Global News June 19, 2018

  1. BBC
  2. Global News June 19, 2018

“Stocks Slide, Bonds Rally as Trade Fears Build: Market Wrap.”

Investors dumped riskier assets as a trade dispute between the world’s two largest economies showed signs of deepening and accelerating. Stocks dropped, Treasuries rallied and the dollar climbed with the yen.
The S&P 500 fell for a third day after losses across Europe and Asia, where Chinese shares plunged after reopening following a holiday. President Donald Trump threatened tariffs on another $200 billion of Chinese goods, and the Asian nation pledged retaliation. The euro dropped after the latest dovish message from the European Central Bank, and the British pound weakened as the country prepared for another knife-edge Brexit vote on Wednesday.
The Cboe Volatility Index rose the most in three weeks, while government bonds in Europe rallied alongside U.S. notes. Developing-nation stocks dropped the most since March.
Tough trade talk is nothing new for investors in 2018, but the perception that stress is ratcheting up between the U.S. and China is taking a toll on markets. The protectionist moves come at a time when many are already voicing concern that global growth could lose momentum as the U.S. tightens monetary policy and Europe pulls back on stimulus.
“The degree of both rhetoric and substance behind the proposals that have gone back and forth recently is worrisome,” Mark Howard, a senior multi-asset specialist at BNP Paribas, said in an interview on Bloomberg TV. “This has caused a bit of a risk-off trade today, and it’s a cause of caution by major investors.”


“Trump, U.S. Republicans to meet amid furor over immigrant children.”

President Donald Trump, facing a blast of criticism for the detention of children separated from their immigrant parents at the U.S.-Mexico border, was slated to meet with Republican lawmakers on Tuesday ahead of votes on immigration legislation.
The family separations, documented by online videos of youngsters detained in cages, put Trump back at the center of a furor over immigration, an issue he inflamed as a presidential candidate and that he has carried into his administration.
He will travel to Capitol Hill as Democrats hurl charges of “barbaric” treatment of children and his fellow Republicans move tentatively toward legislation that would curb, if not entirely halt, the practice of separating families.
In April, U.S. Attorney General Jeff Sessions announced a “zero tolerance” policy in which all those apprehended entering the United States illegally would be criminally charged, which has led to children being separated from their parents.
Parents who are referred by border agents for prosecution are held in federal jails, while their children are moved into detention facilities under the custody of the Office of Refugee Resettlement (ORR), a division of the Department of Health and Human Services. But Democrats and some Republicans have criticized the administration for dividing nearly 2,000 children from their parents between mid-April and the end of May.
One bill would limit, but not fully prohibit family separations, fund Trump’s wall and give legal protections to young immigrants, known as “Dreamers,” who were brought to the country illegally as children. Details were still in flux. The bill faces strong headwinds as it is opposed by Democrats, who object to another provision that would cut legal immigration levels, and conservative Republicans who are backing a rival bill that takes a harder line on immigration.


BBC News
“Italian populist Salvini sparks row over counting Roma.”

Italy’s right-wing populist Interior Minister, Matteo Salvini, has prompted a new outcry by saying he wants a census of the Roma community that would lead to non-Italians being deported. After a chorus of criticism he said his only aim was to protect Roma children.
There are at least 130,000 Roma (Gypsies) in Italy, and many live in unlicensed camps on city outskirts. Last week Mr Salvini refused to allow a charity ship carrying 629 migrants into Italy.
He has tried to limit the number of migrants entering Italy by blocking charity ships that rescue people off the Libyan coast. The Aquarius eventually arrived in the Spanish port of Valencia at the weekend. Since Mr Salvini’s League party came to power this month with the anti-establishment Five Star movement, he has focused heavily on immigration.
His remarks on Roma were eventually rebutted by his fellow deputy prime minister and leader of Five Star, Luigi di Maio, who made clear that a census was unconstitutional. On the open road, untested, the level of emissions would in practice be far higher – up to 40 times as bad as recorded under laboratory conditions.


“Russia Repeats Oil-Hike Proposal as Iran Digs In: OPEC Update.”

Oil ministers from OPEC and its allies are starting to arrive in Vienna for what promises to be one of the cartel’s most contentious meetings in years.
Russia’s energy minister reiterated that OPEC should consider a 1.5 million-barrel-a-day increase to output quotas because the market is almost balanced.
High seasonal demand could translate into a supply deficit next quarter if OPEC and its allies don’t move to raise production, Alexander Novak said in Moscow. The minister said he had “no official information” that some countries would block a decision to boost output.
To hear more about OPEC, click here for the Bloomberg Commodities podcast.
Russia’s push for a big ramp-up contrasts with the more modest increase being debated by OPEC ahead of this week’s summit. Members are discussing a proposal to deliver 300,000 to 600,000 barrels a day of additional oil to global markets over the next few months, according to people briefed on the talks.
Russia’s proposed 1.5 million-barrel increase would be allocated proportionally among all members of the group. That means only about two-thirds of the volume would likely flow to the market because countries including Venezuela and Mexico are unable to raise output.
OPEC’s No. 3 producer, Iran, urged fellow members to “do nothing about production,” warning that a relaxation of output curbs would swell stockpiles again.
“Increasing production at this time would be an attempt to build stocks,” said Iran’s OPEC governor, Hossein Kazempour Ardebili. “This cyclic play is not accepted!”
Meanwhile, war-torn Libya reported a 400,000-barrel-a-day drop in output after an armed assault on its third-largest port, adding to global supply concerns currently centered on Venezuela and Iran.
Workers at the Ras Lanuf terminal are trying to put out a fire and “stabilize the situation” before the national oil company can “think what to do” about production, Chairman Mustafa Sanalla said in Vienna.