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Wall Street eyes another high as trade tensions simmer, China posts GDP data


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Wall Street eyes another high as trade tensions simmer, China posts GDP data

➤ S&P 500 on course for record high; European Stoxx 600 at fresh high too.

➤ US Senate passes USMCA.

➤ China GDP growth in line with expectations, but slowest in 29 years.

➤ Pound falls as falling UK retail sales boost rate cut bets.

Wall Street was on course to notch another record high as global trade tensions dialed down and China posted growth that largely matched estimates.

Futures for the S&P 500 and the Nasdaq 100 were up 0.3% and 0.4%, respectively, around 6:30 a.m. ET. The indexes hit a record high yesterday after Morgan Stanley posted record earnings.

Citizens Financial Group Inc.Overnight, the U.S. Senate passed the United States-Mexico-Canada Agreement, bringing a process of more than two years to replace the North American Free Trade Agreement almost to a close. This comes following the recent signing of a "phase one" trade deal between the U.S. and China.

Meanwhile, EU Trade Commissioner said he had a "very good meeting" with U.S. Commerce Secretary Wilbur Ross on ways to improve the transatlantic business environment.

The pan-European Stoxx 600 added 0.8% to a record high, as French and U.K. stocks gained 0.9% each. Germany's DAX index rose 0.7%.

The Shanghai SE Composite was little changed and Hong Kong's Hang Seng index gained 0.6% as China's GDP growth slowed to a 29-year low in 2019 to 6.1%. The reading is within the government's target growth for the year of between 6% and 6.5%.

The Chinese economy is projected to grow by 6% annually in 2020 as the outlook has improved, and the country may not ease policy significantly for now, said Oxford Economics Senior Economist Tommy Wu and Head of Asia Economics Louis Kuijs. "Sluggish global growth will continue to challenge the external outlook, though the phase one deal is likely to benefit exports and domestic sentiment," according to the Oxford Economics note.

However, Martin Rasmussen, China economist at Capital Economics, sees further monetary easing by the Chinese central bank if a slowdown in domestic demand renews.

Japan's Nikkei 225 index was up 0.5%.

The Dollar Spot Index gained 0.2%.

The pound dropped 0.4% to $1.3033 as falling U.K. retail sales boosted rate cut bets further. Sterling came under pressure after GDP data fueled speculation that the Bank of England could lower rates at its monetary policy meeting this month.

The euro slipped 0.2%, the Japanese yen was flat and the Chinese yuan appreciated 0.2% against the dollar.

Among bonds, Treasurys edged lower as the 10-year yield added 1 basis point to 1.818%. German Bunds' yields were flat at negative 0.218%.

In commodities, Brent crude oil jumped 0.8% to $65.11 per barrel on the ICE Futures Exchange. Gold gained 0.4%.

More from S&P Global Market Intelligence:

To hit trade goals by 2021, US oil and gas industry needs 20% of China's market

Visa's $5.3B acquisition of Plaid seen boosting bank-fintech partnerships

New Zealand, Taiwan stocks led Asia-Pacific surge in 2019

Diesel's decline may not be such good news for environmentalists, carmakers

Hungary's central bank tests green capital discount with eco-friendly mortgages

LatAm currencies led emerging market rebound at 2019-end; ruble shines in 2019

Australia's largest insurers brace for greater bushfire severity as claims grow

Credit union-bank deal rejected by Colorado state regulator

The day ahead:

8:30 a.m. ET — U.S. housing starts (Econoday consensus: 1.373 million)

9 a.m. ET — U.S. Fed's Patrick Harker speaks

9:15 a.m. ET — U.S. industrial production (Econoday consensus: -0.3% monthly)

10 a.m. ET — U.S. consumer sentiment (Econoday consensus: 99.3)

10 a.m. ET — U.S. JOLTS (Econoday consensus: 7.10 million job openings)

12:45 p.m. ET — U.S. Fed's Randal Quarles speaks

1 p.m. ET — U.S. Baker-Hughes rig count

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