Stocks Slide as Dollar Slips on Trump Protectionism Speech

European stock markets are heading south, with concerns over Trump’s mover towards protectionism weighing on sentiment and weakening USD. The DAX is down along with the FTSE as a stronger Pound added to pressure on the U.K. index, which is heavily dominated by multinational companies sensitive to currency movements. The weakness on European markets followed largely lower bourses in Asia, where the Nikkei closed with a -1.29% loss as the Yen strengthened. U.S. stock futures are also down, as investors hold back and watch Trump.

UK Will Have Consultations with WTO

UK government will have informal consultations with the WTO, which comprises 163 nations, ahead of Brexit, according to a blog posting by the ambassador to the Britain’s foreign office, Julian Braithwaite. He remarked that they want membership to be comfortable, and that the UK will take its time and have patience. He also clarified that the “timing of the transition in the WTO would be linked to whatever the UK and the EU agreed in the Article 50 negotiations,” being a “necessary complement” to it. While the UK is a full and founding member of the WTO, up until now has been represented by the European Commission on most matters. The UK will now separate from EU schedules and take up a full, independent representation in the WTO, to establish a schedule of commitments ahead of Brexit.

WTI is lower by 1.3%, at $52.55, ebbing from Friday’s four-session peak at $53.47. The market is correcting after running higher into the weekend’s meeting of OPEC and other key producers, which, as expected, affirmed that most of the agreed 1.8 million barrels per day output cut had already been achieved. Data out of the U.S. on Friday, meanwhile, continues to have some resonance, as 35 new rigs were activated last week, which chimes with the narrative that’s been prevailing since prices recovered above $50, that shale production would kick-in and curtail upside potential in crude prices despite OPEC-led supply restraints.

Bundesbank warns inflation could hit 2% in January. The German central bank said in its latest monthly report that German headline inflation could be a 2% in January, which suggests the number could even be slightly above 2%, and thus above the ECB’s definition of price stability. Still, for now this is mainly due to base effects and without knock on effects headline rates should start to come down again in the second half of the year, while the ECB highlights that it remains focused on the Eurozone average, which is far lower than the German rate.