Global equities are extending their recent gains while bonds remain on the defensive. The is firm. There is a degree of optimism that is prevailing. There are some more overtures in terms of US-Chinese trade. In Hong Kong, developers and banks led an equity rally on ideas that the political tensions may ease. South Korea reported better trade data for the first ten days of September. Italy’s Conte survived a second vote of confidence yesterday, putting a new government in place. With new appointments to the EC, the risk of an Italy-EU confrontation has been reduced.
Nearly all the equity markets in the Asia Pacific regions advanced but China. The ‘s rally was extended into the seventh session, and Korea’s has six-day advance in tow. Europe’s is up nearly 0.6% in late morning turnover and is up about 7.75% since mid-August. US shares are trading firmer, and the is drawing nearer 3000. Coming into today, it has gained about 5.8% since mid-August. Bonds remain under pressure, and benchmark yields are mostly 1-3 basis points higher. The dollar is firm against most major and emerging market currencies. Of note, the dollar reached new highs since last July against the yen, and after yesterday’s drubbing in the face of softer than expected inflation data, the has stabilized. is trying to snap a four-day drop, while crude is moving higher, recouping yesterday’s losses that ended its four-day advance.
As we noted previously, China reportedly offered as a sign of good faith to make some large purchases of US foodstuffs ahead of the face-to-face meeting sometime next month. We suspect that this reveals/confirms its animal protein and grain shortage. This was partly reflected in the jump in food prices reported yesterday. China announced further liberalization of its capital markets and abolishing