So what is the verdict from Comey’s historic testimony?
It depends on who you ask: turning to CNN, reading the NYT or WaPo, or any source of left-leaning news, and virtually every commentator will be certain that Trump’s political career has been terminally truncated as a result of today’s events. Alternatively, and inversely, the right will claim the opposite: Comey failed to do any damage to the president, the Russian collusion narrative is now over, and that it is Comey’s own actions that should be probed.
Both are to be expected.
But what about the reaction by an impartial arbiter such as the market? Conveiently, that’s what PredictIt is for, and as the chart below shows, Trump’s 2017 impeachment odds dropped by 4 points, from 21% to 17%, following Comey’s testimony.
Group of Seven leaders on Saturday managed to project a united front in fighting protectionism as they closed a two-day annual meeting here. But the meeting also highlighted a divide between the U.S. and the four European countries in the group.
In the joint communique released after the meeting, the leaders reiterated their commitment “to fight protectionism.” This wording was initially opposed by the U.S. But the “to fight protectionism” phrase is followed by a comma, and the rest of the sentence goes on to say, “while standing firm against all unfair trade practices.”
It is believed the wording was added at the behest of the U.S.
their “strong commitment to swiftly implement the Paris Agreement.”
The communique also notes North Korea’s “new levels of threat of a grave nature to international peace and stability.”
In a separate statement, the leaders condemned Monday’s suicide bombing in Manchester and called for reinforcing anti-terrorist measures, including the involvement of internet service providers in counter-terrorism operations.
What sell-off? In a feat that has not been accomplished in more than a week, the S&P 500 on Wednesday notched a fresh record closing high.
The S&P 500 gained 0.25 per cent to 2,404, the Dow Jones Industrial Average added 0.36 per cent to 21,012.4, and the Nasdaq Composite gained 0.44 per cent to 6,163.
Last week, equities markets took a blow from rising concern over the political fortunes of US President Donald Trump.
The former businessman’s election last year helped stoke sharp gains for equities on expectations that his policies will support corporate America. That enthusiasm has ebbed and flowed as Mr Trump has struggled to dig-out of numerous scandals.
Still, after Wednesday’s gains, the most recent bout of selling has been entirely reversed and then some. The S&P 500 index is up 7.4 per cent for the year.
Investors on Wednesday parsed through minutes from the Federal Reserve’s May meeting, which set the table for next month’s meeting, which could see it raise rates for the second time this year. Investors interpreted the news as dovish on margin, however, with the US dollar slipping 0.26 per cent against a basket of six peers.
The yield on the benchmark 10-year Treasury note fell 0.0298 per cent to 2.2502 per cent.
Investors will keep a close eye on US politics next week as US President Donald Trump’s first foreign trip coincides with a growing White House scandal at home.
Here’s what to watch in the coming days.
Donald Trump kicks off his first overseas visit since becoming US president by travelling to Saudi Arabia at the invitation of Saudi King Salman bin Abdulaziz this weekend. Mr Trump is set to agree to a $10bn weapons sale to Saudi Arabia as the US seeks to boost business and diplomatic ties with Riyadh.
The nine-day tour will also see Mr Trump visit Israel and continue on to Rome before heading to a Nato summit in Brussels. The meeting comes as the president’s attempts to give Nato a more formal role in the anti-Isis coalition has faced resistance from France and Germany. Mr Trump will also attend a G-7 meeting in Sicily.
The overseas trip comes with Mr Trump under siege at home following revelations that he pressed James Comey, the FBI director who was abruptly dismissed last week, to drop a probe into the Trump administration’s ties with Russia. Mr Comey has been invited to testify before Congress on Wednesday.
Further complicating matters, new Russia claims were published just after Mr Trump departed Washington on Friday, casting more clouds over the trip even as it got underway.
After yesterday’s violent gap up in stocks across the globe in response to the “expected” outcome from the French election, today the risk on sentiment has continued if to a lesser extent, with stocks in Europe, Asia all rising while S&P futures point to a higher open. Yen, gold decline, while the euro traded as high as 1.09 this morning before fading some gains; oil is up modestly.
While today’s surge may have been more muted, world stocks hit a new record high on Tuesday, with investors still cheering Macron’s victory in the first round of the French presidential election, supported by speculation about U.S. tax reform and the overnight report that Trump has conceded on the border wall, eliminating a government shutdown as a potential risk. As shown below, the MSCI All World Index has jumped to a new all time high, boosted by strong Asian markets.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.6%, hovering near its highest level since June 2015 hit earlier in the session, on its fourth straight day of gains. Japan’s Nikkei rose more than 1 percent to a three-week high aided by a weaker yen. South Korea’s also advanced 0.7 percent to its highest level since April 2015. China equities climbed from a three-month low on speculation that a selloff over concerns of a regulatory crackdown were overdone. Australia and New Zealand were closed for Anzac Day.
European stocks hovered near a 20-month high, with the Dax flirting with all time highs. The Stoxx Europe 600 index edged 0.2% higher after jumpin 2.1% on Monday to the highest since August 2015, with property and technology shares helping to underpin a global rally. French shares pulled back 0.1 percent, having risen 4.1 percent on Monday in their biggest daily gain since August 2012. Futures on the S&P 500 added 0.1 percent. The index climbed 1.1% Monday to within 1% of its all-time closing high.
