US stocks seem set to snap a six-week winning streak as investors seek phase-one trade deal clarity and after a batch of mixed European data. Chinese President Xi reiterated his nation wants equality in the phase-one trade deal, reminding the Trump administration they are not afraid of the trade war and will not flinch from such a fight. Xi’s comment also emphasized their goal in achieving financial sovereignty. China is set on opening up their $40 trillion financial market and this should remind traders that China needs foreign investment to help reach their economic goals. Xi’s comments did not reveal anything new, but served as a reminder that China is also in need of a trade deal. Risk appetite did not get a strong vote in confidence from the eurozone after preliminary PMI data showed a small rebound in manufacturing while services had a worse than expected decline.

Germany

The euro initially rallied to session highs after Germany’s manufacturing sector showed signs of stabilizing. Today’s data suggest we could be nearing the bottom for the German and French economy as improved foreign demand and trade optimism remains in place. The euro is still stuck between the 1.10 and 1.12 range and will likely remain there until we either see a phase-one trade deal done or if Boris Johnson maintains his comfortable lead as we near the December 12th election.

Lagarde

European Central Bank President Christine Lagarde’s inaugural speech revealed that ECB monetary policy will undergo a strategic review in the near future. Lagarde will carry the Draghi accommodative policy baton but will shake things up with her push for fiscal spending. The stage is set, and investors should not be surprised if Lagarde will eventually get eurozone out of negative rates.