Market awaits Trump speech at the New York Economic Club (5 pm GMT)
Futures markets frozen ahead of today Trump's address at the Economic Club of New York. The US President speech will be closely watched by investors anxious for any positive development over a long-running trade war with China. Despite last week optimism from Chinese sources over a possible rollback of tariffs in the upcoming Phase 1 deal - expected to be papered and signed by year end - US Trade Representative said that nothing on current tariffs has been agreed yet. However, risk appetite has revamp over the last couple of weeks as safe havens pull back to key level of support and equities print fresh daily all-time-highs. I must admit, it is extraordinary to look at the stock market behaving like investors are scared of nothing. With the FED on the path of keeping interest rates for the foreseeable future and no-escalation in a trade war I am starting to think that only a "financial event" could take SP500 back down. Surely, economic data will have its say in the next months and clarify whether this phase is only a transitory or a presentiment of more clouds ahead. For now in a world without inflation, record low interest rates and huge amount of liquidity in the system it looks like nothing can scare investors which will probably be exposed more to some sort of "technical correction risk" like we have seen in the past - look at Feb 2017 - rather than something more substantial. However, before it happens it has already happened!
Looking over the other macro theme of the last 3 years! (what a boring life we all have). Find below a very useful couple of info graphics from the ING Economics team on the scenarios ahead for the UK economy and Brexit past the General Election on December 12th.
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If you missed the morning briefing from the desk click HERE