Finance

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Good morning, Bull Sheeters. The global rally in stocks continues this morning. Investors again are pinning their hopes on big fiscal stimulus packages and the further reopening of the global economy.

Let’s see where investors are putting their money.

Markets update

Asia

• The Asian indices are all in the green in afternoon trade, with Japan’s Nikkei and Hong Kong’s Hang Seng leading the way.
• There’s big optimism that Japan and South Korea will unveil new spending plans to launch their economies out of recession.
• Brent is climbing again this morning. All signs are that Saudi Arabia and Russia will agree to further output cuts on a June 9 conference call.

Europe

• European bourses climbed out of the gates again this morning, with London’s FTSE and France’s CAC up roughly 1% at the open.
• Angela Merkel didn’t get the €100 billion stimulus plan she was seeking yesterday to reinvigorate Europe’s biggest economy. Talks resume in the German capital. The Dax is trading as if it’s a done deal.
• Staying with Germany… Volkswagen agreed to invest

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Goldman Sachs Group Inc. has effectively bowed to pressure from the continuing rally in U.S. stocks and abandoned its call for another steep sell-off.

Strategists led by David Kostin have rolled back their prediction that the S&P 500 would slump to the 2,400 level — over 20% below Friday’s 3,044 close — and now see downside risks capped at 2,750. The U.S. equity benchmark could even rally further to 3,200, they wrote in a May 29 note.

“The powerful rebound means our previous three-month target of 2,400 is unlikely to be realized,” the strategists wrote. “Monetary and fiscal policy support limit likely downside to roughly 10%. Investor positioning has oscillated between neutral and low and is a possible 5% upside catalyst.”

The shift came just after JPMorgan Chase & Co.’s strategists shifted in the other direction — reining in their bullish outlook. JPMorgan’s Marko Kolanovic warned about rising U.S.-China tensions in a note May 28.

Goldman’s strategists maintained their year-end target of 3,000 for the benchmark U.S. stock gauge.

Goldman continues to argue that short-term returns are skewed to the downside — “or neutral at best” — thanks to the risk of an economic, earnings, trade or political “hiccup” to …

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Would you load up an RV and hit the road to avoid flying for a summer trip?

If the answer is yes, you’re in good company. As the coronavirus crisis has battered the travel and hotel industries, many would-be summer vacationers are uneasy about flying, which means plenty of Americans will likely be hitting the road.

In fact, according to a survey conducted in early May by MMGY Global for the U.S. Travel Association, only 18% of travelers feel safe taking a domestic flight, while the same percent feel safe at a hotel or resort. Meanwhile, the majority (some 68%) feel safest traveling by personal cars, and roughly a third of travelers feel safest in parks.

Cue the RV. According to new reports, RV dealers are already seeing a big uptick in demand for the social-distance-friendly vehicles. In fact, “early feedback is there seems to be a lot of incremental demand for RVs, whether to own them or to rent them, because it allows you to vacation without being too close to your peers,” says Jefferies’ Bret Jordan.

And given the environment, that’s not too much of a surprise.

“I can certainly see where there’s a short term recovery and …

President Donald Trump is expected to hold a news conference on Friday to announce new measures against Beijing in response to its approval of a controversial national security law in Hong Kong. The Hong Kong government is worried that it will end up bearing the brunt of Trump’s retaliation.

On Wednesday, Secretary of State Mike Pompeo reported to Congress that Hong Kong—one of two Special Administrative Regions in China—could no longer be considered autonomous enough to qualify for special economic treatment from the U.S., paving the way for Washington to revoke the city’s unique privileges.

While revoking Hong Kong’s special trade status is the most obvious means of retribution, it’s not the most effective if the U.S.’s end goal is to punish Beijing. In fact, it would leave Washington’s main target largely unscathed.

“Practically, in Hong Kong-U.S. relations, any sanctions are a double-edged sword that will not only harm the interests of Hong Kong but also significantly those of the U.S.,” the Hong Kong government said in a lengthy statement Thursday.

To inflict real economic pain on Beijing, the U.S. would have to trigger what experts call the ‘nuclear option:’ cutting Hong Kong off from the U.S. …