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Good morning. The week rolls on towards several big events as hopes for a U.S.-China trade deal remain, the U.K. election zeroes in on the key issues and impeachment looms. Here’s what’s moving markets.
The clock ticks down another day towards the imposition of new tariffs on Chinese goods by the U.S. this weekend, though Chinese officials continue to express hope that a good deal will be reached in time. President Donald Trump’s agriculture chief also thinks China will be spared the new tariffs as the round-the-clock talks continue. On another trade front, however, the Trump administration and House Democrats are moving closer to reaching a deal on the new NAFTA agreement.
Brexit and the NHS
The U.K. election campaign remains centered on the two issues that have been at the forefront throughout, Brexit and the National Health Service. Conservative leader Boris Johnson was put on the defensive by questions over a picture of a young boy lying atop clothes on a hospital floor, but his party remains firmly in the lead in the polls as we stare down the final days. For investors, the spotlight is on the pound, where investors are taking advantage of the low cost of betting on a rally and signals from technical indicators that have proved right in the past decade.
Bankers at two of the world's top firms will be experiencing very different festive seasons. Morgan Stanley is cutting around 1,500 jobs as part of a year-end cull, a familiar sight among investment banks dealing with a slowdown in activity in the past year. Barclays Plc, meanwhile, is promoting people to managing director as it goes against the grain by seeking to boost the size of its investment bank. All in the shadow of a major investment bank revamp at HSBC Holdings Plc.
U.S. House Democrats are planning to level two articles of impeachment at President Trump on Tuesday over abuse of power and obstruction, according to people familiar. The Democrats appear to be heading toward tightly drawn articles of impeachment and once done, the Democrat-controlled House is likely to vote to impeach before the Republican-led Senate likely votes to acquit. Expect plenty of back-and-forth between Trump and lawmakers before then.
Similar to Monday, Asian stocks remained in a holding pattern ahead of the Federal Reserve decision on Wednesday and, once again, European stock futures are providing little hint on the direction. A few pieces of salient data will arrive, including the ZEW survey of economic sentiment, industrial production for France and Italy and GDP numbers for the U.K. Earnings remain relatively thin on the ground, but we will have industrial equipment rental firm Ashtead Group Plc, often a good proxy for the health of the U.S. construction industry.
What We’ve Been Reading
This is what’s caught our eye over the past 24 hours.
Germany’s now Europe’s biggest electric car market. Gold’s been on a tear and that may continue in 2020. Golden Globe-nominated directors are very male this year. WeWork’s co-founder is considering selling his penthouse. The “Fangirls” defending China from Hong Kong protestors. The space junk cleanup is set to begin. Bloomberg’s Jealousy List of the stories we wish we’d done.
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