Wall Street Investors Wait And Watch As US, China Hold Trade Talks In UK
Wall Street stocks were little changed early Monday as investors awaited details from trade talks between the United States and China in London.
The Dow Jones Industrial Average edged down 0.1 percent to 42,710.60, while the broad-based S&P 500 Index was flat at 5,999.11.
The tech-heavy Nasdaq Composite Index crept up 0.1 percent to 19,550.16.
There is "some optimism that momentum could be maintained" in the markets, with the S&P 500 not far from a new all-time high, said Sam Stovall of CFRA Research.
"But we'll have to wait and see whether the economic data, the trade negotiations will continue to be supportive," he added.
On Monday, representatives from the world's two biggest economies gathered in London for trade talks.
A US delegation led by Treasury chief Scott Bessent, Commerce Secretary Howard Lutnick and US Trade Representative Jamieson Greer began a round of negotiations with a team headed by Chinese Vice Premier He Lifeng.
All eyes are on whether both sides can reach a longer-lasting truce, after temporarily de-escalating staggeringly high tariffs in May.
But tensions over export controls underscore the challenges that both countries are grappling with.
Markets will also be monitoring US inflation figures due midweek.
Among individual companies, shares of Warner Bros. Discovery surged more than 12 percent in early trading after it announced Monday that it will split into two companies as it seeks to build up its streaming business.
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India.com
an hour ago
- India.com
Meet QRSAM – India's Strongest Rs 30,000 Cr Missile Wall That Will Crush Pakistan's Drones, Block China's Jets
New Delhi: India is set to bring home a deadly new shield, the Quick Reaction Surface-to-Air Missile (QRSAM) system, in a deal worth Rs 30,000 crore. It is fast and smart. And it kills moving threats in seconds. It is a mobile missile defence system designed to track and destroy enemy aircraft and drones in real-time. It reacts quickly, locks onto fast-moving targets and takes them out in a flash. This new system will be deployed near the Pakistan and China borders. Three full regiments will protect the skies. Sources say the Ministry of Defence is ready to seal the deal with the DRDO. The QRSAM is a beast in battle. It can track enemy aircraft from 120 km away. It can lock onto threats from 80 km. And it does not wait. It finds. It fires. It finishes. It works in the day. It works at night. It can move from place to place. And most importantly, it takes down moving targets at short notice. The QRSAM will strengthen India's short-to-medium range air defence, support systems like MRSAM and Akash and fill the gaps by intercepting threats that sneak in under radar coverage. With a range of 30 km, it will team up with India's other missiles such as MRSAM and Akash to trap anything that tries to enter Indian airspace. A top-level meeting is expected later this month. Sources say QRSAM could soon be inducted into the armed forces. After May's Conflict, India Moves Fast From May 7 to 10, India and Pakistan clashed in a shadow war. Pakistan fired Chinese missiles. It sent Israeli drones. But none could breach India's air shield. Akashteer, S-400 and Iron Drone systems struck them down mid-air. Not a single missile made it to its target. Akashteer became the unexpected hero. It is powered by artificial intelligence. It controls all ground air-defence systems through one brain. It connects radars, sensors and comms in real time. That edge saved lives. Difference between QRSAM and S-400 S-400 is a long-range defence system with a reach of up to 400 km. The QRSAM is for short-range and fast-reaction strikes within 30 km. While S-400 locks onto threats from far away, the QRSAM is designed to handle close-in, sudden threats like low-flying jets and drones. S-400 is the king of India's air defence. It blocks enemy missiles, rockets, drones and fighter jets. Russia made it. India bought five units in 2018 for Rs 40,000 crore. Each unit is mobile. It can move fast. Its radar sees targets from 600 km away. Within minutes, it is ready to fire. It can track 160 targets at once and launch two missiles per threat. The version India has hits from 400 km away. It can also strike threats 30 km above the ground. That makes it one of the world's most advanced defence systems. With QRSAM joining forces with Akash, S-400 and Iron Dome-style defences, India is building an air wall no missile can cross.
