Here's our summary of key events ovenight that affect New Zealand, with news that the trade fears seem to have evaporated today.
On Wall Street, stocks have rebounded as investor jitters over restrictive trade policies around the world moderated. The S&P500 is up +1.5% so far in today's session.
And China is rallying WTO members to reject the US approach to settling trade disputes. However, China is also accelerating moves to open up its financial and services markets, and is easing the way to buy more US semiconductor products.
Markets are betting the trade rift between the US and China will be mended quickly and that the US is all bark and no bite.
In New York, the outgoing head of the New York Fed says he wants to see banks required to adopt pay plans for senior managers that discourage excessive risk-taking and place greater onus on them for wrongdoing. In fact, he wants most of the long-term compensation deferred, and paid in loss absorbing capital instruments. (And it seems likely that the next head of the important NY Fed will be John Williams, the current head of the San Francisco Fed.)
The Dallas Fed is reporting a sharp drop in the pace of business in their region. But the Chicago Fed national survey is seeing a rise in activity.
One of America's oldest and largest gun makers, Remington, has filed for bankruptcy protection. It has been hard hit by slumping sales and future prospects look bleak.
In Beijing and the country's north-east generally, they are under a major smog alert, the third of 2018. Trucks have been ordered off the road.
China needs more water so it is testing cutting-edge defense technology to develop a powerful yet relatively low-cost weather modification system to bring substantially more rain to the Tibetan plateau, Asia’s biggest freshwater reserve. The system, which involves an enormous network of fuel-burning chambers installed high up on the Tibetan mountains, could increase rainfall in the region by up to 10 billion cubic metres a year – about 7% of China’s total water consumption – according to researchers involved in the project.
In France, after ten years of trying, they posted a 2.6% public-debt-to-GDP ratio in 2017, the first time since 2007 it has been within the 3% limit set by the European Union.
The UST 10yr yield has firmed +3 bps overnight, back to 2.84%. But the Chinese 10yr is at 3.74% (down -2 bps) and the New Zealand equivalent is at 2.81% (down -3 bps).
The gold price is up another +US$7 in New York today and now at US$1,354/oz.
Oil prices have slipped slightly with the US benchmark now just over US$65.50 and the Brent benchmark just over US$70/bbl.
The Kiwi dollar will start today at 73 USc,or more than ½c higher over the past 24 hours. On the cross rates we are still at 94 AUc and at 58.6 euro cents. That puts the TWI-5 at 73.8 and a one-week high.
Bitcoin is down sharply at US$7,890 which is -7.5% lower than this time yesterday.
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