China Signals Willingness to Eliminate Trade Imbalance with US

China Signals Willingness to Eliminate Trade Imbalance with US



Strong: Industrials, Materials, Financials, Consumer Discretionary
Weak: Utilities, Real Estate

China’s willingness to eliminate the US trade imbalance.

  • According to a report Friday, China made an offer during trade negotiations earlier this month to boost the amount of US imports, such that the trade balance with the US would be $0 by Y 2024.
  • It is not the news itself that sparked an extended rally, but the tenor of recent trade headlines that have fed hope for a meaningful trade deal.

It is evident that the market is starting to price in the positive effects of a trade deal with China should augur well for global growth and corporate earnings prospects.

China’s offer to go on a 6 year buying spree to ramp up imports from the would reconfigure the relationship between the world’s 2 largest economies.

Now expect the trade deals to be ratified with Canada and Mexico. The EU is next,

The Trump trade policy is working.

Friday, the major US stock market indexes finished at: DJIA +336.25 at 24706.35, NAS Comp +72.26 at 7156.74, S&P 500 +34.75 at 2670.67

Volume: Trade on the NYSE came in at 1.0-B/shares exchanged

  • Russell 2000 +9.9% YTD
  • NAS Comp +7.9% YTD
  • S&P 500 +6.5% YTD
  • DJIA +5.9% YTD

HeffX-LTN’s Key technical indicators for the US major stock indexes have turned Bullish to Very Bullish for the week ending 18 January 2019.

Have a terrific weekend

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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