Stock markets were mixed this week, but many were up. European markets started with a decline, but recovered during the week. American stocks started well, but lost their profits on Tuesday. On Wednesday, US markets were closed due to Independence Day, but turned positive again on Thursday. Emerging markets were weak.
There is still some turmoil coming from the possibility of more trade tariffs on 6 July. China announced higher trade tariffs for cars produced in the United States, but added on Wednesday that they will not implement tariff measures ahead of the US. In response, German Chancellor Merkel warned for a trade war which could be the result of escalating trade tariffs.
Previous week, it was announced that all American banks passed the US Fed’s second stress test. Deutsche Bank was the only major financial institution that failed. The Fed raised moderate concerns about Goldman Sachs and Morgan Stanley that will limit their ability to increase dividends and buy back more stocks. This week, the Wall Street Journal reported that Goldman Sachs and Morgan Stanley did not pass the stress test either, but made a deal with the Fed to freeze their pay-outs and avoid failing. The deal marked a significant change in the banking regulatory environment resulting from Trump’s policies.
This week, the Responsible Mining Index was introduced. None of the mining companies in the world got an adequate score. The index is looking at the way companies operate in relation to their employees, the environment and human rights. It also pays attention to the way the mining activities contribute to the development of a country. Anglo American scored best, but its score is still below adequate. The mining sector faces a lot of sustainability issues. Last week, for example, a corruption and money laundering probe was launched in the US against Glencore, after which the stock tumbled 8%.