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ECB determined to push forward its payment system: Mersch

Mersch, Member of the Executive Board of the European Central Bank delivers a speech during Lamfalussy Lectures Conference in Budapest
Yves Mersch, Member of the Executive Board of the European Central Bank delivers a speech during Lamfalussy Lectures Conference in Budapest, Hungary, February 4, 2019. REUTERS/Bernadett Szabo

February 26, 2019

BRUSSELS (Reuters) – The European Central Bank is “determined” to push forward an instant payment system it launched last year through regulatory moves if the service failed to spread through collaboration with the industry, ECB board member Yves Mersch said on Tuesday.

“We will do it either through our collaborative, cooperative efforts together with the industry or we will do it through our regulatory capacity,” Mersch told a fintech conference in Brussels.

The ECB’s TARGET Instant Payment Settlement (TIPS) system will let people and companies in Europe transfer euros to each other within seconds and regardless of the opening hours of their local bank.

This is seen as a direct challenge to U.S. firms like PayPal, Google, Facebook and Amazon, and China’s Alibaba and Tencent which currently dominate such services in Europe.

(Reporting by Francesco Guarascio)

Source: OANN

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Guilty plea likely in sex slave case against self-help group

A co-founder of an embattled upstate New York self-help organization is expected to plead guilty in a case featuring sensational claims that some followers became branded sex slaves.

Nancy Salzman is due in federal court in Brooklyn on Wednesday afternoon for a plea hearing. There was no response to a request for comment from one of her lawyers.

Salzman was a co-founder of NXIVM, a cult-like group based near Albany. Prosecutors say a secret society within the organization branded women with a spiritual leader's initials and forced them to have sex with him.

The leader, Keith Raniere, is set to go on trial next month. Also charged in the case are Salzman's daughter as well as Seagram liquor fortune heiress Clare Bronfman and TV actress Allison Mack.

Source: Fox News National

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Dershowitz Says Trump Emergency Goes Against Constitution

Dershowitz Says Trump Emergency Goes Against Constitution

Attorney Alan Dershowitz thinks President Donald Trump's national emergency declaration was a "mistake," he admitted in a new interview.

"There will be a lawsuit. No doubt about it. It will be tied up in the courts for a long time," Dershowitz said on Sunday's "The Cats Roundtable" radio radio show, hosted by billionaire businessman John Catsimatidis.

"My own view is that it was a mistake to do it. I think emergencies are things that happened suddenly. The problems with immigration are long-term."

Trump declared the emergency on Friday in order to secure more funding to build a border barrier between the United States and Mexico. Lawmakers struck a deal to stave off a government shutdown by allocating $1.375 billion for the barrier, far less than the $5.7 billion Trump requested.

Trump's emergency order resulted in roughly $6 billion from the Pentagon's budget and $600 million from the Treasury Department being shifted over to use for the border barrier, Bloomberg reported. Dershowitz said the executive order flies in the face of the Constitution.

"The Constitution requires that all spending bills originate in the House of Representatives. This is a way of circumventing that provision of the Constitution," he said.

Source: NewsMax Politics

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Explainer: What next for Sudan after Bashir’s fall?

Sudanese demonstrators protest outside the Defence Ministry in Khartoum
Sudanese demonstrators protest outside the Defence Ministry in Khartoum, Sudan April 14, 2019. REUTERS/Umit Bektas

April 16, 2019

By Khalid Abdelaziz and Aidan Lewis

KHARTOUM/CAIRO (Reuters) – Sudan’s Omar al-Bashir has been ousted after three decades in power following months of mass protests. The military has announced a transitional period of up to two years followed by elections, but demonstrators are pushing for a quick handover of power to civilians.

HOW DID BASHIR FALL?

Bashir, 75, was one of the longest-serving leaders in Africa and the Arab world. He took power in a coup in 1989 and had survived isolation from the West, civil wars, the split between Sudan and South Sudan, indictment by the International Criminal Court, and several previous bouts of protest.

