China cuts growth goal, some green shoots in Europe’s economy, and Trump finds another trade target. Here are some of the things people in markets are talking about today.
China lowered its goal for economic growth this year to between 6 and 6.5 percent, the weakest in almost three decades. When announcing the target at the first day of the National People’s Congress in Beijing, Premier Li Keqiang warned of a “tough economic battle ahead” as he unveiled 2 trillion yuan ($298 billion) of tax cuts while the defense budget will grow by 7.5 percent. Shares in Shanghai closed at their highest level since June.
A little better
PMI data for the euro area showed expansion in February was stronger than originally estimated, with a composite index climbing to 51.9 for the month, boosted by services. Retail sales numbers for the single-currency zone showed a rebound in January, climbing 1.3 percent from the previous month. Services PMI for the U.K. indicated that economy remains close to stagnation.
More trade measures
President Donald Trump announced plans to end trade preferences for India and Turkey, beginning a 60-day countdown to the potential termination of designations that allow duty-free entry of wide-ranging products from those countries. The move comes just weeks before India’s national elections and may increase opposition attacks on Prime Minister Narendra Modi’s foreign policy track record. Two separate reports published over the weekend found that the cost of Trump’s trade policies ran into the billions of dollars and are being largely borne by American consumers.
Overnight, the MSCI Asia Pacific Index slipped 0.3 percent while Japan’s Topix index closed 0.5 percent lower with technology shares among the worst performers. In Europe, the Stoxx 600 Index was 0.1 percent lower at 5:50 a.m. Eastern Time as investors awaited more details on any potential U.S.-China trade deal, and Thursday’s ECB decision. S&P 500 futures pointed to a small gain at the open, the 10-year Treasury yield was at 2.737 percent and gold was lower.
At 10:00 a.m., shutdown-delayed data on December home sales is expected to show an 8.7 percent contraction from the previous month. At the same time, the February ISM non-manufacturing index is published. The monthly budget statement for January is released at 2:00 p.m. And it’s a big day for retail sector earnings, with Target Corp., Kohl’s Corp. and Ross Stores Inc. among the companies reporting.