CDN NEWS | 
US NEWS 
Dec 10, 2018, by Lorcan Roche Kelly
(Bloomberg)
Escalating again
U.S. Ambassador to China Terry Branstad was summoned to the country’s Foreign Ministry as tensions between the nations rise following the arrest of Huawei Technologies Co. Chief Financial Officer Meng Wanzhou in Canada. While the U.S. is keen to keep the arrest separate from trade talks with Beijing, a Chinese warning of possible “further action” means investors are becoming increasingly worried that the fragile truce between the world’s two largest economies is under threat. Add data released over the weekend showing weakening demand at home and abroad for Chinese products, and it means stocks are starting the week on the back foot.
Stocks fall
Global equities are picking up where they left off on Friday with selling pressure continuing across the world. Overnight, the MSCI Asia Pacific Index dropped 1.7 percent, with Japan’s Topic index closing 1.9 percent lower. In Europe, the Stoxx 600 Index was 0.7 percent lower at 5:45 a.m. Eastern Time as investor gloom reached the worst level since 2012. S&P 500 futures pointed to further losses at the open, the 10-year Treasury yield was at 2.856 percent and gold was lower.
Vacancy
President Donald Trump announced that Chief of Staff John Kelly would depart in the coming weeks, and said that he is interviewing candidates after top vice-presidential aide Nick Ayers declared he would not be seeking the position many thought he was certain to get. Among those now tipped to be in the running are U.S. Trade Representative Robert Lighthizer; budget director Mick Mulvaney and Acting Attorney General Matthew Whitaker, according to several people familiar with the matter. U.S. allies are becoming increasingly worried about the make up of the president’s cabinet as Defense Secretary Jim Mattis is now seen as the last ‘adult in the room.’
Brexit
This week remains an exciting one for Brexit watchers. U.K. Prime Minister Theresa May is said to pull tomorrow’s planned vote on her deal to exit the European Union, after being warned she was poised for a big defeat, according to a person familiar with the matter. Meanwhile, the bloc’s highest court confirmed that the country can unilaterally halt the process. Data this morning showed the U.K. economy continued to lose steam as uncertainty over the country’s future takes a toll.
Volatility to continue
A barrel of West Texas Intermediate for January delivery was trading at $51.80, down almost 1.5 percent on the session, by 5:45 a.m., with the commodity remaining volatile amid investor caution as to whether the cuts announced at the OPEC+ meeting would be delivered. Goldman Sachs Group Inc. and Morgan Stanley are both warning that a drop in stockpiles and evidence of the cuts being implemented are needed for the market to fully price-in the announcement.
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