Economists: The Fed ‘isn’t enough’ to offset damage of tariff skirmishes with China and Mexico

A dovish Federal Reserve can use tools such as rate cuts to lessen the damage of America’s tariff skirmishes with China and Mexico, but it is either limited in its effectiveness or in its motivations, two economists told CNBC on Thursday. “The Fed can mitigate some of the adverse effects, but I’m not sure the Fed is inclined to move fast enough or significantly enough to entirely offset the effects of this trade war. All these geopolitical, tariffs, sanctions, trade risks are really damaging to


A dovish Federal Reserve can use tools such as rate cuts to lessen the damage of America’s tariff skirmishes with China and Mexico, but it is either limited in its effectiveness or in its motivations, two economists told CNBC on Thursday. “The Fed can mitigate some of the adverse effects, but I’m not sure the Fed is inclined to move fast enough or significantly enough to entirely offset the effects of this trade war. All these geopolitical, tariffs, sanctions, trade risks are really damaging to
Economists: The Fed ‘isn’t enough’ to offset damage of tariff skirmishes with China and Mexico Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-07  Authors: weizhen tan
Keywords: news, cnbc, companies, isnt, fed, tensions, offset, tariffs, damage, trade, china, effects, skirmishes, economists, monetary, mexico, markets, tariff


Economists: The Fed 'isn't enough' to offset damage of tariff skirmishes with China and Mexico

A dovish Federal Reserve can use tools such as rate cuts to lessen the damage of America’s tariff skirmishes with China and Mexico, but it is either limited in its effectiveness or in its motivations, two economists told CNBC on Thursday.

Instead, the U.S. has to resolve those issues at the negotiating table, Nathan Sheets, chief economist at asset manager PGIM Fixed Income, told CNBC at the IIF Spring Membership Meeting in Tokyo.

“The Fed can mitigate some of the adverse effects, but I’m not sure the Fed is inclined to move fast enough or significantly enough to entirely offset the effects of this trade war. I think ultimately the solution or resolution of this has to come at the negotiating table between President (Donald) Trump and President Xi (Jinping), and between the United States and Mexico, ” he said.

“The Fed will do its best given where the economy is, but it would take a dramatic easing of monetary policy for them to fully offset these kinds of effects,” Sheets added.

U.S. Federal Reserve Chairman Jerome Powell had on Tuesday signaled that the central bank was open to easing monetary policy to support the economy, amid increasing expectations for multiple Fed rate cuts this year.

He said the central bank is watching current economic developments and will do what it must to keep the near-record expansion going.

Also speaking to CNBC at the IIF Spring Membership Meeting, Robin Brooks, chief economist at the Institute of International Finance, added: “There are some warning signs … we are worried about (emerging markets). All these geopolitical, tariffs, sanctions, trade risks are really damaging to emerging markets, and a dovish Fed isn’t enough to offset those.”

Markets have been spooked by trade tensions that spread to Mexico last week when Trump announced that the U.S. will impose tariffs on Mexican goods, with more duties to be added until the country takes action on immigration that’s deemed sufficient by the White House.

Meanwhile, U.S. trade tensions with China continue to be unresolved, with rhetoric turning more negative in the past two weeks.

Meanwhile, the International Monetary Fund warned on Wednesday that U.S.-China tariffs — both implemented and proposed — could cut global economic output by 0.5% in 2020. It also lowered its 2019 growth forecast for China to 6.2% from 6.3%.

The IMF has been revising down its projections for global growth in recent quarters as trade tensions and concerns surrounding China have fueled plunges in stock markets and dented corporate earnings.

— CNBC’s Matt Clinch contributed to this report.


