
China’s consumer inflation eased to moderate 2.4% annual pace in Aug: SCMP
Oil prices fall sharply on rising supply and falling demand: CNN
Consumer credit in July rose for a second month: BBG
US small business sentiment edges up in Aug — above 46-year avg: NFIB
10-year US Treasury yield: Going nowhere fast:

The US trading week begins with a fresh dose of red ink hanging over the major asset classes from last week’s sell-off. With the exception of foreign corporate bonds and investment-grade fixed-income in the US, all flavors of global markets lost ground last week (through Sep. 4), based on a set of proxy ETFs.

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Trump says he plans to sharply reduce US-China economic ties: BBG
US states facing deep fiscal crisis: NYT
California wildfires create new electricity blackouts: AP
China’s exports continued to rebound in August: CNBC
Last two Australian reporters in China are flown out of country: BBC
The once-solid Exxon dividend is suddenly in doubt: Reuters
US payrolls continued to recover in Aug but losses still deep for some sectors: FTE

“Without labor nothing prospers.”
– Sophocles