These gains helped push MSCI’s world stocks index to a fresh all-time high after chalking up its biggest rise since shortly after Britain’s vote last June to leave the European Union.
Former RBI governor Raghuram Rajan today warned of “policy uncertainty” for the world economy due to there being a “bunch of new leaders” who need to prove they are strong, even as he exuded confidence about all large economies doing well. Without specifically mentioning India, Rajan said, “This is the first time in a long while we have seen all the big engines firing at the same time including the large emerging markets … We have seen trade picking up. “We are seeing early signs of investment intentions. Of course there are always clouds. There are clouds this time also,” he said. In an interview to CNBC, the Chicago Booth School professor and the outspoken economist also said the “good news is some of the fears about the (Trump) administration that it would move immediately to a more protectionist stance haven’t played out”.
“There have been noises but of course the strong action that some people feared against Mexico, against China hasn’t really materialised. That’s the good news,” he said while referring to Donald Trump administration in the US. Talking about the possible risks before the world economy, Rajan who served as RBI governor for three years, said, “There is lot of policy uncertainty right now because of the work the (US) administration is going to do and how much it can achieve.
“But also there is geo-political risk. We have a bunch of strong leaders around the world who are already well entrenched in their strength. “We have a bunch of new leaders who need to prove themselves that they are strong. And in that kind of environment, who has room to back off if in fact there is a confrontation. We have many areas of confrontation.” Rajan further said as the US monetary policy normalises, “we will see more stress” on heavily indebted entities.
With ‘Never-Trump’-ers still convinced he is Hitler and ‘Trump’-ers questioning their reality at his recent flip-floppery, many in the country are asking why should we support this President (even as his approval ratings rise with each warmongering threat). Well there is a simple – and perhaps greedy – reason… the world’s debt and equity markets have gained over $8 trillion since his election and a loss of faith now may leave some big holes.
The value of world equity market capitalization and debt values reached a new record high today of $118 trillion.
This is a more than $8 trillion rise since Donald Trump was elected President and unleashed animal spirits around the world. For someone who has yet to actually put any reforms, stimulus, cuts, laws, into practice – not bad going!
The gains are all concentrated in the ever-hopeful global equity markets…
“I like a low interest rate policy, I must be honest with you,” Donald Trump told the Wall St Journal yesterday. His comments have further fired up already strong US government bonds, with the effects spilling over into European debt this morning. Like their US counterparts, German 10-year bond prices are now around their strongest point of the year.
Mr Trump’s new comments are not the only weight on global bond yields. Among other things, geopolitical nerves and the failure of his healthcare plans have also imposed a longer-term weight.
Still, 10-year Bund yields have sunk by 0.02 percentage points so far today to 0.175 per cent. (Yields fall when prices rise.) That’s the strongest level for Bunds since late December.
US yields, which exert a strong gravitational pull on other core markets, now stand at 2.32 per cent, the lowest since mid-November.
The primary goal of Chinese President Xi Jinping in the first face-to-face meeting with his U.S. counterpart, Donald Trump, was to seek a new beginning for his “major powers” initiative. But he got off to a rather rocky start; the summit was overshadowed by a series of unexpected events.
On Thursday night, Xi and his wife arrived at Trump’s Mar-a-Lago resort in an already summery Florida, where daytime temperatures reach 30 C. During the dinner, the couple enjoyed listening to Trump’s granddaughters singing Chinese folk songs and reciting poems from China’s Tang dynasty.
As they were enjoying the entertainment, U.S. forces were bombing Syria. It was only toward the end of dinner that Trump told Xi about the operation.
Xi must have felt quite awkward. He might have felt completely taken in by Trump. Xi was right next to the commander in chief who had just ordered a bombing campaign in a politically sensitive region of the world, happily smiling and talking without knowing anything about the assault.
The timing of the missile attack was carefully calibrated. Just before meeting with Xi, Trump suggested the U.S. might engage in unilateral military action against North Korea, which had launched a ballistic missile days before the U.S.-China summit. The bombing of Syria — and the campaign’s timing — was apparently intended to pressure China, which is reluctant to cooperate with the U.S. in dissuading Pyongyang from pursuing missile and nuclear weapons programs.
Wall Street failed to hang on to its modest gains on Friday as escalating tensions between the US and Russia over President Donald Trump’s surprise airstrike on Syria weighed on investor sentiment.
The S&P 500 gave up gains of as much as 0.3 per cent to end the day 0.1 per cent lower at 2,355.54. For the week, the index is down 0.3 per cent.
It’s a similar story for the Dow Jones Industrial Average, which closed largely unchanged for the day, as well as for the week at 20.656.10, after having advanced as much as 0.3 per cent earlier on Friday.
The technology-heavy Nasdaq Composite also ended the day flat at 5,877.81 after reaching a session high of 5,892.06.
Stocks had a choppy Friday, with the major indices swinging between minor losses and gains as the markets weighed a weaker-than-expected March jobs report against Mr Trump’s latest foreign-policy shift and a terror attack in Stockholm.