**Trump May Cut a Deal with China as Markets Bet on Fed Easing: Jefferies Comments**
Markets are currently underestimating the likelihood of a U.S.-China trade deal before the end of October, according to Jefferies strategist Christopher Wood. Such an agreement would represent a temporary détente between the world’s two largest economies and could extend this year’s risk rally.
### Quick Insights
– Jefferies’ Christopher Wood argues that markets are overlooking the probability of an imminent trade deal. If realized, this could sustain the current risk rally and reduce the “uninvestable” label on China for U.S. fund managers.
– Investment in AI infrastructure continues to drive U.S. stocks higher. This momentum is fueled by increasing capital expenditures enabled through technology partnerships, alongside growing expectations of Federal Reserve easing. Notably, the AI “bubble” has not yet peaked.
– The report takes a structurally bearish stance on the U.S. dollar, citing ongoing fiscal pressures. Conversely, it advocates for continued upside in gold prices, highlighting gold’s historical outperformance against the dollar since 1971 and persistent fiscal concerns.
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