If there will be no shocking information from Donald Trump, markets will grow this week. Stocks rise, bonds fall, defensive currencies and gold decline. Markets believed in the stimulus measures of central banks. Stocks rose after the Trump administration announced progress in trade negotiations, rumors are also growing that major central banks will offer stimulus packages to strengthen their economies. Treasury bonds are declining.
The S&P 500 is extending growth for the third day, as U.S. Secretary of Commerce Wilbur Ross said the country has delayed the imposition of restrictions that the Trump’s administration imposed on some business operations of Chinese Huawei Technologies Co. Long-term bonds pushed the Treasury yield curve from inversion, as the US government is considering issuing centenary securities. The Bundes fell because Germany, as already said, is preparing for fiscal stimulus.
Oil rises after a drone attacks a Saudi oil field. Gold has fallen. The week began on a more positive note, as Huawei news was seen as encouraging for the long-awaited trade pact between the two largest economies in the world. The official announcement followed President Donald Trump's tweet on the weekend, which indicated that the US "got along very well with China and talked," but suggested that it wasn’t ready to make a deal yet.
The Japanese currency fell for the third consecutive session against the dollar, while the Swiss currency fell to a two-week low against the dollar. Optimism about the government’s efforts to prevent a recession in the United States, whose fear escalated with the inversion of US bond yield curves last week, widened ahead of a symposium in Jackson Hole, Wyoming, near the end of the week, where central bankers could announce key measures to stimulate.
China has also unveiled interest rate reform, which is expected to lower the cost of corporate loans. It also helped lift the mood of the market, while the prospect that the coalition government in Germany would abandon its balanced budget by issuing new debt as part of its economic stimulus measures also contributed to an increase in risk appetite.