Dear valued client,
Markets posted gains for the third week in a row as companies posted strong Q3 earnings reports and optimism is permeating across Wall Street about the possibility that interest rates have hit their peak. This sentiment was reinforced this week when the U.S. inflation report came in at 3.2% (compared to 3.7% in Sept. and August). Another rally in the equities markets to end the year would certainly be a nice Christmas present for investors.
Joe Biden and Chinese President Xi Jinping met in San Fransisco on Wednesday as the leaders of the two largest economies in the world looked to improve relations. Tensions between Beijing and Washington have escalated in recent years over trade and China’s growing geopolitical ambitions. By all accounts the meeting was fruitful; they pledged to restore high-level communications channels between their militaries and discussed measures Beijing will take to limit production and shipment of the deadly opioid fentanyl. Biden told reporters these talks with China constituted “some of the most constructive and productive discussions” he’s had with them. Xi, in turn, stated, “Planet Earth is big enough for the two countries to succeed.” Perhaps China was looking for indirect ways to remedy some of its domestic problems including its aging population, sputtering real estate market, exodus of foreign investment, and declining value of its currency.
Meanwhile, in the Middle East, Israeli forces reached the gates of Gaza’s main hospital, Shifa, on Monday. Experts say this was their primary target in their battle to seize control of the northern half of the Gaza Strip. Intel suggests Hamas has been using the tunnels below Shifa as a command center. Hamas has denied using hospitals in this way. PM Benjamin Netanyahu said the military intends to evacuate all patients before infiltrating. The Washington Post reported Thursday Israel is contemplating a deal, brokered by Qatar, that Hamas has agreed to in principle for the group to release at least 50 women and children among the 240 hostages being held in Gaza in exchange for a three-to-five day ceasefire to allow more humanitarian aid into the region as well as the release of some women and children from Israeli prisons. Much of the negotiations have centered around how long a ceasefire Israel will agree to. If the deal moves forward, it would be the biggest release of hostages since the war began on Oct. 7th.
“If your first objective in the negotiation, instead of making your argument, is to hear the other side out, that’s the only way you can quiet the voice in the other guy’s mind. But most people don’t do that.” – Christopher Voss
Have a terrific weekend,
PW
