logo-loader

China to Unveil Plan to Make Macau Finance Hub, Reuters Says

The policies include establishing a yuan-denominated stock exchange, accelerating a yuan settlement center which is currently being developed and allocating land for Macau, Reuters said, citing unidentified government officials and company executives.

UBS Group AG - China to Unveil Plan to Make Macau Finance Hub, Reuters Says

Your free daily email from Fuller Treacy Money

Comments of the Day

13 December 2019

 

Video Commentary for December 12th 2019

 

Eoin Treacy's view

A link to today's video commentary is posted in the Subscriber's Area. 

Some of the topics discussed include: trade war potentially close to at least a partial conclusion, Wall Street breaks out led by banks and semiconductors, German wages acceleratng well ahead of growth and interest rates, Dollar testing support against a host of currencies, bonds weak across the board, Pound off its intraday lows in advance of the election result. 

 

 

U.S. Reaches In-Principle China Deal, Awaits Trump Signoff

This article by  Jenny Leonard, Shawn Donnan and Saleha Mohsin for Bloomberg may be of interest to subscribers. Here is a section:

U.S. negotiators have reached the terms of a phase-one trade deal with China that now awaits President Donald Trump’s approval, according to people briefed on the plans.

Trade advisers were set to meet with the president at 2:30 p.m. to discuss the agreement. An announcement could come by day’s end, the people said. A White House spokesperson declined to comment.

The terms have been agreed but the legal text has not yet been finalized, according to the people. The administration has reached out to allies on Capitol Hill and in the business community to issue statements of support once the announcement is made, they said.

U.S. stocks rose and Treasury yields spiked on the news. Earlier Thursday, Trump tweeted that the U.S. and China are “VERY close” to signing a “BIG” trade deal, also sending equities higher.

“They want it, and so do we!” he tweeted five minutes after equity markets opened in New York, sending stocks to new records.

 

Eoin Treacy's view

Nothing seems to animate traders more than trade related tweets at present. Every negative sentiment is greeted with a couple of percent sell-off and every positive utterance is greeted with a bounce. The broad picture is the Chinese economy is slowing and the administration has been priming the populace for harder times ahead. Meanwhile the US economy is strong, but business confidence is weak. The Chinese and US businesses have a clear interest in a deal that removes barriers to trade but the Trump administration also wants to get to 2020 election without a recession. That puts the odds of a deal closer to fruition that any other argument.

 

 

China to Unveil Plan to Make Macau Finance Hub, Reuters Says

This article by Jihye Lee and Jinshan Hong for Bloomberg may be of interest to subscribers. Here is a section:

The policies include establishing a yuan-denominated stock exchange, accelerating a yuan settlement center which is currently being developed and allocating land for Macau, Reuters said, citing unidentified government officials and company executives. The measures were intended to mark the 20th anniversary of the former Portuguese colony’s return to Chinese rule, an event that will bring Xi to Macau, the report said.

The bourse would focus on bond trading first to encourage local and mainland companies to issue debt in the city, Reuters said. The exchange would also focus on startups and target companies from Portuguese-speaking countries to avoid direct competition with Hong Kong or Shenzhen, it reported, citing six Macau executives and Chinese officials.

Xi will also announce Macau’s decision to join the Beijing-based Asian Infrastructure Investment Bank. Future priorities will include tourism and finance, and for Macau to be used as venue to host international meetings like Singapore, an official told Reuters.

 

Eoin Treacy's view

This is a none too subtle signal to Hong Kong that unless it gets its act together there is clear intention to excise the city from the broader plan to create a unified coastal economy which is to include Macau, Shenzhen and Guangzhou. The problem is that today some effort to offset reliance on Hong Kong’s dominance of the financial services sector is largely inevitable regardless of what happens because evidence of disruption is already in existence.

 

 

SNB's Jordan Defends Negative Rate Policy as Criticism Mounts

This article by Catherine Bosley and Jan Dahinten for Bloomberg may be of interest to subscribers. Here is a section:

Lenders in Switzerland and elsewhere say margins are under pressure. The Swiss Bankers Association has argued negative rates are no longer necessary, and a survey by UBS Group AG found that even export-oriented firms believed the policy was doing more harm than good.

Jordan spoke after the SNB left interest rates unchanged and reiterated its threat to intervene in currency markets if needed. He acknowledged the “challenges” of its subzero policy, but offered no sign he’s about to change tack anytime soon.

“We monitor the impact of negative interest precisely, and we take the side effects seriously. However, we remain convinced that the benefits it brings Switzerland as a whole clearly outweigh the costs. The negative interest rate and the willingness to intervene are currently the best instruments.”

The SNB’s latest forecasts bear out his concerns. Similar to their peers, Swiss policy makers have struggled to stoke price pressures, though their situation is complicated by the currency. They’ve long described the franc as “highly valued,” a key phrase they repeated on Thursday.

 

Eoin Treacy's view

Negative interest rates are something Switzerland experimented with during the gold bull market of the 1970s as a measure to try and keep the value of the currency under control. Today they are doing the same thing but instead of the Franc being backed by gold it is supported by the cashflows of some of the world’s largest companies.

 

 

Eoin's personal portfolio: precious metals long increased December 11th

 

Eoin Treacy's view

One of the most commonly asked questions by subscribers is how to find details of my open traders. In an effort to make it easier I will simply repost the latest summary daily until there is a change. I'll change the title to the date of publication of new details so you will know when the information was provided.

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Cabral Gold sees positive drill results on Cuiu Cuiu in Brazil

Cabral Gold (CVE: CBR) President and CEO Alan Carter sat down with Steve Darling from Proactive Vancouver to discuss their latest drill results on the MG deposit. Carter going through the numbers with us. Carter also told Proactive why these results have given them a new and interesting way...

11 minutes ago

5 min read