Morning Brief: US-China trade war begins

Friday, July 6, 2018

What to watch today

At 8:30 a.m. ET on Friday morning, the Bureau of Labor Statistics will release its employment report for the month of June. Economists expect this report will show another strong month of labor market growth in the U.S., with nonfarm payrolls forecast to have increased by 195,000 with the unemployment rate holding steady at an 18-year low of 3.8%, according to estimates from Bloomberg. Wages will of course be closely watched by economists looking for signs of inflationary pressures in the economy, and expectations are for average hourly earnings to pick up by 0.3% over the prior month and 2.8% over last year.

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Top news

REUTERS/Joshua Roberts

As tariffs strike, China blames U.S. for ‘largest-scale trade war’The United States and China slapped tit-for-tat duties on $34 billion worth of the other’s imports on Friday, with Beijing accusing Washington of triggering the “largest-scale trade war” ever in a sharp escalation of their months-long conflict. [Reuters]

Deutsche Bank shares spike on report of interest from JPM and ICBCShares in Germany’s troubled Deutsche Bank (DB) jumped by up to 6% on Friday following a magazine report that JPMorgan (JPM) and Industrial and Commercial Bank of China may be interested in taking a stake. [Reuters]

Doubts grow Aramco IPO will ever happen: Preparations for the public listing of Saudi Arabia’s state oil company, a centerpiece of the government’s plan to open its economy, have stalled, leaving government officials and people close to the process doubting that it will go forward at all. The initial public offering of Saudi Arabian Oil Co., better known as Aramco, was meant to be the cornerstone of the kingdom’s plan to be less reliant on oil. [The Wall Street Journal]

Tax wrinkle spurs pension funds to buy more Treasurys: U.S. companies are funneling extra money into their pension funds to take advantage of temporary tax savings, moves that are helping suppress yields on long-term Treasurys. S&P 500 companies are contributing to pension plans this year at a pace expected to nearly match 2017’s level, which at $63 billion was the most since 2003, according to Goldman Sachs Asset Management. [The Wall Street Journal]

EPA’s new chief is former coal lobbyistThe new leader of the Environmental Protection Agency is a former coal industry lobbyist who helped lead an industry fight against regulations that protect Americans’ health and address climate change. Andrew Wheeler, the No. 2 official at EPA, will take over the agency Monday now that President Donald Trump has accepted the resignation of embattled administrator Scott Pruitt. [AP]

For more of the latest news, go to Yahoo Finance

U.S. Secretary of State Mike Pompeo, second from left, is greeted by North Korean Director of the United Front Department Kim Yong Chol as he arrives at Sunan International Airport in Pyongyang, North Korea, Friday, July 6, 2018.  Pompeo in North Korea vows to get details of nuke commitment. (AP Photo/Andrew Harnik, Pool)

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