But in December, a worsening economic crisis triggered protests that quickly spread across the country of 40 million, calling for Bashir to go. The protests continued for 16 weeks despite a security crackdown in which dozens died and thousands were detained.

On April 6, protesters stepped up the pressure with a sit-in outside the military headquarters in Khartoum. Riot police and intelligence services tried to clear the area, but the army shielded them before announcing Bashir’s overthrow on April 11.

Despite Bashir’s close ties to the military’s top leadership, mid- and lower-ranking officers more connected to society sympathized with the protesters’ demands, said Hamid Eltigani, a Sudanese professor of public policy at the American University in Cairo.

As pressure from the street mounted, factions within the security establishment distanced themselves from Bashir as they sought to protect their positions, he said.

One Sudanese military officer said a deal was struck within the military leadership. “The faces had to be changed, and they all decided to change them without any bloodshed.”

WHAT HAPPENED NEXT?

The appointment of defense minister and vice-president Awad Ibn Auf as head of the Transitional Military Council fueled widespread anger among protesters because of his close association with Bashir.

He survived just 24 hours, stepping down late on Friday. Salah Abdallah Mohamed Saleh, better known as Salah Gosh, resigned as the head of the National Intelligence and Security Service (NISS) the following day.

Long considered the second most powerful man in the country after Bashir, Salah Gosh was another key target for the protesters.

WHO’S IN CONTROL NOW?

Lieutenant General Abdel Fattah al-Burhan replaced Ibn Auf as head of the military council. Burhan was the third most senior general in the Sudanese military and is little known publicly. As chief of Sudan’s ground forces he oversaw Sudanese troops fighting in the Saudi-led Yemen war and has close ties to senior Gulf military officials.

Burhan’s deputy is Mohamed Hamdan Dagalo, known by his nickname Hemedti, who heads Sudan’s Rapid Support Forces. The RSF is a paramilitary grouping that grew out of the Janjaweed militias that fought in Darfur and has provided troops to fight in Yemen.

Other members of the 10-man military council include a NISS representative and the chief of police.

A Sudanese source close to Sudan’s military leadership said the United Arab Emirates, Saudi Arabia and Egypt had a role in planning “the removal of Bashir and General Ibn Auf and Salah Gosh” as part of a strategy of “weakening the power of the Islamists in power in Sudan”.

Bashir came to power in an Islamist-backed coup. He belonged to the Islamic Movement, Sudan’s equivalent of the Muslim Brotherhood, and imposed Sharia law.

WHO SUPPORTS THE NEW LEADERSHIP?

The UAE, a leading member of the Saudi-led coalition fighting in Yemen, was quick to welcome Burhan’s appointment and said it would look to accelerate aid to Sudan. Shortly after Burhan’s nomination, Saudi Arabia said it would provide wheat, fuel and medicine to Sudan.

The UAE and Saudi, which supported the toppling of the Muslim Brotherhood’s Mohamed Mursi in Egypt and have worked to counter Islamists linked to the Brotherhood across the region, are following the same goal in Sudan, said the Sudanese source.

“They want to use economic aid to encourage some power centers in Sudan to weaken the presence of Islamists and their full control over economic institutions.”

The influence of their regional rivals Qatar and Turkey, which both had ties to Bashir, will be limited, said the Sudanese military officer. “It was a tug of war, and right now UAE and Saudi won,” he said.

Hemedti has received of Western diplomatic envoys, several of whom say they have pressed him to ensure a rapid transition to civilian rule. The British ambassador said the meeting was “not to endorse or confer legitimacy”. The Dutch envoy said the meeting was held at Hemedti’s invitation.

HOW MUCH COULD THE MILITARY CONCEDE?

Burhan has promised a civilian government after consultations with the opposition, and announced an easing of emergency measures and the release of political detainees. But there has been little word from the military on protesters’ demands for a civilian presence in the ruling council, and for members of Bashir’s entourage – some of whom face international sanctions and charges – to be held to account.