Company: cnbc, Activity: cnbc, Date: 2019-06-07  Authors: weizhen tan
Keywords: news, cnbc, companies, isnt, fed, tensions, offset, tariffs, damage, trade, china, effects, skirmishes, economists, monetary, mexico, markets, tariff


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Dow rallies 180 points for its fourth-straight gain on hopes US-Mexico trade talks making progress

The S&P 500 rose 0.61% to 2,843.49 while the Nasdaq Composite gained 0.53% to 7,615.55. The talks between U.S. and Mexican officials resumed Thursday afternoon after they failed to reach an agreement on Wednesday. Shares of companies with the most to lose from Mexico tariffs pared their losses on the new headlines. The S&P 500 and Nasdaq are up 3.3% and 2.2%, respectively, this week. Both the Dow and S&P 500 are on pace for their best weeks since November.


The S&P 500 rose 0.61% to 2,843.49 while the Nasdaq Composite gained 0.53% to 7,615.55. The talks between U.S. and Mexican officials resumed Thursday afternoon after they failed to reach an agreement on Wednesday. Shares of companies with the most to lose from Mexico tariffs pared their losses on the new headlines. The S&P 500 and Nasdaq are up 3.3% and 2.2%, respectively, this week. Both the Dow and S&P 500 are on pace for their best weeks since November.
Dow rallies 180 points for its fourth-straight gain on hopes US-Mexico trade talks making progress Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-06  Authors: yun li fred imbert, yun li, fred imbert
Keywords: news, cnbc, companies, reported, trade, fourthstraight, tariffs, week, rose, usmexico, hopes, progress, points, gain, 500, talks, tariff, mexico, sp, rallies, making


Dow rallies 180 points for its fourth-straight gain on hopes US-Mexico trade talks making progress

Stocks rose on Thursday as investors speculated that the U.S. and Mexico are getting closer to a resolution over immigration issues that would delay the tariffs threatened by President Donald Trump.

The Dow Jones Industrial Average gained 181.09 points to 25,720.66, bringing its gain for the week to more than 900 points and putting it on pace for its best week of the year. The S&P 500 rose 0.61% to 2,843.49 while the Nasdaq Composite gained 0.53% to 7,615.55.

The talks between U.S. and Mexican officials resumed Thursday afternoon after they failed to reach an agreement on Wednesday. Martha Barcena Coqui, Mexico’s ambassador to the U.S., told CNBC on Thursday that negotiators had “a very good discussion, a very good debate. ”

The U.S. had asked Mexico to keep Central American asylum seekers and require migrants without proper documentation to stay in Mexico “for the duration of their immigration proceedings,” CNBC previously reported. The talks are poised to continue at 5:30 p.m. ET Thursday at the State Department.

Stocks hit their highs of the day after Bloomberg News reported that the U.S. is considering a postponement to Trump’s 5% tariff on all Mexican imports after the country’s negotiators asked for more time to hash out a deal. The tariff is set to kick in on Monday.

Shares of companies with the most to lose from Mexico tariffs pared their losses on the new headlines. Shares of Ford, GM and Kansas City Southern took a noticeable jump, though the three still finished the day lower.

Thursday’s gains followed the Dow’s 500-point jump on Tuesday, its second-best session of 2019. The index’s subsequent 200-point climb on Wednesday and Thursday’s gains have pushed its week-to-date performance up more than 3.6%. The S&P 500 and Nasdaq are up 3.3% and 2.2%, respectively, this week. Both the Dow and S&P 500 are on pace for their best weeks since November.


Company: cnbc, Activity: cnbc, Date: 2019-06-06  Authors: yun li fred imbert, yun li, fred imbert
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Trump’s Mexico tariff threat worries US farmers already pummeled by China trade war

Daniel Acker | Bloomberg | Getty ImagesPresident Donald Trump’s threatened 5% tariff on all Mexican imports could hit American farmers especially hard if Mexico retaliates with punitive duties on U.S. agricultural products. Farmers are already reeling from Trump’s drawn out trade war with China and fear further losses could be in their futures. Even so, that hasn’t stopped other countries from chipping away at American agricultural dominance when it comes to supplying its neighbor to the south w