Mint
an hour ago
- Mint
London calling, stocks crawling higher
ORLANDO, Florida, June 9 (Reuters) - TRADING DAY Making sense of the forces driving global markets By Jamie McGeever, Markets Columnist I'm excited to announce that I'm now part of Reuters Open Interest (ROI), an essential new source for data-driven, expert commentary on market and economic trends. You can find ROI on the Reuters website, and you can follow us on LinkedIn and X. Trade tensions, policy uncertainty and shaky economic data continue to cloud the near-term outlook for world growth, but they remain on the back burner for now as investors kick off the week by pushing global stock markets higher. In my column today I look at why the dollar has depreciated significantly this year regardless of how U.S. stocks and bonds have performed. The main reason? Hedging. More on that below, but first, a roundup of the main market moves. If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today. 1. Defying debt warnings, Republicans push forward on Trump tax agenda 2. 'Blue' euro bonds to rival Treasuries?: Mike Dolan 3. Japan to consider buying back some super-long government bonds, sources say 4. Wall Street, Main Street push for foreign tax rethink in U.S. budget bill 5. Auto companies 'in full panic' over rare-earths bottleneck * World stocks set a new record high. The MSCI World index rises 0.3% to 895.60 points. * Wall Street closes in the green despite a flurry of late selling, and the S&P 500 nudges further above 6000 points. The Russell 2000 small caps index rises most, up 0.6%. * The dollar index slips 0.25%. But the biggest decliner in global FX on Monday is the Colombian peso, down 0.7% after the assassination attempt on Senator Miguel Uribe, a potential presidential contender. * The U.S. yield curve bull steepens, snapping four sessions of flattening, with the 2- and 3-year yields down 4 bps. Next up, a $58 billion auction of 3-year notes on Tuesday. * Oil rises for a third day, with Brent crude climbing 1% above $67/bbl, its highest level since late April. London calling, stocks crawling higher It was a fairly quiet start to the week across global markets on Monday, with strong equity gains in Asia followed by a grind higher on Wall Street which lifted the MSCI World index to a fresh record high. The main areas of focus for investors were China's economic 'data dump' for May, then the high-level U.S.-China trade talks in London. The two are connected - the U.S. is a less important market for China than it used to be, underscored in May's trade figures from Beijing and reflected in the lack of concrete progress from the negotiations in London. China's total exports rose 4.8% in May from a year earlier but this masks a huge split between the U.S. and the rest of the world. Exports to the U.S. plunged 34.4% year-on-year in value terms, the sharpest drop since February 2020 just before the pandemic, while exports to the rest of the world rose 11.4%. Monthly data are volatile, of course, and May's figures were also distorted by tariffs. Still, U.S.-bound shipments worth $28.8 billion last month were just 9% of the total $316 billion. Economist Phil Suttle notes that is less than half the average share in the decade leading up to President Donald Trump's first trade war. The London talks are expected to continue on Tuesday. But as was the case following Trump's telephone call with Chinese leader Xi Jinping on Thursday, there is little indication of a significant breakthrough, far less China bending to U.S. demands. "U.S. Treasury Secretaries who live in unbalanced economies might not want to throw barbs such as the 'most unbalanced in modern history' at China without first looking at some data," Suttle wrote on Monday. "The choice to fight an opponent should be conditioned on a clear-headed view of its strengths and weaknesses. The U.S. has done a marvelous job of (once again) deluding itself on this front," Suttle added. Still, divisions between the two countries and the threat to global supply chains are proving no barrier to rising stock markets. Japan's Nikkei and the MSCI emerging and Asia ex-Japan indexes rose around 1%, Hong Kong-listed tech stocks rose nearly 3%, and Wall Street closed in the green. Meanwhile, the dollar's trend this year of declining despite U.S. stocks and bonds rising was on full display on Monday. Wall Street closed slightly higher and Treasury yields fell as much as 5 basis points at the short end of the curve, yet the dollar slipped. Many analysts say one of the main reasons for this is non-U.S. investor hedging - more on that below. Dollar floored as investors seek that extra hedge All three major U.S. asset classes – stocks, bonds and the currency – have had a turbulent 2025 thus far, but only one has failed to weather the storm: the dollar. Hedging may be a major reason why. Wall Street's three main indices and the ICE BofA U.S. Treasury index are all slightly higher for the year to date, despite the post-'Liberation Day' volatility, while the dollar has steadily ground lower, losing around 10% of its value against a basket of major currencies and breaking long-standing correlations along the way. The dollar was perhaps primed for a fall. It's easy to forget, but only a few months ago the 'U.S. exceptionalism' narrative was alive and well, and the dollar scaling heights rarely seen in the past two decades. But that narrative has evaporated, as U.S. President Donald Trump's controversial economic policies and isolationist posture on the global stage have made investors reconsider their exposure to U.S. assets. But why is the dollar feeling the burn more than stocks or bonds? Non-U.S. investors often protect themselves against sharp currency fluctuations via the forward, futures or options markets. The difference now is that the risk premium being built into U.S. assets is pushing them – especially equity holders – to hedge their dollar exposure more than they have in the past. Foreign investors have long hedged their bond exposure, with dollar hedge ratios traditionally around 70% to 100%, according to Morgan Stanley, as currency moves can easily wipe out modest bond returns. But non-U.S. equity investors have been much more loath to pay for protection, with dollar hedge ratios averaging between 10% and 30%. This is partly because the dollar was traditionally seen as a 'natural' hedge against stock market exposure, as it would typically rise in 'risk off' periods when stocks fell. The dollar would also normally