trending Market Intelligence /marketintelligence/en/news-insights/trending/3BIkpFj1f-3VtAH2EbLVvg2 content esgSubNav
In This List

US stocks up amid tariff exemptions, Trump seeking negative rates; dollar gains

Podcast

Street Talk Episode 87

Blog

A New Dawn for European Bank M&A Top 5 Trends

Blog

Insight Weekly: US banks' loan growth; record share buybacks; utility M&A outlook

Blog

Banking Essentials Newsletter 2021: December Edition


US stocks up amid tariff exemptions, Trump seeking negative rates; dollar gains

➤ Global shares rise, as China exempts certain U.S. goods from tariffs.

Trump seeks zero interest rate level or negative rates.

➤ Hong Kong Exchanges & Clearing proposes combination with LSE.

➤ Sterling under pressure as Scottish court ruling leads to more Brexit confusion.

➤ Euro retreats ahead of ECB decision tomorrow.

U.S. stocks posted modest gains after China exempted certain U.S. imports from additional tariffs and as U.S. President Donald Trump renewed pressure on the Fed to bring rates down, potentially below zero.

China disclosed a number of U.S. products that would be exempt from additional Chinese tariffs imposed last year, ahead of the next round of face-to-face discussions in October. The products, however, did not include major U.S. agricultural imports such as soybeans and pork.

Beijing said it will release additional exclusion lists, if needed.

"The exemption could be seen as a gesture of sincerity towards the U.S. ahead of negotiations in October but is probably more a means of supporting the economy," wrote Iris Pang, Greater China economist at ING, adding that Beijing is unlikely to change its stance as both camps prepare to enter the next round of talks.

The two largest economies of the world are unlikely to strike a trade deal this year, Pang wrote.

The exemptions were announced after the U.S. imposed preliminary duties on ceramic tile imports from China as part of a countervailing duty investigation.

The S&P 500 rose 0.1% around 9:30 a.m. ET. European bourses traded higher, with the FTSE 100 rising 1%, Germany's DAX increasing 0.8% and France's CAC 40 gaining 0.3%.

London Stock Exchange Group PLC jumped more than 6% after Hong Kong Exchanges & Clearing Ltd. proposed combining.

The proposed merger values the British bourse's entire issued and to-be-issued ordinary share capital at roughly £29.6 billion and implies an enterprise value of £31.6 billion.

The offer is contingent on LSE not proceeding with its proposed acquisition of financial data analytics platform Refinitiv. LSE said it will consider the proposal, but added that it remains committed to the Refinitiv deal.

In Asia, the Shanghai SE Composite fell 0.4%, while Japan's Nikkei 225 and Hong Kong's Hang Seng increased 1% and 1.8%, respectively. China on Sept. 10 announced a plan to scrap the limit on overseas funds buying domestic stocks and bonds as part of efforts to open its financial markets to foreign investors.

In currencies, the Dollar Index advanced 0.4%, as Trump sought a zero interest rate level or a negative rate policy. The Federal Reserve is due to announce its decision next week.

The euro depreciated 0.4% ahead of a widely anticipated stimulus package from the European Central Bank. An interest rate cut alone may not be enough to trigger a broad-based sell-off in the euro given that European sovereign bond prices and the single-currency markets have already factored in dovish expectations, said Ipek Ozkardeskaya of London Capital Group.

International Monetary Fund's Poul Thomsen called on Germany to increase public spending to revive the economy and address long-term structural challenges, before its too late, Bloomberg News reported.

Sterling lost 0.2% as the Scottish appellate court overturned an earlier ruling that declared U.K. Prime Minister Boris Johnson's decision to suspend Parliament for five weeks as lawful, but fell short of issuing an injunction for MPs to return.

The safe-haven Japanese yen dipped 0.2% versus the U.S. currency.

Yields on 10-year Treasurys gained 1 basis point to 1.746% around 9:30 a.m. ET, and so did those on German Bunds with the same maturity. Ten-year Italian bond yields lost 1 basis point as Prime Minister Giuseppe Conte received the green light to take office following weeks of political turmoil.

Brent crude oil advanced 0.5% to $62.68 per barrel on the ICE Futures Exchange. The U.S. Energy Information Administration lowered its crude oil price outlook through 2020 citing manufacturing indicators that may point to slowing global economic growth.

Gold edged down 0.2% to 1,496.30 per ounce.

More from S&P Global Market Intelligence:

US rate cut ends growth trend in Americas transaction banking revenues

Unfavorable EU court ruling could force 'massive' provisions at Polish banks

Mnuchin: Fannie, Freddie could avoid systemic label with capital buffer of $100B

Deutsche restructuring was never about giving up US business, CFO says

US REIT median implied cap rates hold steady in Q2

New iPhones expected to fuel Apple's services strategy

The day ahead:

10 a.m. ET — Atlanta Fed's U.S. business inflation expectations survey

10:30 a.m. ET — Energy Information Administration petroleum status report

7:50 p.m. ET — Japan machine orders

7:50 p.m. ET — Japan producer price index