Clouding the G-7 gathering, which represents the world's major industrial economies, are the tit-for-tat tariffs between Washington and Beijing.Politicsread more
The Goldman Sachs technology M&A team, led by Sam Britton, has cashed in on its software focus and decades of experience to dominate 2019's biggest deals.Technologyread more
American small and medium-size companies that rely on China are scrambling to adjust their business plans in response to the escalating trade war.Traderead more
Here are the products that stand to be the most affected by China's new tariffs on $75 billion worth of U.S. goods.Marketsread more
The summit comes amid fears over a global economic slowdown, and U.S. tensions over trade allies, Iran and Russia.Politicsread more
Carl Medlock used to work at Tesla. Now he's one of the few people in the U.S. that can fix the company's original Roadster electric vehicles.Technologyread more
The world's second biggest economy is past a point where it cannot ignore its enormous debt anymore, according to an analyst.China Economyread more
Trump does have some powerful tools that would not require approval from U.S. Congress.Politicsread more
Stocks dropped after Donald Trump ordered that U.S. manufacturers find alternatives to their operations in China.US Marketsread more
As demand for lab monkeys continues to rise, U.S. scientists are reporting delays in research projects because they can't obtain enough animals, according to the National...Politicsread more
The European Union will respond in kind if the U.S. imposes tariffs on France over digital tax plan, EU chief Donald Tusk told G-7.Technologyread more
week ahead@ (Updates with Australia, Malaysia rate decisions)
May 7 (Reuters) - Following are five big themes likely to dominate thinking of investors and traders in the coming week and the Reuters stories related to them. 1/SELL IN MAY? With cross-asset volatility at record lows, it's a great backdrop for investors to load up on risk. Reams have been written on the reasons for falling volatility, but logic attributes it first to major central banks' recent tilt back into dovishness, and second to the global economy's tepid but steady expansion with few inflation surprises.
So low is cross-asset vol that a gauge compiled by brokerage INTL FcStone stands 3.6 standard deviations below the mean. In other words, it deems that a vol surge has less than a 0.02 percent probability of occurring. And with that has come willingness to go short safe assets such as gold or Treasuries, and on protective hedges such as the VIX. (The latter is a measure of how much S&P500 options are expected to fluctuate, essentially a vol gauge). Outstanding shorts on VIX futures have reached record highs, CFTC data shows, surpassing the build-up seen before last February's "Volmageddon" blowup.
Unsurprisingly, some market watchers advise caution. As Volmageddon showed, vol can spike spectacularly in a quiet market, sometimes driven by just one unexpected data point. After all, if the old adage holds, some people may be looking to sell in May and go away. -LIVE MARKETS-The flows, volatility, and shorts conundrum -Half-time: Europe Inc scores to avert Q1 disaster, hopes of a rebound rise -Corporate profits and U.S. economy chug along, defying recession fears
2/GIMME HOPE Data: more important than usual these days as markets try to decide whether the green shoots cropping up in some places are the real deal.
Take the euro zone. Growth was faster than expected in the first quarter, after slumping in the second half of 2018. U.S. and Chinese first-quarter GDP surpassed expectations, too, while the Bank of England has just raised growth forecasts for 2019.
So will upcoming data -- U.S. and Chinese trade numbers -- surprise to the upside as well? Germany releases industrial orders figures on Tuesday, and Friday brings a raft of British data, including first-quarter GDP.
For sure, one week of brighter data isn't enough to shift entrenched pessimism. So while Citi's economic surprise indexes for Europe and United States have started ticking higher, they remain in negative territory. Nor have brighter growth numbers managed to lift German 10-year bond yields much above zero percent yet. But keep watching that data.
-Factories on the mend in April but still struggling -China's Q1 growth unexpectedly steadies, but too early to call clear recovery -Bank of England ups growth view, Brexit keeps rate rise on ice
3/ "TRANSITORY" WEAKNESS? This month's Fed meeting saw Chairman Jerome Powell play down recent weakness in U.S. inflation as "transitory" and declare the policy stance "appropriate".
His failure to give any hints that the central bank was weighing interest-rate cuts disappointed the S&P500 and pushed money markets to slash rate-cut bets for this year to around 40 percent from over 60 percent. It will also have earned Powell the ire of President Donald Trump, who has slammed the Fed boss for not doing more to support the economy.
So is Powell right in his view of inflation? Some recent indicators, from first-quarter growth to factory orders to productivity, have been pretty strong. The flip side is manufacturing is growing more slowly and inventories are building. So we'll need to see whether consumer and producer inflation figures due May 9 and 10 confirm the inflation backdrop is indeed transient.
-U.S. Fed sees no strong case for hiking or cutting rates -Fed rate cut likely if U.S. manufacturing continues to slow: Kemp -U.S. factory activity at 2-1/2-year low, points to slowing economy
4/TECH TALK Forecast-smashing results from Facebook, Amazon and Apple have laid to rest any short-term worries about the so-called FAANG group of tech titans. Google and Netflix, the other members of the cohort, were less sweet but not disastrous. Hopes now are that Asian Big Tech will confirm the comeback signals -- mid-May is when China's Baidu, Alibaba and Tencent update us on their earnings.
For MSCI's global tech index, net earnings revisions are at their strongest in over six months. With 60 percent of IT companies having reported so far, almost 90 percent have beaten expectations, according to UBS. Coming after a string of downgrades before March, that's a relief.
However, global tech earnings growth is expected to slow, compared with 2018. But after two years of double-digit growth, a pullback may represent a return to normal rather than a worrying drop. It's more than likely that growth-hungry investors will return to backing big tech.
-Apple's upbeat forecast pushes market value back toward $1 trillion -Wedbush rates Uber 'outperform,' sees FAANG becoming 'FAAUNG -Wall Street's record run hits snag after Alphabet tumbles 5/RATES ON HOLD OR(R) LOWE(R) Markets were waiting to see who would cut interest rates first Adrian Orr or Philip Lowe? The Reserve Bank of Australia, run by Lowe, has decided not to. So now it's a question of what the Reserve Bank of New Zealand, headed by Orr, does on May 8. Both have the same story to tell low inflation, strong labour markets and limited room to cut interest rates. Both economies have strong links with China, where growth is slowing.
Lowe's decision to hold rates provided a boost to the Aussie dollar though he left the door open to rate cuts. Possibly the decision was also complicated by upcoming elections but analysts polled by Reuters broadly expect two rate cuts this year.
For Orr, the complication is that the new monetary policy committee now includes external members. The recent rise in the Aussie-Kiwi exchange rate has suggested there's a greater chance of a cut in New Zealand. But with the RBA on hold, the RBNZ might opt to do the same.
What's not in doubt is that Asia is in policy easing mode - Malaysia on Tuesday moved to support its economy with a 25 basis-point rate cut. Others are likely to follow. -Australia c.bank holds rates, jobs key to future cuts -New Zealand c.bank set for knife-edge rate decision next week -Malaysia c.bank, aiming to aid growth, makes 1st rate cut since 2016 -GRAPHIC-The only way is down: Emerging central banks keep cutting rates
(Reporting by Jennifer Ablan in New York, Vidya Ranganathan in Singapore and Danilo Masoni in Milan; Saikat Chatterjee and Dhara Ranasinghe in London; compiled by Sujata Rao; editing by Larry King and Andrew Heavens)