President Trump rattled Wall Street when he demanded U.S. firms move production out of China. But many have already taken steps to do so, and, in earnings calls just over the past month, dozens of chief executives have signaled plans to further diversify their supply chains amid the intensifying trade war. On Aug. 23, Trump took to Twitter, ordering American companies to "immediately start looking for an alternative to China" and urging them instead to start making their products in the U.S. In doing so, he cited the International Emergency Economic Powers Act (IEEPA) — passed in 1977 to deal with an "unusual and extraordinary threat to the national security, foreign policy, or economy of the United States." The president's threat unsettled investors, sending stocks to session lows on a day when the Dow Jones Industrial Average shed more than 600 points. Trump doubled down on Friday, attacking General Motors for its significant presence in China and questioning whether the automak..
The world of competitive video games is coming out of "stealth mode" in the United States, analysts at Needham say, and the firm believes investors should pay attention to how its growing popularity will drive future profits. Known commonly as esports, the category is essentially defined as people competing in a video game with a live audience, who is either at a venue or online. While both esports viewership and video gaming in general have grown, Needham analysts Laura Martin and Dan Medina wrote in a note to investors that the category has changed recently. That change has come through the U.S. popularity of the video games Fortnite and Overwatch, which the firm said "unmasked" the category's "economic power in 2018." "Why have you never heard of eSports? Because zero of the top 30 earning players in the world were from the US in 2018," Martin and Medina said. "Also, the top 10 professional players earned $1-2mm each in 2018, well below other professional US athletes." But the..
Wall Street suffered from whiplash throughout August as trade headlines and recession angst sent stocks on a wild ride during the last full month of summer. The S&P 500 posted 11 moves of more than 1% in 22 trading sessions for August. Those moves included three declines of at least 2.6% as well as the index's worst day of the year on Aug. 5. The Cboe Volatility Index (VIX), widely considered to be the best fear gauge on Wall Street, traded as high as 24.81 in August before pulling back to around 18. The choppy trading action this month was driven primarily by two factors: an escalation in U.S.-China trade relations and a recession signal being flashed by the bond market. As trade tensions are expected to persist and bonds keep pointing toward a recession, the market's volatile streak is expected to persist. "It's not just normal volatility. You've had this spike in these all-or-nothing trading days," said Willie Delwiche, investment strategist at Baird. "Whether o..
VIDEO2:1202:12M5S' Di Maio: If this government is formed it needs to carry out reformsSquawk Box EuropeLuigi Di Maio, the leader of Italy's Five Star Movement (M5S), is taking a tough stance with his proposed new coalition partners in Rome, saying the Democratic Party (PD) needs to accept a string of policy demands to fulfill a power-sharing agreement. Italian stocks slipped Friday afternoon after a week of solid gains. Investors had cheered the prospect of a M5S-PD pact which Prime Minister Guiseppe had been given a mandate to form earlier this week. The two left-leaning parties were due to take over from a rocky coalition between M5S and the right-wing Lega party — which crumbled last week after coming to power in June 2018. Longtime animosity between M5S and PD had made the alliance an unlikely one, but it now seems to be in doubt after fresh comments from Di Maio. When asked by CNBC's Joumanna Bercetche about concerns over another election, given low approval ratings..
VIDEO1:4001:40German finance minister holds key to more growth — not Draghi or Lagarde: CitiStreet Signs EuropeTwo top officials have tried to temper market expectations of an immediate quantitative easing (QE) package being launched by the European Central Bank (ECB). Earlier in the summer, ECB President Mario Draghi said he was looking at further options to prop up the 19-member euro zone economy, outlining that one of the possibilities included a new program of asset purchases to stimulate lending and boost inflation. Investors cheered his dovish comments with ECB members like François Villeroy de Galhau highlighting that a major bond-buying program, also known as QE, could come in the proceeding months if needed. But just as investors gear up for the ECB's next meeting on September 12, two notably hawkish members of the euro zone's central bank have decided to inject some reality back into the debate. "In my opinion, based on the current data, it is much too early for a ..
Thousands of people march from Obelisco monument to Casa Rosada to support President of Argentina Mauricio Macri in Buenos Aires, Argentina on August 24, 2019.Muhammed Emin Canik | Anadolu Agency | Getty ImagesAn intensifying bout of volatility in South America's second-largest country has stoked fears of a full-blown financial crisis, with analysts warning Argentina could soon register its ninth sovereign default. It comes after embattled President Mauricio Macri pledged to "re-profile" roughly $100 billion in debt this week. The plan, which requires congressional approval, was an attempt to shore up confidence in financial markets ahead of a presidential election later this year. In response to the news, government bonds and the super-sensitive peso sold off on Thursday, as market participants deemed the proposal to be insufficient in tackling the country's severe financial troubles. Standard & Poor's (S&P) also announced it had slashed Argentina's long-term credi..