Daniel Acker | Bloomberg | Getty ImagesPresident Donald Trump’s threatened 5% tariff on all Mexican imports could hit American farmers especially hard if Mexico retaliates with punitive duties on U.S. agricultural products. Farmers are already reeling from Trump’s drawn out trade war with China and fear further losses could be in their futures. Even so, that hasn’t stopped other countries from chipping away at American agricultural dominance when it comes to supplying its neighbor to the south w
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Company: cnbc, Activity: cnbc, Date: 2019-06-05  Authors: jeff daniels
Keywords: news, cnbc, companies, mexico, worries, products, mexican, threat, trumps, farm, tariffs, china, agricultural, pummeled, farmers, american, trade, war, tariff, goods


Trump's Mexico tariff threat worries US farmers already pummeled by China trade war

A farmer fills seed boxes on a Case IH Agricultural Equipment planter while planting corn in Princeton, Illinois, April 24, 2018. Daniel Acker | Bloomberg | Getty Images

President Donald Trump’s threatened 5% tariff on all Mexican imports could hit American farmers especially hard if Mexico retaliates with punitive duties on U.S. agricultural products. Farmers are already reeling from Trump’s drawn out trade war with China and fear further losses could be in their futures. “When you look at all the different products that the U.S. exports to Mexico, all those folks are getting nervous that retaliatory tariffs could certainly find their way onto their products,” said Veronica Nigh, an economist with the American Farm Bureau Federation, the nation’s largest farm sector organization. Mexico is considered one of the most lucrative markets for American agriculture products given its easy access and close proximity to the U.S, whether via rail, ship or truck. Even so, that hasn’t stopped other countries from chipping away at American agricultural dominance when it comes to supplying its neighbor to the south with grains, meats and other farm products. The U.S. exported $19 billion in agricultural exports to Mexico last year, making it the second-largest purchaser after Canada, according to the U.S. Department of Agriculture. Mexico is the top market for U.S. corn, rice, dairy products, poultry, eggs, pecans and also a major buyer of American beef, pork, soybeans and wheat.

Farmer walks through his soy fields in Harvard, Illinois. Nova Safo | AFP | Getty Images

Frustrated with Central American migration, the White House last Thursday announced the U.S. plans to slap 5% tariffs on Mexican goods, including cars, beer, tequila, as well as fruits and vegetables. The duties would start June 10 and gradually increase to 25% on Oct. 1 unless Mexico “substantially stops the illegal inflow of aliens coming through its territory.” “If you put a tariff on imported goods, usually that price gets passed to consumers,” said Luis Ribera, an agricultural economist at Texas A&M University. “And you can expect that Mexico will retaliate one way or another.” Mexican officials in Washington this week as part of a diplomatic push to avert new tariffs are warning the levies won’t stop the flow of migrants. Talks between U.S. and Mexican officials on Wednesday failed to produce a deal, a senior administration official told NBC News. Trump slapped tariffs last year on imported steel and aluminum, resulting in Mexico imposing levies on $3 billion of U.S. goods, including a variety of agricultural products. The U.S. last month lifted metals tariffs against Mexico and Canada as part of a push to get ratification of the pending United States-Mexico-Canada Agreement. However, Trump’s threat to impose new tariffs against Mexico over immigration puts USMCA in jeopardy and raises the risk of additional financial fallout for American farmers already hurting from the escalating trade war with China. The new USMCA is designed to replace the North American Free Trade Agreement, a 25-year-old pact between the U.S., Canada and Mexico.

“Amid a perfect storm of challenges in farm country, we cannot afford the uncertainty this action would bring.” Lynn Chrisp president, National Corn Growers Associatiop


Company: cnbc, Activity: cnbc, Date: 2019-06-05  Authors: jeff daniels
Keywords: news, cnbc, companies, mexico, worries, products, mexican, threat, trumps, farm, tariffs, china, agricultural, pummeled, farmers, american, trade, war, tariff, goods


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It’s not China or the US: Here are the trade war’s winners — so far

China’s President Xi Jinping (L) and US President Donald Trump attend a welcome ceremony at the Great Hall of the People in Beijing on November 9, 2017. Instead, importers in the two countries have been sourcing for the same products from alternative locations not targeted by tariffs, the economists said in a report outlining their findings. Vietnam has so far emerged as the largest beneficiary of that diversion in trade flows, gaining an estimated 7.9% of its gross domestic product from those n