The military may be wary of ceding ground if it faces opposition from other parts of the security apparatus.

Bashir had the strongest links across different, overlapping branches of the security forces, which could start competing with each other now he’s gone. While the RSF and the NISS are linked to Saudi Arabia and the UAE, Islamists within Sudan’s Popular Defence Forces have connections to Qatar, said Alex de Waal, Executive Director of the World Peace Foundation at Tufts University.

Military officers “basically wanted a soft landing for Bashir, and the army to be kept intact as an institution, and they have Egyptian backing in that strategy,” said de Waal. “The problem is that the demands of the demonstrators are for democracy and they are the only people who want democracy. Nobody else wants democracy.”

WHAT FATE FOR BASHIR?

When Ibn Auf announced Bashir’s overthrow he said the former president had been detained. Sources told Reuters he was being held at the time under heavy guard at his residence.

The military council has said it will not extradite him, but may try him in Sudan.

The ICC issued arrest warrants for Bashir in 2009 and 2010 on suspicion of genocide, war crimes and crimes against humanity. In his final years as president he defied the court, visiting friendly nations including several ICC member states.

Sudan and Bashir denied war crimes were committed, saying casualties in Darfur were exaggerated.

Some have speculated that he could follow the example of Tunisia’s former leader Zine al-Abidine Ben Ali and seek refuge in Saudi Arabia.

(Additional reporting by Nafisa Eltahir in Dubai and Yousef Saba in Cairo; Writing by Aidan Lewis; Editing by Giles Elgood)

Source: OANN

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Powerful 7.5-magnitude quake hits eastern Ecuador

The U.S. Geological Survey says a very powerful magnitude 7.5 earthquake has struck eastern Ecuador close to its border with Peru.

The USGS said Friday morning's quake was near the town of Montalvo, Ecuador, at a depth of 132 kilometers (82 miles), nearly 17 kilometers (10 miles) south of the town of Montalvo.

There were no immediate reports of casualties.

Source: Fox News World

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Saudi women activists back in court, temporary release ruling expected

Demonstrators from Amnesty International protest outside the Saudi Arabian Embassy on International Women's day in Paris
FILE PHOTO - Demonstrators from Amnesty International stage the protest on International Women's day to urge Saudi authorities to release jailed women's rights activists Loujain al-Hathloul, Eman al-Nafjan and Aziza al-Yousef outside the Saudi Arabian Embassy in Paris, France, March 8, 2019. REUTERS/Benoit Tessier

April 3, 2019

By Stephen Kalin

RIYADH (Reuters) – Nearly a dozen prominent Saudi women activists returned to court on Wednesday to face charges related to their human rights work and contacts with foreign journalists and diplomats, in a case that has intensified Western criticism of a key Mideast ally.

Three of the women – blogger Eman al-Nafjan, academic Aziza al-Yousef and conservative preacher Ruqayya al-Mohareb – were temporarily released last week on the condition that they attend future sessions. They were seen entering the courthouse on Wednesday.

Riyadh’s criminal court had been expected to rule earlier this week on requests for temporary releases for the other women, but sources familiar with the case said the decision had been postponed until Wednesday’s hearing. The reason was unclear.

Western diplomats and media, including Reuters, have been denied entry to the hearings.

The trial, now in its third session, has drawn global attention to the kingdom’s rights record, which was already in the spotlight following the murder last year of journalist Jamal Khashoggi inside the kingdom’s consulate in Istanbul.

Three dozen countries, including all 28 EU members, Canada and Australia, have called on Riyadh to free the activists. British Foreign Secretary Jeremy Hunt and U.S. Secretary of State Mike Pompeo raised the issue during recent visits.

The temporary releases and the cases’ transfer from a high-security terrorism court at the last minute without explanation are seen as possibly signaling a more lenient handling of the case after months of lobbying by Western governments.

