US stocks mixed as Trump warns China on trade

Bloomberg

US stocks were mixed after President Donald Trump said China is taking advantage of the US on trade while oil producers rallied on stronger crude prices. Treasuries fell as the Federal
Reserve started its two-day policy meeting.
US benchmarks briefly fell to their lows of the day as Trump told the United Nations that the US trade deficit with China “is just not acceptable.” Crude temporarily erased gains after Trump said OPEC nations are “ripping off the world” on oil prices, which are near a four-year high. Benchmark Treasury yields touched 3.1 percent.
Core European bonds slipped with Treasuries, but Italian notes rallied as the country crept closer to a budget proposal. The dollar drifted lower. The Stoxx Europe 600 Index headed for its seventh gain in eight days, and Japanese equities rose to the highest since January. Some caution remained on display, with emerging markets underperforming.
Riskier assets are drifting in the face of mounting political, trade and policy headwinds and investors look towards what could be a long and bruising conflict between the US and China following the Asian nation’s decision to call off planned talks after the latest round of tariffs. Adding to political concerns are reports that US Deputy Attorney General Rod Rosenstein, who oversees a probe into Russian interference in the American election, may be poised to leave his post, while the nomination of Brett Kavanaugh to the US Supreme Court continues to be mired
in controversy.
Investors are also looking forward to the Federal Reserve. The central bank’s policy meeting this week will likely see interest rates increased for the third time in 2018 and feature fresh projections for the next few years.
“What will be more interesting will be to find out” the number of rate hikes anticipated for next year, Iain Stealey, portfolio manager at JPMorgan Global Strategic Bond Fund, who expects two Fed rate hikes this year and two in the first half of 2019, said on Bloomberg TV. “Inflation is above target, so they can keep going on this sort of slow normalisation.”
Elsewhere, Brent climbed above $81 a barrel, reaching the highest since November 2014, while most metals fell. The pound added to gains made Monday when the currency was buoyed by increasing talk of a second UK referendum on the final Brexit deal.
Japanese Prime Minister Shinzo Abe meets with President Donald Trump in New York to discuss trade. The Fed decision on Wednesday will be followed by a press conference with Chairman Jerome Powell.
The S&P 500 Index was little changed in New York. The Stoxx Europe 600 Index gained 0.4 percent. The UK’s FTSE 100 Index increased 0.5 percent to the highest in more than three weeks. The MSCI Emerging Market Index declined 0.2 percent. The Nikkei 225 increased 0.3 percent.
West Texas Intermediate crude climbed 0.5 percent to $72.41 a barrel.