China’s President Xi Jinping (L) and US President Donald Trump attend a welcome ceremony at the Great Hall of the People in Beijing on November 9, 2017. Instead, importers in the two countries have been sourcing for the same products from alternative locations not targeted by tariffs, the economists said in a report outlining their findings. Vietnam has so far emerged as the largest beneficiary of that diversion in trade flows, gaining an estimated 7.9% of its gross domestic product from those n
It’s not China or the US: Here are the trade war’s winners — so far Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-04  Authors: yen nee lee
Keywords: news, cnbc, companies, economists, tariff, report, trade, tariffs, china, importing, diversion, president, far, largest, winners, wars


It's not China or the US: Here are the trade war's winners — so far

China’s President Xi Jinping (L) and US President Donald Trump attend a welcome ceremony at the Great Hall of the People in Beijing on November 9, 2017.

More than one year since the start of a trade war between Washington and Beijing, economists from Japanese investment bank Nomura found evidence that the U.S. and China — in order to avoid elevated tariffs — have cut down importing certain goods from each other.

Instead, importers in the two countries have been sourcing for the same products from alternative locations not targeted by tariffs, the economists said in a report outlining their findings. Vietnam has so far emerged as the largest beneficiary of that diversion in trade flows, gaining an estimated 7.9% of its gross domestic product from those new business, according to Nomura.

“As tit-for-tat tariff hikes between the US and China increase, so does the cost of importing from each other,” the economists wrote in the report dated June 3.

“Some exporters in the US and China may be willing to absorb part of the additional tariff costs in their profit margins, and some multinationals could opt to re-shore production, but the trade literature shows that, over time, the largest response is likely to be trade diversion, ” they added.


Company: cnbc, Activity: cnbc, Date: 2019-06-04  Authors: yen nee lee
Keywords: news, cnbc, companies, economists, tariff, report, trade, tariffs, china, importing, diversion, president, far, largest, winners, wars


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Amazon paid a Trump fundraiser to lobby against vendors who sell counterfeit goods

Amazon tapped a lobbying firm run by an ally of President Donald Trump to push for government action against vendors selling counterfeit goods – an issue that has come under greater scrutiny during the U.S. trade battle with China. They’re trying to “stop third party actors from shipping fake Nikes to the United States under the guise that they’re real products,” said a person familiar with their efforts. Amazon is increasingly concerned about fake and pirated products on its marketplace. In Apr


Amazon tapped a lobbying firm run by an ally of President Donald Trump to push for government action against vendors selling counterfeit goods – an issue that has come under greater scrutiny during the U.S. trade battle with China. They’re trying to “stop third party actors from shipping fake Nikes to the United States under the guise that they’re real products,” said a person familiar with their efforts. Amazon is increasingly concerned about fake and pirated products on its marketplace. In Apr
Amazon paid a Trump fundraiser to lobby against vendors who sell counterfeit goods Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-04  Authors: brian schwartz
Keywords: news, cnbc, companies, amazon, paid, counterfeit, products, vendors, tariff, fake, shipping, lobby, lobbying, goods, trump, fundraiser, trade, sell


Amazon paid a Trump fundraiser to lobby against vendors who sell counterfeit goods

Amazon tapped a lobbying firm run by an ally of President Donald Trump to push for government action against vendors selling counterfeit goods – an issue that has come under greater scrutiny during the U.S. trade battle with China.

From July 2018 until March 2019, Amazon has been paying Ballard Partners up to $70,000 each quarter for, in part, lobbying on issues related to “trade and tariff policy,” according to three disclosure reports. However, people familiar with the matter said that the disclosure reports only tell part of the story.

Brian Ballard, a leading fundraiser in Florida for Trump during the 2016 presidential election, has been lobbying members of Trump’s administration and Congress on Amazon’s behalf to fight back against third party vendors who are selling fake products to their customers.

