D-PIMS Weekly Market Update - Week of 2nd to 8th December 2019
Today’s Monday Update:
Last week the Markets were mainly focusing on the NATO Summit and any election news:
• On Monday, possibly bored with his China ‘Trade War’, Donald Trump made a sudden announcement of immediate Tariffs on Steel & Aluminium imports from both Brazil & Argentina. This took the two South American countries by surprise, and the also the Markets. He gave no explanation.
• Hot on the heels of the south American tariff attack, on Tuesday Trump raised the possibility of 100% tariffs on French Champagne, Cheese, Handbags and other French goods (£1.9 billion of French imports). He blamed France’s new Digital Services Tax, saying it would harm US companies.
Trump added further to poor Market sentiment by saying “a trade deal with China could be delayed until after the next U.S. presidential election”. This also caused oil prices to fall.
• On Wednesday, the NATO Summit ended with seemingly little progress and Trump left without attending the usual press conference. This was after widespread reports that other leaders were making fun of him!
• Thursday saw four Brexit Party MEPs resign and join the Conservative Party. As they do not hold seats in the UK Parliament this was largely a symbolic gesture, but it could sway Brexit Party supporters in the December 12th UK Election.
• After a week of adding to Trade tensions, Trump eased them slightly on Friday by commenting that trade talks with China were ”moving right along”. China also helped by stating that it will waive import tariffs for some soybeans and pork shipments from the United States, as a gesture of goodwill. Markets were also encouraged by the latest US jobs figure coming in much higher than expected, at an extra 266,000 jobs in November. This was the biggest increase in jobs for 10 months and helped allay fears of a slowing US economy.
Also on Friday, the US Labour Department’s closely watched monthly employment report showed steady wage gains and the unemployment rate falling back to 3.5%, in the US.
• Over the week the world’s Stockmarkets were mainly down (in Sterling terms) and the D-PIMS Portfolios followed suit, although the picture improved a little on Friday with better sentiment hopefully following through into the coming week.
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The comments made above represent our interpretation of events and market views and are in no way a guarantee of future investment performance.