Morning 9-3

Usual Suspects causing the Risk Off sentiment so far today, Brexit, and China-U.S. trade tensions

  • China, U.S. Struggle to Set Meeting as Tariffs Erode Trust– Chinese and U.S. officials are struggling to agree on the schedule for a planned meeting this month to continue trade talks after Washington rejected Beijing’s request to delay tariffs that took effect over the weekend, according to people familiar with the discussions.
  • China concessions to US would be ‘grave error’ in any trade deal– Chinese state media and government advisers have said Beijing is in no rush for a trade deal, instead warning that any concessions made to the United States would be a grave error.
  • China takes US to WTO over tariffs, putting trade talks in jeopardy( Asia-Nikkei news) “The tariffs imposed by the United States severely violated the consensus reached by the two heads of state in Osaka,” the Commerce Ministry said in a statement reported by the official Xinhua News Agency. China is “extremely dissatisfied with and resolutely opposes” the tariffs, the ministry said….”China will firmly safeguard its own legitimate rights and interests and resolutely uphold the multilateral trading system as well as the international trade order,” the Commerce Ministry said.
  • Per Bloomberg Huawei Accusing Washington of a  “campaign to intimidate it workers and launching cyber-attacks to try an infiltrate its internet technology systems”

The British pound fell as much as 0.6% to 1.19 against the US dollar in early trading on Tuesday, the lowest since 2016, after Government official said that UK Prime Minister Johnson would call for a snap general election on October 14th if lawmakers succeed with a legislative bill to block a no-deal Brexit, forcing to delay Brexit departure date. (ITC markets)

Spoos recovering a good chunk of overnight loses but still down 22 handles -.75%, Nasdaq -.8% European Stocks Lower Dax -.3 % cac -.5%  LME copper -1.8%, as all base metals trading in the red. Gold, Silver and Platinum along with bonds and bunds all higher as a flight to quality /safety trade is taking place. Dollar index up for the 5th  consecutive day and trading at 2 + year highs as we know president trump will not like this .Gilts at one point were +100 ticks as Brexit panic caught hold but the panic has subsided as they trade higher by 44 ticks Oil -2% as it follows the risk off

Positive news:

Italian 10-Year Yield Hits New Low on Coalition Deal

Italy’s 10-year bond yield declined to a fresh record low of 0.924% on Tuesday, amid optimism ahead of an online ballot by 5-Star members to decide on a coalition deal with 

New Month and a new round of US economic data to determine trade war Impact and obviously the strength of US economy ISM today and Unemployment Friday are the highlights for the week. Central bank Meeting this month will be closely watched for easing signals and possible out right interest rate cuts.

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