They’re trying to “stop third party actors from shipping fake Nikes to the United States under the guise that they’re real products,” said a person familiar with their efforts. Amazon is increasingly concerned about fake and pirated products on its marketplace. In a February warning to investors, the company used the word “counterfeit” for the first time.

In April, a month after the lobbying firm’s last recorded effort on “trade and tariff” policies for Amazon, Trump signed a memorandum that aimed to curb the sale of counterfeit items online.

“This is a shot across the bow to those companies. If you don’t clean it up, then the government will,” Trump trade advisor Peter Navarro, who is known as a China hawk, told reporters at the time. The memorandum calls on the Departments of Homeland Security, Commerce and Justice to issue a report recommending potential regulatory measures to combat the sale and eventual shipping of these fake goods.


Company: cnbc, Activity: cnbc, Date: 2019-06-04  Authors: brian schwartz
Keywords: news, cnbc, companies, amazon, paid, counterfeit, products, vendors, tariff, fake, shipping, lobby, lobbying, goods, trump, fundraiser, trade, sell


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US denies GM request for tariff relief for Chinese-made Buick SUV

Why Apple’s Siri isn’t as smart as Amazon Alexa and Google…Computer scientists have been working on some of their underlying technologies for more than half a century — so why can’t Apple make Siri work better? Here’s where virtual…Technologyread more


Why Apple’s Siri isn’t as smart as Amazon Alexa and Google…Computer scientists have been working on some of their underlying technologies for more than half a century — so why can’t Apple make Siri work better? Here’s where virtual…Technologyread more
US denies GM request for tariff relief for Chinese-made Buick SUV Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-04
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US denies GM request for tariff relief for Chinese-made Buick SUV

Why Apple’s Siri isn’t as smart as Amazon Alexa and Google…

Computer scientists have been working on some of their underlying technologies for more than half a century — so why can’t Apple make Siri work better? Here’s where virtual…

Technology

read more


Company: cnbc, Activity: cnbc, Date: 2019-06-04
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Goldman Sachs is predicting an escalation of global trade wars

Goldman Sachs has revised up its expectations of an escalation to U.S. trade wars with China and Mexico. There is now a 60% chance of the U.S. placing a new 10% tariff on the final $300 billion of Chinese imports, a note from the Wall Street investment bank said Monday. Last month, President Donald Trump announced that tariffs on $200 billion worth of Chinese goods would increase from 10% to 25%. Washington has now begun looking into whether $300 billion worth of other Chinese imports will also


Goldman Sachs has revised up its expectations of an escalation to U.S. trade wars with China and Mexico. There is now a 60% chance of the U.S. placing a new 10% tariff on the final $300 billion of Chinese imports, a note from the Wall Street investment bank said Monday. Last month, President Donald Trump announced that tariffs on $200 billion worth of Chinese goods would increase from 10% to 25%. Washington has now begun looking into whether $300 billion worth of other Chinese imports will also
Goldman Sachs is predicting an escalation of global trade wars Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-03  Authors: elliot smith
Keywords: news, cnbc, companies, chinese, billion, tariff, worth, global, increase, tariffs, trump, predicting, goldman, escalation, trade, wars, sachs, revised, chance, imports


Goldman Sachs is predicting an escalation of global trade wars

Goldman Sachs has revised up its expectations of an escalation to U.S. trade wars with China and Mexico.

There is now a 60% chance of the U.S. placing a new 10% tariff on the final $300 billion of Chinese imports, a note from the Wall Street investment bank said Monday. This is an increase from a previous estimate of 40%. Last month, President Donald Trump announced that tariffs on $200 billion worth of Chinese goods would increase from 10% to 25%. Washington has now begun looking into whether $300 billion worth of other Chinese imports will also be subject to increased levies.

Goldman also revised its assumptions of a tariff on all Mexican products, suggesting there is now a 70% chance Trump will impose duties on the first 5% of Mexican goods and a 50% chance that this will increase to 10%.

Trump recently threatened Mexico with 5% tariffs on its imports, to be implemented on June 10, unless it could stem the flow of migrants to the southern U.S. border.