Yet it remains to be seen if Riyadh will bend to international pressure or pursue harsh sentences in a case critics say has revealed the limits of Crown Prince Mohammed bin Salman’s promises to modernise Saudi Arabia.

The activists were detained weeks before a ban on women driving cars in the conservative kingdom was lifted last June.

At least five men were detained in the same sweep, though none of them are currently on trial. Rights groups say two of them have been released, but the status of the others is unclear.

Some of the women on trial told the court last week they had been subjected to torture in detention, including electric shocks, flogging, and sexual assault. The Saudi public prosecutor previously denied those accusations.

Dozens of other activists, intellectuals and clerics have been arrested separately in the past two years in an apparent bid to stamp out opposition to the government.

(Reporting By Stephen Kalin; Editing by Andrew Heavens)

Source: OANN

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Bolsonaro gets Trump’s praise but few concessions, riling Brazilians

U.S. President Trump and Brazilian President Bolsonaro hold news conference at the White House in Washington
Brazilian President Jair Bolsonaro listens to U.S. President Donald Trump during a joint news conference in the Rose Garden of the White House in Washington, U.S., March 19, 2019. REUTERS/Carlos Barria

March 20, 2019

By Lisandra Paraguassu and Anthony Boadle

WASHINGTON/BRASILIA (Reuters) – Brazil’s right-wing President Jair Bolsonaro won glowing praise and conditional promises from U.S. President Donald Trump on his visit to the White House this week, yet Brazilian negotiators came away grumbling about their hosts driving a hard bargain.

Diplomats and other officials said Brazil got few immediate concessions in return for granting a unilateral visa waiver for U.S. visitors, a tariff-free quota for wheat imports and easier access for U.S. space launches from Brazil.

Bolsonaro, an outspoken Trump admirer who seemed eager to please at their first meeting, failed to win more room for Brazil’s sugar exports or overturn a U.S. ban on fresh Brazilian beef – both major objectives of the country’s farm sector.

“If this is the way forward, we might as well stay put,” said a Brazilian official directly involved in the negotiations, who requested anonymity to speak freely. “They asked for everything, but didn’t want to cede on anything.”

Reactions among Brazilians focused largely on the symbolism of the visit, with Bolsonaro supporters calling it a vindication for the iconoclastic leader and critics cringing to see him so cozy with Trump.

Yet the frustration of the Brazilian delegation reflects the deeper difficulty of overcoming trade barriers and agribusiness competition between the two countries, even as their presidents find common ground in their brash style and conservative views.

Bolsonaro celebrated his visit as the start of a new era of U.S.-Brazil friendship, playing up his admiration of Trump and their shared disdain for political correctness and “fake news,” as they often call unfavorable press coverage.

The presidents also found common ground in condemning Venezuelan President Nicolas Maduro and cooperating on public security and military development. Designating Brazil a “major non-NATO ally” will ease U.S. arms sales to the Brazilian armed forces, while a new technology safeguard agreement will help U.S. companies to conduct commercial space launches in Brazil.

However, in more transactional areas such as trade, the Brazilians’ goodwill offerings, such as an annual import quota of 750,000 tonnes of tariff-free wheat, were not met in kind.

“If this reciprocity does not occur, Bolsonaro’s preference for the U.S. will look naive in the future,” said Welber Barral, a former Brazilian foreign trade secretary.

Brazil’s new openness to wheat imports will mainly benefit U.S. exporters and was a slap in the face to neighboring Argentina, another major trade partner, Barral said.

He also warned that Brazil stands to face more setbacks on trade if it gives up the benefits of “developing country” status at the World Trade Organization (WTO) — the U.S. condition for supporting Brazil’s bid to join the Organisation for Economic Cooperation and Development (OECD), a policy forum for wealthier nations.

That conditional endorsement — concrete WTO concessions in return for symbolic OECD membership — left Brazilian Economy Minister Paulo Guedes visibly annoyed after his meeting with U.S. Trade Representative Robert Lighthizer.

