This year, the US stock market has experienced considerable fluctuations, yet these ups and downs have not affected the relatively stable bull market in securitized real estate shares. Following a recent decline in the tech sector, real estate investment trusts (REITs) have emerged as the leading performers in the US equity sector for the year, according to a selection of exchange-traded funds.
Trump: Further progress needed to avoid new tariffs on Mexico: BBC
US plans arms package for Taiwan amid China’s protests: Bloomberg
Fed’s Beige Book: US economy has expanded at a ‘moderate pace’: MW
German factory orders unexpectedly rose in April: Bloomberg
Are markets overestimating the likelihood of a Fed rate cut? CNBC
Oil prices have fallen due to a weaker economic outlook: NY Times
Global growth slowed to a three-year low in May: IHS Markit
US ISM Non-Manufacturing Index rose more than anticipated in May: CNBC
US Services PMI for May indicates the slowest growth since 2016: IHS Markit
US private employment growth sharply declined in May: ADP
Current indications of a potential US recession are growing, especially following an inverted yield curve. Specifically, the gap between the 10-year and 3-month yields has sparked a surge of recession predictions. However, some analysts highlight that another notable yield spread—the difference between the 10-year and 2-year yields—remains positive, albeit slightly. So, what should an informed investor do? Exercise caution and wait for both spreads to confirm a recession outlook before making drastic investment decisions.
Senate Republicans oppose Trump’s tariff plans on Mexico: NY Times
Mexican officials are meeting with VP Pence today to discuss tariffs: Reuters
Trump mentions ‘always a chance’ of military action against Iran: CNBC
Fed’s Powell is open to rate cuts if necessary: WSJ
World Bank has lowered its global growth forecast for 2019: WB
US auto sales rebound in May: Yahoo Finance
US factory orders had a subdued 1-year trend in April at +1.0%:
The Global Market Index’s (GMI) risk premium outlook decreased in May, falling to an annualized 4.5%. This figure represents a notable decline from the 4.8% estimate in last month’s update. The current GMI revision, which is an unmanaged, market-value-weighted portfolio encompassing all the major asset classes (excluding cash), reflects the expected premium over the projected “risk-free” rate for the long term.
Fed’s Bullard indicates a rate cut may be imminent: CNBC
Big tech faces a potential issue with a new US antitrust investigation: Reuters
Australia’s central bank cut interest rates: MW
An increasing number of companies expect climate change to impact their business: NY Times
Global manufacturing activity declined in May: IHS Markit
Weakness in the residential housing sector adversely affected US construction spending in April: AP
Manufacturing PMI for the US hit its lowest level in nearly a decade: IHS Markit
US ISM Manufacturing Index fell in May, indicating the weakest growth since 2017: MW
Global stock markets faced a downturn in May as trade-related concerns impacted projections for the worldwide economy. This decline in market sentiment led to a significant influx of investment into US bonds, as investors sought a refuge in safer assets during last month’s uncertainty.
China and Mexico are willing to discuss trade issues with the US: WSJ
Could Trump’s trade policies jeopardize the longest US economic expansion in history? MW
Trump expresses skepticism about the Middle East peace plan: Politico
Trump criticizes London’s mayor ahead of his UK visit: Bloomberg
The Trump administration considered imposing tariffs on Australia: The Hill
The Eurozone manufacturing sector continued to contract in May: IHS Markit
UK Manufacturing PMI sharply declined in May, indicating a contraction: IHS Markit
The White House’s chief economist, Kevin Hassett, will leave soon: NY Times
Revised data reveals that strong US consumer sentiment ‘eroded’ in late May: UoM
Is the inverted 10-year-3-month yield curve signaling a recession? Perhaps not: Econobrowser
US consumer spending‘s 1-year trend decreased to a moderate +4.3% in April:
By Michael O’Sullivan
Summary via publisher (Public Affairs Books)
The world is at a pivotal moment reminiscent of the collapse of communism. During that time, many concentrated on the fall itself, neglecting a more significant shift—globalization—that was taking shape. Although globalization has brought many advantages through the free exchange of money, ideas, people, and trade, it has also created disparities, leading to wealth inequality, considerable debt, and political recessions across economies. This transition encapsulated by Michael O’Sullivan as “the levelling” signifies a major reconfiguration in economics and power dynamics worldwide. The future points toward a more balanced distribution of wealth among countries, renewed accountability from political elites to the public, and a shift in financial authority away from traditional institutions like the WTO and the IMF.
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No model can encapsulate it fully; no analyst can grasp its entirety. Yet, it remains influential, especially as we approach the 2020 election cycle. The phenomenon known as the Trump factor continues to astonish, offering supporters a cause for celebration while providing critics with fuel to oppose his policies. The pivotal issue remains whether the ongoing and intensifying trade battle will bolster or hinder the US economy in the short and long term. At this point, uncertainty looms, as Trump’s trade-related decisions evolve almost daily, heightening the stakes.
