- U.S. equities finished positive for the week: On the week, the Dow Jones Industrial Average (Dow) gained 42 points, or rose 0.17%, to 25,106. The Standard & Poor’s (S&P500) index increased 1 point, or rose 0.05% to 2,708. The Nasdaq closed 0.47% higher at 7,298 while the 10-year Treasury ended the week at 2.63%.
- U.S./China Trade: As March 1 approaches, marking the official end of the 90-day U.S./China trade cease-fire, it is worth noting that there has not been any meaningful progress reported. A number of media reports and political commentators have suggested the date will be pushed back as there is very little chance a deal will be reached before the deadline. At this point, we also know President Trump has said a meeting with President Xi before the March 1 deadline was “highly unlikely,” although plans are still in place to meet once a compromise is reached. On the bright side, this week, a U.S. delegation, including U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin will travel to China to resume trade negotiations – investors will be watching the news flow closely.
- Global Growth: The story has not changed much, with the general narrative being, the United States remains strong, while Europe and China see largely softening economic data points. However, although China appears to be stabilizing at the margin, Europe is not improving much. Last week, we saw the European Commission cut its outlook for economic growth in Europe as data coming out of Germany and other core markets continue to show sluggishness. Germany is now expected to grow 1.1% this year, down from 1.8%, while the EU region is set to grow 1.3%, down from the previous 1.9% forecast. Italian growth forecasts also continue to be revised lower reviving fiscal concerns from a few weeks ago.
- U.S. Government Shutdown: Congress has until Friday to avert another partial Government shutdown, as the nation’s lawmakers search for common ground on border security. Following the record 35-day shutdown, it appears there is no appetite to allow another shutdown from both sides of the aisle.
- Fourth quarter earnings season will continue this week with expected earnings releases from Restaurant Brands International, Activision Blizzard, Cisco Systems, Inc., Waste Management, Coca-Cola Company, PepsiCo, Inc., and Moody’s, among others.
- On the economic calendar, we will see Fed Speakers early in the week, followed by the Job Openings and Labor Turnover (JOLTS) report, Consumer Price Index (CPI), and Producer Price Index (PPI) data. In the back half of the week, we will see Retail sales data, Industrial Production, and University of Michigan Consumer Confidence, as well as trade balance numbers. Outside the United States, we will see Euro-zone meetings earlier in the week with industrial production, Gross Domestic Product (GDP) and trade numbers later in the week. In China, we will start the week with FX reserves and end the week with trade balance data and CPI/PPI data.