Global equity markets are off to a strong start this week with most Asian and Pacific equity indices trading in ‘green’ on the back of Friday’s US rally and optimistic comments from the high-level US/China trade negotiations that ended in Beijing last week. China Central Television reported that the two parties had reached consensus in principle on key topics while a White House statement said the discussions “led to progress between the two parties” even if “much work remains”. This week the negotiations continue in Washington.
There are no significant economic releases today, so focus will be on political events, and most notably the signals from the US and Chinese sides in the ongoing trade talks ahead of the end-February deadline. The trade talks are set to continue in Washington this week. Also in focus will be the political fall-out from Trump’s decision to declare national emergency in order to find funding for his border wall to Mexico. Today also is the President’s Day holiday in the US today and hence US markets will be closed. Brexit negotiations between the UK and EU will continue to attract headlines as we approach end-February, where a new House of Commons vote is set to take place.
Later this week we will have more comments from central bankers on the growth and monetary policy outlook. A number of Fed officials will speak this week as well as both ECB’s Draghi and Praet. Furthermore, a broad set of Markit PMIs alongside FOMC and ECB minutes will be released.