“Additional tariff rate increases or an across-the-board auto tariff are also possible but not our base case,” the analyst team led by Jan Hatzius said in the note. Goldman revised up the possibility of sweeping auto tariffs being introduced this year to 40%, from 25% previously.

While deals with China and Mexico are anticipated to represent a removal of tariffs, this is not expected until late 2019 or into 2020.


Company: cnbc, Activity: cnbc, Date: 2019-06-03  Authors: elliot smith
Keywords: news, cnbc, companies, chinese, billion, tariff, worth, global, increase, tariffs, trump, predicting, goldman, escalation, trade, wars, sachs, revised, chance, imports


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A full breakdown of where the stock market stands today and whether the tariff pain is priced in

This is not to minimize the damage to the market or underplay its precarious condition. The nearly 7% drop in the S&P 500 since its April 30 high has been swift, even if it is well within the band of a routine pullback after a strong four-month rally. Over the past two weeks, on average close to 10% of S&P 500 stocks a day made a new 52-week low. And this selling squall is striking the market at a consequential point, the benchmark in a disputed zone between continuing uptrend and breakdown. Ear


This is not to minimize the damage to the market or underplay its precarious condition. The nearly 7% drop in the S&P 500 since its April 30 high has been swift, even if it is well within the band of a routine pullback after a strong four-month rally. Over the past two weeks, on average close to 10% of S&P 500 stocks a day made a new 52-week low. And this selling squall is striking the market at a consequential point, the benchmark in a disputed zone between continuing uptrend and breakdown. Ear
A full breakdown of where the stock market stands today and whether the tariff pain is priced in Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-03  Authors: michael santoli
Keywords: news, cnbc, companies, stands, stock, 500, point, selling, market, stocks, pain, tariff, breakdown, sp, trade, today, sentiment, bonds, months, priced


A full breakdown of where the stock market stands today and whether the tariff pain is priced in

The bad news: The opening of a second trade-war front along the U.S.-Mexico border last week dialed up fear of global economic stagnation and peaking corporate profits, further pressuring stocks and prompting an urgent rush into Treasury bonds. The good news: The surprise tariff threat on Mexico pushed Wall Street toward extremes of pessimism and risk aversion that will probably require new and scarier headlines to generate much further selling in the short term. In other words, to bet big on stocks here is to be a bad news bull: acknowledging that the economy and policy landscape have become tougher, but determining that stocks and bonds have sunk deep enough into a defensive crouch to price in most of it. Or at least that such a point is approaching. This is not to minimize the damage to the market or underplay its precarious condition. The nearly 7% drop in the S&P 500 since its April 30 high has been swift, even if it is well within the band of a routine pullback after a strong four-month rally. But the index performance somewhat masks the deterioration underneath. Close to one-fifth of all stocks are below their December lows, even though the S&P is up more than 15% since then. Over the past two weeks, on average close to 10% of S&P 500 stocks a day made a new 52-week low. And this selling squall is striking the market at a consequential point, the benchmark in a disputed zone between continuing uptrend and breakdown.

Multipeak top?

Not only has the S&P 500 slipped below its 200-day average — itself not much of a predictive event — but it has made no net progress for about 17 months, with some seeing a foreboding multipeak topping formation. The market was showing signs last week of finding its footing, perhaps as investors made their peace with the ongoing U.S.-China trade stalemate. Then came the Mexico news — which pushed markets further in the direction they were leaning: raising probabilities of recession, aggressively pricing in a Federal Reserve rate cut or two in coming months and curtailing risky bets in credit and equities. At this point, the story moves beyond the details of the trade tussles: After all, what beyond what has been imposed and threatened in these conflicts could further jar Wall Street in the immediate term? Now it’s about how much more significantly profit forecasts might have to be trimmed, whether the Fed will move in the direction markets have set out for it, and whether sentiment is yet plumbing extremes of negativity that can mean the selling of stocks is running its course. And, most crucial of all, whether trade frictions can be the decisive force that ends the economic expansion at its 10th anniversary.

