Global Stocks Soar On Chinese Economic Optimism
'(of course they do because over $10 trillion worth of debt has a negative yield, among other issues that do not matter in welcome to the thunderdome style of reality for Wall street.)
Over the weekend China reported a key inflection point in its manufacturing PMI , which had its first expansionary print in 5 months, and the market saw right through this attempt to generate optimism that global economic headwinds are finally abating, and promptly sold off.
Just kidding, April fools!
(algo-driven trading does not have a sense of humor apparently as all it does it react to generated headlines to force the issue of which direction the mkt heads-moar on this at a later date, still working on some material for that)
As happens every single time, global stocks surged higher on Monday, extending gains from their best quarter in nearly 10 years, as algos and traders dutifully ignored the fact that every single number out of China is carefully goal-seeked and politically motivated - in this case meant to shift the trade war balance of power in favor of China whose economy is now on the rebound despite the ongoing US tariffs - and overnight global markets were a sea of green as "Chinese economic optimism" is now the dominant narrative, taking over from "US-China trade talk optimism."
As we reported previously, on Sunday China's NBS said that the country's manufacturing PMI rebounded strongly in March from a contractionary 49.2, printing at 50.5, its first expansion since September 2018, and beating estimates of a 49.6 reading. The non-manufacturing PMI continued its recent improvement, rising to 54.8, also the best reading since last September, as both the services and construction PMIs strengthened, and resulted in the composite PMI rising to 54.0 from 52.4. Predictably, Asian stocks, European bourses and S&P 500 futures all jumped as traders woke up to news of "strong manufacturing data" out of the world’s second largest economy which helped ease investor worries about a slowdown in global growth.
Asian optimism quickly went global as European stocks posted their best daily gains since mid-February, as the pan-European STOXX 600 index surged 0.8% in early trading. Germany’s trade-sensitive DAX outperformed with a 1 percent rise helped by gains in auto maker stocks as European car-makers advanced more than 2 percent. That’s despite manufacturing data for Europe coming in at the lowest since 2013, which briefly caused the euro to pare some of its gains.
(the stupid continues to burn as it is important to remember the word bifurcation…that is what continues to habben in the world's mkts.)
Treasury 10-year yield climbed as much as 4bps to 2.4475%; Risk-sensitive currencies lead gains in the G-10, while the yen drops; Antipodean and Scandinavian currencies gain along with China’s yuan as Chinese Vice Premier Liu He scheduled to lead a delegation of trade negotiators to Washington on Wednesday after officials held talks in Beijing. The yen declined, while the Turkish lira slipped initially as preliminary results from the weekend’s municipal elections showed that Turkey opposition party claimed victory in Istanbul and Ankara, while the ruling AK Party also initially claimed to have won in Istanbul following local elections over the weekend which was seen as a referendum on President Erdogan. However. President Erdogan later commented that although the Mayorship may have been lost in Istanbul, they won in many of its municipalities; the lira initially slumped lower before it exploded higher after it emerged that Turkey is once again cracking down on shorts as the overnight swap rate surged to 260%.
In commodities, oil prices rose*-see below for Saudi Aramco News last night-, adding to gains in the first quarter when the major benchmarks posted their biggest increases in nearly a decade, as concerns about supplies outweigh fears of a slowing global economy. Crude oil prices added to Friday’s gains, with U.S. West Texas Intermediate futures gaining 0.9 percent to $60.69 per barrel. Brent was 1.3 percent higher at $68.46 per barrel.
Economic data include retail sales, ISM manufacturing, construction spending and business inventories.
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Aramco eclipses top earner Apple ahead of debut $10 billion-plus bond sale
https://www.marketscreener.com/SAUDI-BASIC-INDUSTRIES-CO-6493058/news/Aramco-eclipses-top-earner-Apple-ahead-of-debut-10-billion-plus-bond-sale-28329681/?countview=0
https://www.zerohedge.com/news/2019-04-01/global-stocks-soar-chinese-economic-optimism
There is also much in the way of economic number's coming.
Please see here (it still starts with last week's activity but just scroll down)
https://www.marketwatch.com/tools/calendars/economic
https://www.bloomberg.com/markets/stocks/futures
https://www.dailyfx.com/crude-oil