Global stocks are declining on Friday under the quadruple weight of 1.) reduced expectations for a December rate cut (due to hawkish Fed comments), 2.) opaque scheduling for backlogged U.S. economic reports, 3.) mounting worries about an AI bubble, and 4.) unexpectedly weak Chinese economic data: slowest industrial output since Aug. ’24 (+4.9% in Oct. vs. +5.5% est. & +6.5% in Sept.) and a 1.7% decline in fixed asset investment (along with -0.5% Sept. print the only two non-Covid negative prints since records began in ‘98).
Responding to the Democrat rallying cry of fading “affordability” (which contributed to the string of Democrat election victories on 11/4), President Trump announced a series of new trade deals with Argentina, Guatemala, El Salvador and Ecuador to reduce tariffs and barriers on common grocery items like beef, bananas and coffee beans. Separately, the Trump administration is studying broad sectoral tariff exemptions for popular food products.
Bloomberg reports Argentine President Javier Milei will modify regulations protecting Andean glaciers to unlock tens of billions of dollars of copper and lithium mining projects (most notably Glencore’s El Pachon). Milei plans to send the regulatory changes to Congress for approval or may simply make the changes via decree.
The European Parliament approved the EU’s plans to cut greenhouse gas emissions by 90% of 1990 levels by 2040. Carbon emissions are down 35% since 1990 levels (BP World energy stats) and therefore must fall another 85% from the present level (or 55% from the 1990 level) to meet the target. Assuming the “easy” cuts have already been made, this process will get a lot more painful. European energy policy continues to drive EU deindustrialization.
White House economic advisor Kevin Hassett announced a complete September jobs report (originally due 10/3) will be released next week, but the October jobs report (originally due 11/7 & timing still uncertain) will be released without an unemployment rate (household survey was not conducted during shutdown).
Following the S&P 500’s 1.66% decline on Thursday, Euro Stoxx 50 -1.8%, China’s CSI 300 -1.1%, Nikkei 225 -1.0%, S&P futures -0.8% and Nasdaq futures -1.3%.
Sign up for our newsletter at the bottom of our homepage wealthion.com
