Investor Hopes Pinned on “Negotiations”, “Talks”, “Deals” and “Concessions”

The administration takes a hardline stance on counter-retaliation…

Highlights

• The administration takes a hardline stance on counter-retaliation…

• … but markets rally on the tiniest hint of negotiations

• Bear market rallies are historically common

• Treasury yields rise as investors rebalance

Key Takeaways

• Markets Focus on Hints of Negotiation: Except for China, the rest of the world has blinked. The markets are focused more on the U.S. “negotiations” with Japan and less on the escalating tit-for-tat tariff war with China (the President now doubling up and threatening a 104% tariff rate after Beijing announced a matching 34% levy on the U.S.), sending global equity prices sharply higher here in the early going.