FYI: Global stocks slumped Wednesday as trade talks between the U.S. and China appeared to near an impasse, with President Trump threatening to raise tariffs further.
The Dow Jones Industrial Average dropped 112 points , or 0.40%. The S&P 500 shed 0.38%. The Nasdaq Composite lost about .51%, retreating from the record hit Tuesday.
Losses deepened and major U.S. indexes fell near session lows after Reuters reported that the first phase of a trade deal between the U.S. and China may not materialize by year-end. Trade has been a key driver of market swings this year and the recent dash for stock records had been driven, in part, by optimism on a final deal.
Stocks in Europe and Asia also logged declines as investors grew concerned that relations between the world’s two biggest economies may be further strained after the U.S. Senate passed a bill in support of Hong Kong’s antigovernment protesters.
The bill would require the U.S. Secretary of State to certify annually that Hong Kong remained sufficiently independent from Beijing to warrant the special status that has helped the city grow into a global financial hub. China’s Foreign Ministry said the act was a violation of international law, while Hong Kong officials said foreign legislatures shouldn’t interfere with its internal affairs.
The Chinese aren’t very happy about that bill progressing,” said Paul Flood, multiasset portfolio manager at Newton Investment Management. “It does make the tariffs discussion more difficult.”
A breakdown in the trade talks would derail the White House’s plans for a limited “phase one” agreement this year. Investors are also growing jittery that fresh tariffs on Chinese products including smartphones and toys may be put into effect Dec. 15, directly hitting American consumers. Mr. Trump said in a Tuesday cabinet meeting that China needs to make a deal he likes to avoid levies going even higher.
The strength of the U.S. consumer was on display Wednesday as corporate earnings drove swings among shares of individual companies. Shares of Target climbed about 12%—on track for a fresh record—after the retail chain posted another quarter of rising sales as the company continued to draw more shoppers online and in its stores.
Meanwhile, the pan-continental Stoxx Europe 600 index fell 0.4%, led by declines in almost every sector.
Investors reached for haven assets, sending the yield on 10-year Treasurys to 1.736% Wednesday, according to Tradeweb, from 1.785% Tuesday. Bond yields across Europe also fell, with the German 10-year bund recently yielding minus 0.368%, from minus 0.337% Tuesday.
Later Wednesday, the Federal Reserve will issue its October policy meeting’s minutes, which may offer further clues about the direction of future policy.
Regards,
Ted
Bloomberg Evening Briefing:
https://www.bloomberg.com/news/articles/2019-11-20/your-evening-briefingMarketWatch:
https://www.marketwatch.com/story/dow-futures-slip-as-trump-threatens-to-raise-tariffs-if-china-trade-talks-languish-2019-11-20/printWSJ:
https://www.wsj.com/articles/global-stocks-fall-as-trade-talks-flounder-11574244277Bloomberg:
https://www.bloomberg.com/news/articles/2019-11-19/asia-stocks-set-to-slip-treasury-yields-retreat-markets-wrap?srnd=premiumIBD:
https://www.investors.com/market-trend/the-big-picture/stock-market-falls-china-fears-pinduoduo-stock-pagseguro-stock/CNBC:
https://www.cnbc.com/2019/11/20/dow-futures-us-china-trade-and-federal-reserve-minutes.htmlReuters:
https://uk.reuters.com/article/us-usa-stocks/wall-street-drops-on-trade-deal-delay-concerns-idUKKBN1XU1MAU.K:
https://uk.reuters.com/article/uk-britain-stocks/trade-view-dims-kingfisher-drops-on-ftses-worst-day-in-three-weeks-idUKKBN1XU0XTEurope:
https://www.reuters.com/article/us-europe-stocks/trade-worries-push-european-shares-to-worst-day-in-three-weeks-idUSKBN1XU16AAsia:
https://www.cnbc.com/2019/11/20/asia-markets-november-20-us-china-trade-war-china-lpr-currencies.htmlBonds:
https://www.cnbc.com/2019/11/20/us-bonds-treasury-yields-in-focus-amid-us-china-trade-tensions.htmlCurrencies:
https://www.cnbc.com/2019/11/15/forex-markets-us-china-trade-deal-in-focus.htmlOil
https://www.cnbc.com/2019/11/20/oil-jumps-to-high-on-day-after-inventory-data-rising-tensions-in-saudi-arabia.htmlGold:
https://www.cnbc.com/2019/11/20/gold-markets-china-us-trade-hong-kong-in-focus.htmlWSJ: Markets At A Glance:
https://markets.wsj.com/usMajor ETFs % Change:
https://www.barchart.com/etfs-funds/etf-monitorSPDR's Sector Tracker:
http://www.sectorspdr.com/sectorspdr/tools/sector-trackerSPDR's Bloomberg Sector Performance Pie Chart:
https://www.bloomberg.com/markets/sectorsCurrent Futures:
https://finviz.com/futures.ashx 
