There is an emerging sense of optimism being sparked by a trifecta of geopolitical happenings which have unfolded within the past 48 hours.
China wants to come to the table, a deal on the North American Free Trade Agreement (NAFTA) is making good progress and Qatar is providing a $15 billion lifeline to Turkey to steady the lira and soaring interest rates. While I support the first two items of progress, keeping pressure on Turkey for the release of American pastor Andrew Brunson — after that country tried to negotiate clearance for a Turkish bank that has been under legal investigation by the United States for violating sanctions against Iran as conditions for his release — is the right posture.
National Security Advisor John Bolton told the Turkish ambassador “no deal,” leaving the situation in a current stalemate. Here is my market analysis.
With five of the past six trading sessions being lower for the major averages, the headline that ???China and U.S. to Resume Low-Level Talks in Bid to Resolve Trade War??? came as a breath of fresh air. The market had been suffocating on the notion of further tariffs being triggered and potential additional action if China didn???t start to cooperate. China’s Ministry of Commerce announced that vice commerce minister Wang Shouwen will visit the United States in late August to discuss trade with U.S. Treasury Under Secretary David Malpass.
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