‘Panic and capitulation’

“A reset of earnings expectations could help the equity market find a bottom, even without a final China trade deal, but that reset isn’t likely to happen until the next reporting season (mid July to mid August),” RBC Capital strategist Lori Calvasina said. “This waiting game, in the context of crowded conditions and expensive valuations in US equities, makes a 10% retracement (peak to trough) more likely.” Tim Hayes, chief global investment strategist at Ned Davis Research, said: “The markets have been warning to an increasing extent that the ongoing trade war will perpetuate the global slowdown with an increasingly negative impact on U.S. growth, as excessive complacency has been replaced by increasing pessimism and doubt about the justification for current earnings multiples.” He figures this process will culminate in a good opportunity to recommit to stocks in the second half of this year — but not until further signs of “panic and capitulation” arise, and some sort of policy response is in sight. Panic and capitulation are conditions identifiable only in rough terms and rarely with much precision or deft timing. But it’s becoming possible that sentiment has soured enough to allow for bounces before too long on little more than an absence of further ugly headlines. Here’s the S&P 500 plotted by MacroCharts against the difference between bullish readings on stocks and Treasurys in www.trading-futures.com’s widely followed Daily Sentiment Index of futures traders. This gap is on the verge of an extreme that’s coincided with decent trading lows since 2007, implying the massive outperformance of stocks versus bonds is growing spring-loaded for a reversal. Earnings forecasts have stagnated, which means the S&P 500 is only a bit cheaper than it was eight months ago at the September market high. But the collapse in bond yields has begun to flatten equity valuations.

Stocks vs. bonds


Company: cnbc, Activity: cnbc, Date: 2019-06-03  Authors: michael santoli
Keywords: news, cnbc, companies, stands, stock, 500, point, selling, market, stocks, pain, tariff, breakdown, sp, trade, today, sentiment, bonds, months, priced


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Goldman Sachs says these companies have the most to lose from Mexico tariffs

Traders work at Goldman Sachs booth on the floor of the New York Stock Exchange in New York. The market, already in turmoil amid the U.S.-China trade war, was hit by another bombshell last week — President Donald Trump’s threat to slap tariffs on all Mexican imports. For investors wary of their exposure to the new Mexico tariffs, here’s Goldman Sachs’ list of stocks to avoid. “…At least the first 5% tariff on imports from Mexico planned for June 10 will be implemented,” Snider said. “The combi


Traders work at Goldman Sachs booth on the floor of the New York Stock Exchange in New York. The market, already in turmoil amid the U.S.-China trade war, was hit by another bombshell last week — President Donald Trump’s threat to slap tariffs on all Mexican imports. For investors wary of their exposure to the new Mexico tariffs, here’s Goldman Sachs’ list of stocks to avoid. “…At least the first 5% tariff on imports from Mexico planned for June 10 will be implemented,” Snider said. “The combi
Goldman Sachs says these companies have the most to lose from Mexico tariffs Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-06-03  Authors: yun li
Keywords: news, cnbc, companies, tariffs, goldman, lose, companies, stocks, mexico, sachs, tariff, war, stock, trade, snider, imports


Goldman Sachs says these companies have the most to lose from Mexico tariffs

Traders work at Goldman Sachs booth on the floor of the New York Stock Exchange in New York.

The market, already in turmoil amid the U.S.-China trade war, was hit by another bombshell last week — President Donald Trump’s threat to slap tariffs on all Mexican imports. For investors wary of their exposure to the new Mexico tariffs, here’s Goldman Sachs’ list of stocks to avoid.

Goldman screened Russell 1000 index stocks by their assets explicitly reported in Mexico, revealing that chipmaker Skyworks Solutions, railroad company Kansas City Southern and sensor and electrical protection products manufacturer Sensata Technologies are among the companies most sensitive to the newly-proposed tariffs on Mexico imports.

The average stock on the list is already underperforming the broad Russell 1000 by 200 basis points, Goldman pointed out. Autos and auto components sector, which represent the largest U.S. import from Mexico, has suffered even more, lagging the broad market by nearly 300 basis points through Friday’s close.

