U.S. to Impose Tariffs on Another $16 Billion in Chinese Imports Penalties, which take effect Aug. 23, come on top of $34 billion imposed in July
(…) The list of products covered by the Aug. 23 tariffs reflects the Trump administration’s efforts to hold off imposing import taxes on goods that would hit consumers as long as possible. The list includes mainly industrial goods such as “lubricating oils,” “fittings of plastics, for plastic tubes, pipes, and hoses,” and “voltage and voltage-current regulators.” (…)
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China Retaliates With New Tariffs, Hunkering Down for Long Trade Fight Beijing warned it would match the Trump administration step for step should it move ahead with new tariffs on Chinese imports, as trade data showed the country is shoring up its economy for a long trade conflict with the U.S.
(…) State-run tabloid Global Times, in an opinion piece last week, warned that American brands including Apple Inc. are positioned to become Beijing’s bargaining chips in the trade battle.
“The Chinese market is vital for many top U.S. brands, giving Beijing more leeway to play hardball in the trade conflict,” it said. “If Apple wants to continue raking in enormous profits from the Chinese markets amid trade tensions, the company needs to do more to share the economic cake with local Chinese people.” (…)
Well, this is August 9 and there are no signs of any serious high level talks taking place behind the scene.
The consumer-price index increased 2.1% in July from a year earlier, compared with a 1.9% gain in June, the National Bureau of Statistics said.
Food prices rose 0.5% from a year earlier after climbing 0.3% in June. Pork prices, which has been the main drag, fell less sharply in July.
Nonfood prices rose 2.4% on year, compared with a 2.2% on-year increase in June. Gasoline and diesel prices surged by more than 20% on year, adding about 0.42 percentage point to the headline index, the bureau said. (…)
On a month-over-month basis, the CPI rose 0.3% in July from a month earlier. In June, the index edged down 0.1% from the previous month.
The producer-price index rose 4.6% in July, compared with a 4.7 % on-year increase in June. The reading for factory-gate prices was higher than a 4.4% increase forecast by economists polled in the survey.
The PPI inched up 0.1% in July from a month earlier. In June, it edged up 0.3% from the preceding month.
FAKE OIL
Discrepancy Over Saudi Oil Data Could Rattle Markets Saudi Arabia has pressured independent energy analysts to alter their estimates of its oil production, a move that could put it in conflict with other OPEC members.
(…) The data showing differing trends between official and independent estimates of Saudi output is set to be published Monday in the cartel’s monthly report, potentially causing confusion in trading markets about how much oil is reaching consumers. (…)
The kingdom has called some agencies over the last week, asking that analysts change their estimates, according to people familiar with the discussions. Some agencies rebuffed the request but others bowed to the pressure, they said. (…)
Saudi officials told OPEC delegates last weekend that the kingdom’s production had fallen by 200,000 barrels to 10.29 million barrels a day in July, according to energy ministry officials. Oil prices rose 1.6% in New York Monday.
But according to New York-based S&P Global Platts, a provider of energy information, Saudi production increased to about 10.6 million barrels a day last month. The Energy Information Administration, a branch of the U.S. Department of Energy, arrived at the same estimate. (…)
The agencies use contacts in governments, storage information and ship-tracking data to provide what tends to be reliable data on the kingdom. With their data, “there is no agenda, there is no ulterior motive,” Mr. Hall said. (…)
The lack of consensus extends to the kingdom itself. A Saudi oil official and an adviser said they were told privately the country’s production is higher than the official figures. (…)
But Saudi officials say discrepancies over the kingdom’s production reflect dueling political pressures from the U.S. and Iran. The U.S., concerned about rising fuel prices, wants Saudi Arabia to replace Iranian oil because it is about to ban Tehran’s crude exports under revived sanctions.
Iran has criticized Saudi Arabia for increasing output, alleging it’s a way to respond to U.S. pressure rather than market needs. (…)
Iraq, OPEC’s second largest producer, is also disputing independent assessments showing it only respected 12% of its agreed cuts in June. “We are going to refuse these figures,” Iraq’s State Oil Marketing Organization said in a letter to at least three independent agencies earlier this month.
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Saudis Order Fund Managers to Dump Canadian Assets Saudi Arabia is ordering its citizens to leave Canada, selling its financial assets there and freezing trade between the two countries as part of a diplomatic spat that has highlighted the kingdom’s extreme sensitivity to criticism.
EARNINGS WATCH
440 S&P 500 companies have reported. 79% beat, +5.2% surprise factor with 9 of 11 sectors surprising by more than +5%!
Q2 EPS now seen up 24.1%, after +26.6% in Q1.
Here’s the rub: only 27 companies have positively pre-announced for Q3, down from 34 and 33 at the same time during Q3’17 and Q2’18 respectively. 58.3% have negatively pre-announced, up from 55.2% and 48.1% respectively. During the last 7 days, 1 positive and 14 negatives.
This sure looks like one of very few times when it is just as dangerous using trailing earnings as forward earnings.
WORLD AND SECTORS MOVING AVERAGES
Trends in 200 dmas for major world and U.S. sectors. Green = positive trends (softer green = weak positive). Sorry for color blinds.
TRENDS IN 200-DAY MOVING AVERAGES
This Week’s Elections Hold Warning Signs for GOP The elections held in five states underscored the Republican Party’s growing challenges with suburban voters, which could expand the battlefield in November’s midterms.
(…) According to an analysis from the Cook Political Report Wednesday, there are 68 GOP-held seats that are less solidly Republican than the Ohio 12th. Democrats must net 23 seats to gain control of the House in November. (…)