“That’s no exchange. He’s making that demand,” he told journalists.

Addressing an audience at the U.S. Chamber of Commerce on Monday, Guedes also gave a hint of the sticking points that stood in the way of broader trade agreements.

“You want to sell pork? Okay, buy my beef. You want to sell ethanol? Buy my sugar. Beef for pork, ethanol for sugar, wheat for auto parts. They’re little things,” he said.

None of the exchanges he suggested were formalized in talks.

Guedes reminded the audience that China, Brazil’s top trading partner, would be ready to pick up the slack if the United States did not engage.

“They are moving in, trying to invest,” Guedes warned.

(Reporting by Lisandra Paraguassu and Anthony Boadle, Editing by Rosalba O’Brien)

Source: OANN

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FILE PHOTO: An aerial photo looking north shows shipping containers at the Port of Seattle and the Elliott Bay waterfront in Seattle
FILE PHOTO: An aerial photo looking north shows shipping containers at the Port of Seattle and the Elliott Bay waterfront in Seattle, Washington, U.S. March 21, 2019. REUTERS/Lindsey Wasson/File Photo

April 26, 2019

NEW YORK (Reuters) – U.S. economic growth is running at a 1.1% pace in the second quarter as the gains in exports and inventories recorded in the first quarter are expected to reverse, Morgan Stanley economists said on Friday.

“Our preliminary expectations for growth in the second quarter sees large drags from net exports and inventories after their contributions in 1Q,” they wrote in a research note.

Gross domestic product increased at a 3.2% annualized rate in the first three months of the year, driven by a smaller trade deficit and the largest accumulation of unsold merchandise since 2015, the Commerce Department said earlier Friday.

(Reporting by Richard Leong)

Source: OANN

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FILE PHOTO: The Deutsche Bank headquarters are pictured in Frankfurt
FILE PHOTO: The Deutsche Bank headquarters are pictured in Frankfurt, Germany, April 25, 2019. REUTERS/Ralph Orlowski/File Photo

April 26, 2019

By Tom Sims

FRANKFURT (Reuters) – Within hours of the collapse of merger talks with Commerzbank, Christian Sewing scrambled to convince investors and employees that Deutsche Bank can stand on its own two feet.

The Deutsche Bank chief executive told staff, many of whom opposed a merger because of significant job losses, that while he had not been “skeptical” about the Commerzbank talks, he was cautious about the chances of success from the start.

And another top Deutsche Bank executive said on Friday that it had been Commerzbank that initiated the talks, suggesting there was no desperation on their part for a deal.

Commerzbank denied that version of events, ending the apparent truce between the normally highly competitive cross-town Frankfurt rivals over the past six weeks.

German hopes of creating a national banking champion able to challenge global competitors were finally dashed on Thursday when Deutsche Bank and Commerzbank ended their talks due to the risks of doing a deal, restructuring costs and capital demands.

For Sewing, the failure to clinch a deal has left the 49-year-old chief executive of Germany’s largest bank, who took over just over a year ago, with his back to the wall.

Credit ratings agency Standard & Poor’s, which downgraded Deutsche Bank last year, said on Friday that Deutsche Bank “will remain under strain”, adding that it “seems to have acknowledged the need to adjust its strategy”.

Under Sewing, a new leadership has tried to revive Deutsche Bank’s fortunes, but it has faced money laundering allegations and failed stress tests, as well as ratings downgrades.

At the heart of the debate over its future is whether it should focus its business on Germany and draw a line under its costly global ambitions to take on Wall Street’s big guns.

“MARKET PLAY”

Without a deal, Deutsche Bank now finds itself back at the mercy of equity and debt markets, with UBS analysts warning that in a “stress scenario” it could again “be forced into a ‘debt-driven capital increase’ even with solid capital ratios”.

“Deutsche remains a levered market play vulnerable to external events,” the UBS analysts said in a note.