appreciate when the U.S. economy and markets were thriving – the so-called 'Dollar Smile' – giving an additional boost to U.S. equity returns in good times. A good barometer of global 'real money' investors' view on the dollar is how willing foreign pension and insurance funds are to hedge their dollar-denominated assets. Recent data on Danish funds' currency hedging is revealing. Danish funds' U.S. asset hedge ratio surged to around 75% from around 65% between February and April. According to Deutsche Bank analysts, that 10 percentage point rise is the largest two-month increase in over a decade. Anecdotal evidence suggests similar shifts are taking place across Scandinavia, the euro zone and Canada, regions where dollar exposure is also high. The $266 billion Ontario Teachers' Pension Plan reported a $6.9 billion foreign currency gain last year, mainly due to the stronger dollar. Unless the fund has increased its hedging ratio this year, it will be sitting on huge foreign currency losses. "Investors had embraced U.S. exceptionalism and were overweight U.S. assets. But now, investors are increasing their hedging," says Sophia Drossos, economist and strategist at the hedge fund Point72. And there is a lot of dollar exposure to hedge. At the end of March foreign investors held $33 trillion of U.S. securities, with $18.4 trillion in equities and $14.6 trillion in debt instruments. The dollar's malaise has upended its traditional relationships with stocks and bonds. Its generally negative correlation with stocks has reversed, as has the usually positive correlation with bonds. The divergence with Treasuries has gained more attention, with the dollar diving as yields have risen. But as Deutsche Bank's George Saravelos notes, the correlation breakdown with stocks is "very unusual". When Wall Street has fallen this year the dollar has fallen too, but at a much faster pace. And when Wall Street has risen the dollar has also bounced, but only slightly. This has led to the strongest positive correlation between the dollar and S&P 500 in years, though that's a bit deceptive, as the dollar is sharply down on the year while stocks are mildly stronger. Of course, what we could be seeing is simply a rebalancing. Saravelos estimates that global fixed income and equity managers' dollar exposure was at near record-high levels in the run-up to the recent trade war. This was a "cyclical" phenomenon over the last couple of years rather than a deep-rooted structural one based on fundamentals, meaning it could be reversed relatively quickly. But, regardless, the dollar's hedging headwind seems likely to persist. "Given the size of foreign holdings of both stocks and bonds, even a modest uptick in hedge ratios could prove a considerable FX flow," Morgan Stanley's FX strategy team wrote last month. "As long as uncertainty and volatility persist, we think that hedge ratios are likely to rise as investors ride out the storm." What could move markets tomorrow? * South Korea current account (April) * UK BRC retail sales (May) * U.S. 3-year Treasury note auction Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias. (By Jamie McGeever; Editing by Nia Williams)
India Gazette
an hour ago
- India Gazette
India-EFTA trade pact to come into force by September, says Piyush Goyal
Bern [Switzerland], June 9 (ANI): The landmark free trade agreement between India and the European Free Trade Association (EFTA) is set to become operational by September, Commerce and Industry Minister Piyush Goyal announced on Monday during his visit to Switzerland. EFTA is an inter-governmental organization set up in 1960 for the promotion of free trade and economic integration for the benefit of its four Member States - Switzerland, Iceland, Norway and Liechtenstein. Under the comprehensive pact, EFTA nations have committed to investing $100 billion in India over 15 years. Through reduced or eliminated tariffs, India is expected to provide preferential access to various European products, including Swiss watches, chocolates, and cut and polished diamonds. Speaking to reporters in Bern, Goyal said the agreement has secured parliamentary approval from all four EFTA member countries, 'By September, TEPA will be operationalised. It will enter into force,' the minister stated. He noted that while Switzerland maintains an objection period open until July 10, the summer holidays of July and August are not expected to delay implementation. During his Swiss visit, which focused on strengthening bilateral trade and investment ties, Goyal held meetings with over a dozen companies These companies have expressed particular enthusiasm for opportunities in a range of sectors including pharmaceuticals, cybersecurity, and machinery manufacturing sectors. 'There's tremendous excitement here for India,' Goyal observed, highlighting Switzerland's growing confidence in India as an investment destination. Beyond the EFTA agreement, India is actively pursuing trade partnerships with other countries. Goyal revealed negotiations with New Zealand, Chile, Peru, Oman, and the European Union. He said EU trade pact could be finalised 'faster than expected.' The minister also indicated progress on a bilateral investment treaty with the EU. Goyal emphasised India's manufacturing potential, particularly in machinery production, where the country allows 100% foreign direct investment. This strategy aims to reduce India's dependence on Chinese machinery for imports while positioning the country as a manufacturing hub. He cited the air conditioning sector as a success story, where government initiatives like the Production Linked Incentive (PLI) scheme have increased local manufacturing content from 20% to 65%, with targets to reach 80% within three years. Reflecting on India's economic progress under 11 years of NDA governance, Goyal said the country has emerged as a premier global business destination. He highlighted the presence of nearly 2,000 Global Capability Centres in India, underscoring the nation's emergence as a preferred location for both manufacturing and services. 'The world today recognises that the best place to do business is India,' Goyal said, attributing this transformation to sustained good governance and strategic policy implementation. The EFTA agreement represents another step in India's broader strategy to diversify trade partnerships and integrate more deeply into global value chains while attracting significant foreign investment to fuel domestic economic growth. (ANI)
