The stock market has taken investors on a white-knuckle ride in 2019, but despite the surge in volatility lately all the major equity sectors continue to post year-to-date gains, based on a set of exchange-traded funds. Leading the field by a substantial margin: technology shares, closely followed by real estate investment trusts (REITs).
Macro Briefing | 8 August 2019
China’s exports unexpectedly rose in July despite US tariffs: CNBC
Pakistan-India ties fray over India’s policy changes in Kashmir: BBC
US immigration authorities arrest nearly 700 people in Mississippi: Reuters
Treasury yields bounce on Thursday after yesterday’s sharp drop: CNBC
Negative yields are a possibility for the US, predicts Pimco analyst: MW
China’s central bank hints at weaker-currency policy: NY Times
US consumer credit growth continued to slow in June: MW
Oil prices fall to 7-month low on economic worries: Reuters
Early Q3 GDP Estimates Anticipate Modest Growth For US
The recent slowdown in US economic growth is expected to continue in the third quarter, based on recent nowcasts. The numbers suggest that the current expansion, the longest on record, will endure. But with no end in sight for the US-China trade war, and elevated risk that a currency war is brewing for the planet’s two largest economies, the potential for trouble is rising.
Macro Briefing | 7 August 2019
N. Korea’s Kim says recent missile launches are warning to US: CNBC
US-China trade war raising global recession risk: Bloomberg
US trade tariffs cost US firms $3.4 billion in June: Reuters
China and Pakistan warn India over changes in disputed border area: Newsweek
German industrial output fell at deepest annual rate in a decade: BBG
India’s central bank cuts interest rates for fourth time: CNBC
US job openings slipped in June but remain above 7 million for 15th month: MW
Is President Trump Losing Control Of His Trade War?
For several months all was working well. Or so it seemed. Slowly ratcheting up trade tariffs on China gave President Trump several talking (and tweeting) points with minimal economic blowback. US growth slowed, but only modestly and in any case it wasn’t obvious that the trade war was to blame. But the game may have changed on Monday, when China let its currency fall below rise above a psychologically key red line: 7 to the US dollar, marking the lowest point in more than a decade for the yuan.
Macro Briefing | 6 August 2019
US Treasury labels China as “currency manipulator”: WSJ
Currency-war risk is rising: CNBC
China acts to limit weakness in yuan: Bloomberg
N. Korea launches missiles into sea for 4th time within 2 weeks: Reuters
Former Fed governors warn that central bank should remain independent: CNN
German factory orders rebounded in June: Bloomberg
Global output edged up to three-month high in July: IHS Markit
Services PMI for US ticked up in July to four-month high: IHS Markit
US services growth (ISM Non-MFg Index) fell to three-year low in July: CNBC
10-year Treasury yield drops to 1.75%–lowest since 2016:
US REITs Continued To Rebound Last Week As Stocks Tumbled
Real estate investment trusts (REITs) led the major asset classes last week as investors dumped stocks, based on a set of exchange-traded funds. Equities in emerging markets took the biggest hit as escalating tensions in the US-China trade war triggered a rise into safe-haven assets.
Macro Briefing | 5 August 2019
Back-to-back shootings stun America over the weekend: NY Times
Hong Kong protests pushing city to “extremely dangerous situation”: Reuters
India revokes special status for Kashmir, risking new outbreak of violence: BBC
Iran says it seized another oil tanker in Persian Gulf: CNN
China moves to suspend imports of US agricultural products: Bloomberg
Trump overruled advisors in approving new sanctions on China: WSJ
China’s services sector expanded at slowest pace in 7 months in July: Reuters
Final Eurozone Composite PMI for July shows nearly stagnant output: IHS Markit
US payrolls rose moderately in July: CNBC
US consumer sentiment held near post-recession high in July: MW
Factory orders in US rose less than expected in June: Reuters
China allows yuan to fall to 7 against US dollar in trade-war escalation: Bloomberg
Book Bits | 3 August 2019
By Jennifer M. Silva
Summary via publisher (Oxford U. Press)
The economy has been brutal to American workers for several decades. The chance to give one’s children a better life than one’s own — the promise at the heart of the American Dream — is withering away. While onlookers assume those suffering in marginalized working-class communities will instinctively rise up, the 2016 election threw into sharp relief how little we know about how the working-class translate their grievances into politics. In We’re Still Here, Jennifer M. Silva tells a deep, multi-generational story of pain, place, and politics that will endure long after the Trump administration. Drawing on over 100 interviews with black, white, and Latino working-class residents of a declining coal town in Pennsylvania, Silva reveals how the decline of the American Dream is lived and felt.
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US Private-Employment Hiring Rose Modestly In July
US companies added 148,000 workers to payrolls in July (on a seasonally adjusted basis), the Labor Department reports. The gain is below June’s increase, but the one-year trend for private payrolls was steady, as expected, at a respectable +1.7%.
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