Sewing, along with many analysts, believes Deutsche Bank can go it alone in the short-term, but will be counting on a turnaround in market conditions to do so in the long-run given its dependence on volatile investment bank earnings.

“To reach our return objective, we also need to see a revenue recovery in our more market-sensitive business,” Sewing said on Friday after reporting results.

“These revenues are available to us in better market conditions given our leading positions in many of these businesses, but we need to capture them,” he added.

Revenue at Deutsche Bank’s bond trading division fell 19 percent in the first quarter, it said on Friday, underscoring weakness at its investment bank.

If those earnings do not improve, Berlin’s desire to keep its biggest bank out of foreign hands may start to wane.

“Germany’s globally active companies need competitive financial institutions that can support them around the world,” German finance minister Olaf Scholz said on Thursday.

(Writing by Alexander Smith; Editing by Keith Weir)

Source: OANN

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Panama's former president Ricardo Martinelli yells to the media while arriving to the Electoral Court in Panama City
Panama’s former president Ricardo Martinelli reacts to the media while arriving to the Electoral Court in Panama City, Panama April 26, 2019. REUTERS/Erick Marciscano

April 26, 2019

PANAMA CITY (Reuters) – Panama’s electoral tribunal has ruled that former President Ricardo Martinelli, who is awaiting trial on wiretapping charges, cannot take part in elections on May 5 in which he was running for mayor of Panama City and a seat in Congress, a spokesman for Martinelli said on Friday.

“The ruling of the electoral tribunal has disqualified him as candidate,” said the spokesman, Eduardo Camacho, calling the court’s ruling a “political decision.”

Officials at the tribunal did not immediately confirm the ruling, which also was reported in local media in Panama.

Martinelli, a supermarket tycoon who ran the Central American country from 2009 to 2014, was extradited to Panama last June from the United States and charged with spying on 150 people, including politicians, union leaders and journalists.

A judge had previously cleared Martinelli to run for mayor of the capital. His critics vowed to appeal that decision.

(Reporting by Elida Moreno and Stefanie Eschenbacher; Editing by Bill Trott)

Source: OANN

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FILE PHOTO: Amazon boxes are seen stacked for delivery in the Manhattan borough of New York City
FILE PHOTO: Amazon boxes are seen stacked for delivery in the Manhattan borough of New York City, January 29, 2016. REUTERS/Mike Segar/File Photo

April 26, 2019

(Reuters) – Shares of Walmart, Target and other U.S. retailers fell on Friday as Amazon.com Inc unveiled a one-day delivery plan for its Prime members in a move to further disrupt the fiercely competitive retail landscape.

The e-commerce giant’s announcement on Thursday could cause other brands, manufacturers, retailers, and logistics companies to have to invest more aggressively to compete with Amazon and its delivery, analysts said.

Retailers in recent years have poured billions into ecommerce and faster shipping options and are trying to close the gap with Amazon.

“This is about making it more expensive to catch up and affirms our world view that only the largest and smartest will survive,” Bernstein analyst Brandon Fletcher said.

The move is expected to heighten consumer expectations on e-commerce delivery just like Amazon did with its two-day shipping option for members of its loyalty club Prime, noted analysts.

“The faster you ship, the more people buy,” RBC Capital Markets analyst Mark Mahaney said.

The challenge for non-Amazon players was that very few of the existing logistics and parcel delivery players now have the ability to do nationwide one-day delivery, Morgan Stanley analyst Brian Nowak said.

“And even fewer can do it at the vast scale and reasonable cost that AMZN would need for Prime delivery,” Nowak said in a note.

Walmart Inc’s shares fell about 3 percent, while Target Corp dropped about 5 percent in morning trade.

Shares of Kohl’s Corp, Macy’s Inc and Nordstrom Inc fell about 1 percent. Grocer Kroger Co was nearly 3 percent lower, while consumer electronics retailer Best Buy Inc dropped 2.1 percent.

