We recently wrote about a small $100,000 trade of cheese and butter, and how this one trade changed 400 years of history in just four hours... While the trade was small, it was big for the $7 trillion trade finance industry.
On both sides of the Atlantic the revolt had been unleashed! Ordinary citizens demanding to claw back power from the Davos class were on the march! What began in 2016 would surely continue in 2017. Except it didn’t...
It is no understatement that it will take a lot of US demand to balance the market. And not just refinery demand, but also product demand too. And not just in the US. In the face of a world saturated with crude oil, the only thing that can truly balance this market is fresh demand from new technology, or a massive reduction in global refinery capacity.
Despite yesterday's whopping beats by Amazon and Google which sent the Nasdaq to new record highs after hours, this morning futures S&P futures are little changed ahead of the closely watched Q1 GDP report, European stocks and Asian equities are slightly lower, oil is higher after Russia said it had reached the 300kbpd oil cut per the OPEC pact, and the dollar was modestly in the red.
Mario Draghi's job just became a little more difficult, because one day after the head of the ECB surprised markets with a more dovish statement than expected stressing risks for European inflation, on Friday morning Eurostat reported that Euro zone inflation rose by more than expected to the European Central Bank's target and core inflation increased to its highest level in four years.
While emoting sympathy for Kim Jong Un's situation, President Trump told Reuters that he'd "love to solve things diplomatically," but warned that "there is a chance that we could end up having a major, major conflict with North Korea."
"It’s a horrible deal. It was a Hillary Clinton disaster, a deal that should’ve never been made,” Trump said. “It’s a one-way street. We’ve told them that we’ll either terminate or negotiate,” Trump said. “We may terminate. I will do that unless we make a fair deal. We’re getting destroyed in Korea."
"Back to being bearish on small caps: This last bout of optimism is likely to signal the end of the Trump Put, as friction arises over the funding the bill. We now see four key reasons to be cautious on small caps."