Amplify Trading Global Markets Review - 29th August 2019

Amplify Trading Global Markets Review - 29th August 2019

Today's Highlights

  • Trump: "High-level call with China scheduled today"

  • PM Conte accepts mandate to form PD-M5S Government

  • UK Labour McDonnell said confident to get cross-party majority to avert no-deal

Macro Review

Looks like Trump, Johnson and Salvini had the same political training or just happen to be very smart and hated at the same time. But that is not a surprise - the populist Trio is easy target for the press and at the end of the day everyone has to do his jobs. Someone needs to sell more copies and others draw a line between factual and biased views. Therefore, PM Johnson puts Parliamentary activity on ice in order to accomplish is "do-it-or-die" Brexit, closing one of the longest session in 400 years of the UK Parliamentary history - 340 days. Possible scenarios ahead include, Labour calling for no-confidence vote, which is very unlikely to go through for two reasons: 1) Tories will never risk handing Brexit over to Corbyn, 2) Labour is not ready to run an electoral campaign when its views on Brexit has never been clear. Moreover, even if 1) and 2) happen, then BoJo would have washed his hands and leave Labour holding the stick.

Over to Italian Politics, today PM Conte was given mandate from Mattarella to form a new PD-M5S Government after Salvini - Lega's leader - pulled the plug to the alliance with M5S. The move has already been judged the start of the end for the Lega in the Italian Press that cheers the new coalition - blessed by the approval of markets and Brussels. Without doubting anyone intelligence, but I find hard to believe Salvini's move doesn't find strategical grounds when his party is at the peak of political consensus and Europe is practically already in a recession. Salvini is playing the long game. PD and M5S have radical different views and neither side will be willing to get too exposed. Clear evidence is that both PD and M5S leaders will not cover relevant positions in the new cabinet. Possible scenarios ahead include: 1) PD-M5S concluding the remainder of the mandate (2 years) before new elections; 2) PD-M5S Government doesn't survive 2019 and Mattarella appoints a technical government before new election. Bottom line: election will come and Salvini has got a lot of hedge against the PD - that has been part of the last 6 coalition governments - as result of the President appointment and clearly lost the latest round of Political and European elections.

EU Close

If you missed the morning briefing from the desk click HERE

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