A Chinese fighter jet is making noise. Covid restrictions will be rolled back by Beijing. The US is considering removing tariffs. Today is what you need to know.
It may make sense to lift tariffs on some goods as a way to tame the hottest inflation in almost four decades, according to the president's commerce chief. The administration is looking at the possibility of lifting duties on other goods imposed by Donald Trump. As the US prepares to ban all goods from the remote Chinese region of Xinjiang over human rights abuses, the leader of the country is trying to unify it with the rest of China.
The central bank is expected to raise interest rates for the first time in 12 years on Tuesday. How much? The Reserve Bank of Australia began raising interest rates in May following a sharp increase in inflation. The tag given to everyone who expected the price hikes to be short-lived still hasn't given up hope that the shock will soon fade. They warn that big rate hikes are not a good idea.
The US jobs report left the door open for the Federal Reserve to take a more aggressive stance on inflation, which could cause the US economy to fall into recession. The jobs report alleviated some concerns that the economy is slowing too fast, but it strengthened the view that the Fed will keep hiking rates.
After declaring at the end of last month that the latest outbreak of the virus was under control, Beijing will roll back its restrictions on Monday. The city will allow workers to return to their offices and restaurants after a week without new community cases. The number of Covid infections in Hong Kong increased on Sunday. There had been no change in the number of hospitalizations.
According to Australia, a Chinese fighter jet cut off one of its planes in the South China Sea. The Department of Defence said in a statement that a dangerous maneuver posed a safety threat to the P-8 and its crew after it was intercepted by a J-16 fighter aircraft. The Australian aircraft and crew were in danger after the J-16 fighter flew very close to the P-8 aircraft.
Today's stock market leading indicators have something for everyone in the audience. Semiconductor, small caps and transport shares show a mixed picture of performance, suggesting choppy trading is likely to continue. Useful measures of direction in the stock market can be found in all three cohort. They rolled over at the same time as the stock market fell. The bulls will be happy to see semi stocks break out of their year-to-date downtrend, as anecdotal evidence shows the chip crunch is easing.
The case for bears will be strengthened by the fact that small caps are not only sensitive to economic growth concerns but also worry about liquidity and volatility. Transport shares are a leading indicator of the broader market. The gauge reflects the mixed feelings in the global stock market with investors unwilling to bet big on a return to fresh lows.
Cormac is a deputy managing editor in the markets team.
Cormac Mullen assisted.
All Rights Reserved © 2024
