“Energy traders will likely remain skeptical of the relationship between the U.S. and China if the Chinese fail to quickly make up for the shortfall with their promises of agricultural goods (purchases)”
Yesterday, the European Union told the Chinese government that if it insists on imposing the new security law on Hong Kong it should expect “very negative consequences”.
“We also conveyed that China risks very negative consequences if it goes forward with imposing this law,” said the European Commission President, Ursula von der Leyen about the talks that the EU representatives held with Chinese Premier Li Keqiang and President Xi Jinping, “The European Union is in touch with our G7 partners on this topic and we’ve made our position very clear to the Chinese leadership today and urged them to reconsider,” she added.
In response, the Chinese foreign ministry said that the Hong Kong issue is a domestic affair and that they won’t tolerate any foreign interference.
On the other hand, US President Donald Trump tweeted yesterday that the trade deal with China is intact, provided that the Chinese continue honoring the terms of the agreement.
“The China Trade Deal is fully intact. Hopefully, they will continue to live up to the terms of the Agreement!,” tweeted Trump.
Trump’s tweet came right after the press report that the White House trade adviser Peter Navarro said that the trade deal was “over”, explaining that it fell apart due to the United States’ anger against the Chinese, given that they didn’t warn other countries against the spread of the Covid-19 pandemic on time. Afterward, Navarro claimed that his comments were taken out of context.
Trump’s tweet affected the market sentiment in a positive way, pushing up the stock markets. The S&P 500 advanced 0.65 percent, closing at the 3,117.86 level. The Dow Jones Industrial Average added 0.59 percent, closing the session at 260.32, while the Nasdaq 100 increased 1.22 percent, closing yesterday’s session at 0,130.33.
Oil prices also advanced in yesterday’s session. West Texas Intermediate Crude Oil Futures advanced 1.53 percent, closing at the 40.46 level, while Bren oil futures gained 2.01 percent, closing at 43.08.
“These comments from Navarro came out of nowhere,” said an analyst at OANDA, “Energy traders will likely remain skeptical of the relationship between the U.S. and China if the Chinese fail to quickly make up for the shortfall with their promises of agricultural goods (purchases),” he added.
According to IHS Markit’s flash composite Purchasing Managers’ Index, Germany’s private sector is recovering from the recession that was caused by the Covid-19 sanitary crisis.
The Purchasing Managers’ Index went up to 45.8 in June, after being at 32.3 in May. This shows that despite it’s still contracting, the German private sector is recovering.
By 7:55 GMT the Euro gained 0.37 percent against the US dollar, hitting the 1.1300 level. Conversely, it gained 0.14 percent against the Pound Sterling, at 0.9045.