“Escalation of the trade war poses a risk to both corporate profit margins and the health of the US consumer, who will likely absorb the majority of the tariffs via higher prices,” Ben Snider, an equity strategist at the bank, said in a note Friday.

Stocks took a big hit when Trump announced a 5% tariff on all Mexican imports from June 10. The White House said the duties could go up to 25% by October if Mexico does not take action to “reduce or eliminate the number of illegal aliens” crossing into the U.S.

Goldman’s economists believe the U.S. will follow through with at least the 5% tariff.

“…At least the first 5% tariff on imports from Mexico planned for June 10 will be implemented,” Snider said. “The combination of proposed tariffs on China and Mexico imports would result in roughly 80% of some U.S. imported products being subjected to tariffs, including toys, cell phones, and other consumer electronics.”


Company: cnbc, Activity: cnbc, Date: 2019-06-03  Authors: yun li
Keywords: news, cnbc, companies, tariffs, goldman, lose, companies, stocks, mexico, sachs, tariff, war, stock, trade, snider, imports


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Mexico tariff threat pushes long-time market bull to reduce exposure to stocks

Long-time market bull Phil Orlando just cut his exposure to stocks. The Federated Investors chief equity market strategist cites President Donald Trump’s new threat to impose 5% tariffs on Mexico imports for the decision. Despite making the defensive move, Orlando contends U.S. economic fundamentals remain solid, and they should ultimately support stocks. “When it does get resolved, I think the market is going to move on a dime,” said Orlando. According to Orlando, investors should brace for mar


Long-time market bull Phil Orlando just cut his exposure to stocks. The Federated Investors chief equity market strategist cites President Donald Trump’s new threat to impose 5% tariffs on Mexico imports for the decision. Despite making the defensive move, Orlando contends U.S. economic fundamentals remain solid, and they should ultimately support stocks. “When it does get resolved, I think the market is going to move on a dime,” said Orlando. According to Orlando, investors should brace for mar
Mexico tariff threat pushes long-time market bull to reduce exposure to stocks Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-31  Authors: stephanie landsman
Keywords: news, cnbc, companies, bull, market, longtime, fridays, uncertainty, tariff, reduce, sp, equity, orlando, portfolio, investors, trade, exposure, stocks, pushes, mexico, threat


Mexico tariff threat pushes long-time market bull to reduce exposure to stocks

Long-time market bull Phil Orlando just cut his exposure to stocks.

The Federated Investors chief equity market strategist cites President Donald Trump’s new threat to impose 5% tariffs on Mexico imports for the decision.

“In light of this growing uncertainty and expanded downside risk, we opted to pull in our horns a bit this morning, and we lowered our 8% equity overweight in our PRISM asset allocation moderate growth portfolio to 5%,” Orlando wrote in Friday’s commentary. “We added the 3% into our cash overweight.”

Despite making the defensive move, Orlando contends U.S. economic fundamentals remain solid, and they should ultimately support stocks. It’s a sentiment he echoed during Thursday’s interview on the ongoing U.S.-China trade war on CNBC’s “Futures Now. ”

“When it does get resolved, I think the market is going to move on a dime,” said Orlando.

Orlando estimates the S&P 500 could fall as low as 2,650, a 4% decline from current levels due to the uncertainty. That would reflect a 10% drop from the index’s all-time high hit on May 1.

According to Orlando, investors should brace for market swings through at least this month. He believes the stocks won’t regain their footing unless the trade tensions get resolved.

“Be patient. Take a deep breath and have some diversification in the portfolio,” added Orlando.

Barring a failed trade negotiations on both fronts, Orlando still thinks the S&P 500 will reach his year-end target of 3,100, a 13% jump from Friday’s close.


Company: cnbc, Activity: cnbc, Date: 2019-05-31  Authors: stephanie landsman
Keywords: news, cnbc, companies, bull, market, longtime, fridays, uncertainty, tariff, reduce, sp, equity, orlando, portfolio, investors, trade, exposure, stocks, pushes, mexico, threat


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