(Reporting by Soundarya J and Akanksha Rana in Bengaluru; Editing by Maju Samuel)

Source: OANN

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A Chinese woman adjusts a Chinese national flag next to U.S. national flags before a Strategic Dialogue expanded meeting, part of the U.S.-China Strategic and Economic Dialogue (S&ED) in Beijing
A Chinese woman adjusts a Chinese national flag next to U.S. national flags before a Strategic Dialogue expanded meeting, part of the U.S.-China Strategic and Economic Dialogue (S&ED) held at the Diaoyutai State Guesthouse in Beijing, July 10, 2014. REUTERS/Ng Han Guan/Pool (CHINA – Tags: POLITICS BUSINESS)

April 26, 2019

By April Joyner

NEW YORK (Reuters) – Even as the lift from optimism over prospects for U.S.-China trade detente shows signs of wearing off for the wider U.S. stock market, upbeat sentiment around China’s economy could bolster shares of materials companies.

Shares of S&P 500 industrial and technology companies, which were buffeted by last year’s tit-for-tat tariffs as well as slowing global demand, have been very responsive to progress in U.S.-China trade relations and a strengthening Chinese economy. This year, those sectors have outpaced the ascent in the S&P 500, which reached a record closing high on Tuesday.

Materials stocks have not been as sensitive, however, even though they also stand to benefit as a stronger Chinese economy lifts global consumption and industrial output. As China has taken measures to stimulate its economy, its economic data have turned more upbeat. That in turn could aid global growth, which has flagged as a result of China’s cooldown.

“What we’re seeing is China spending more on stimulus: fiscal stimulus and monetary stimulus,” said Kristina Hooper, chief global market strategist at Invesco in New York. “That’s likely to be a positive for materials.”

The People’s Bank of China has cut banks’ reserve requirement ratio five times over the past year and is widely expected to ease policy further to spur lending and reduce borrowing costs. The stimulus appears to have boosted Chinese economic data, with factory activity growing in March for the first time in four months.

Yet so far in 2019, the S&P 500 materials index has underperformed the S&P 500 at large, rising just 11.9% compared with 16.7% for the benchmark index. Moreover, it is among the biggest decliners in the period since the S&P’s previous record closing level on Sept. 20. The materials index has fallen 7% over those seven months, versus a 5.2% gain for technology and a 3% loss for industrials. Only the energy index has dropped more over that period.

A trade agreement could serve as a catalyst for a bump in materials shares as a drag on China’s economy is lifted, some market strategists say. Some commodity prices, including those for copper and oil, have ascended this year as the prospects for the global economy have somewhat brightened.

“It all goes back to the global growth outlook,” said Andrea DiCenso, portfolio manager for alpha strategies at Loomis Sayles in Boston. “With the front run in hard data, we’re beginning to see a pretty significant rally.”

Additionally, a trade agreement is expected to include commitments from China to purchase higher quantities of U.S. products such as soybeans, which could benefit companies that make agricultural chemicals, including DowDuPont Inc and CF Industries Holdings Inc.

CF Industries is scheduled to report quarterly results after the bell on Wednesday, and DowDuPont is scheduled to report before the market open on Thursday.

To be sure, even with a trade agreement, some materials companies could face price pressures. Shares of Freeport-McMoRan Inc fell 10.1% on Thursday after the copper mining company posted a lower-than-expected profit as its production slipped and its costs rose.

A rollback of tariffs on Chinese imports, particularly aluminum and steel, would likely prompt a fall in some commodity prices, which could hurt prospects for certain materials companies, said Gene Goldman, chief investment officer at Cetera Investment Management in El Segundo, California.

Even so, those drawbacks may be outweighed by the support for global demand fostered by a U.S.-China trade agreement.

“You could see a number of companies with lowered expectations bring them back up as they talk favorably about the impact that a trade deal would have on them,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.

(Reporting by April Joyner; additional reporting by Sinéad Carew; editing by Jonathan Oatis)

Source: OANN

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