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President Trump and China’s President Xi met over the weekend and agreed to restart trade talks, a positive for the markets. At home, the first Democratic presidential debate produced no clear winner.
HOW MARKETS REACTED
U.S. markets (S&P 500 Index: -29bps) ended last week down slightly while international (MSCI EAFE Index: +59bps) and emerging markets (MSCI Emerging Markets Index: +15bps) were modestly positive. Investors mostly took a wait and see approach with an eye on the long-anticipated Trump-Xi meeting at the G20.
WHAT THIS MEANS
Assets in money market funds reached new highs, as measured by the Investment Company Institute. In spite of the strong start to the year on the part of equity markets, money still remains on the sidelines, providing potential support for equities.
WHAT TO WATCH
The U.S. jobs report for June is due out on Friday (7/5), and China, Japan, and the U.S. will all have updated readings to the Purchasing Managers Index (PMI), providing some insight into the strength of manufacturing.
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