Funda and political wrap: Trump "US ‘Cannot lose steel industry’", N.Korean gesture raising hopes for peace

The political and fundamentals of today's markets have been flowing with a flurry of headlines over the N.Korean gesture raising hopes for peace on the Korean peninsula. South Korean president Moon Jae-in said the North was willing to meet with the US to discuss denuclearization and that while such talks continued, it would not test missiles. At the same time, risk has rallied where concerns over the trade war have been abated; Trump said to be open to changes in tariffs. 

At the time of writing, the VIX is at 18.29 -2.35%, the DXY is lower by -0.52% below the psychological 90.00 level at 89.61 and the US 10-yr yield is down -0.13% at 2.8771%.

Key headline by category as follows: (Sources: RRTS, LiveSquawk, Guardian, FT)

Washington:

• US Pres. Trump: Possible Progress Being Made In Talks With North Korea.
• US VP Pence; ‘All Options Are On The Table’ Regarding N.Korea.
• US VP PenceUS Must See Steps Toward Denuclearization.
• US Pence on North Korea: "Our posture toward the regime will not change until we see credible, verifiable, and concrete steps toward denuclearization." - ABC.
• US President Trump, Commenting On North Korea, South Korea Planned Summit, Tweets "We Will See What Happens".

•  When US Has Deficit With Many Other Countries, ‘Trade Wars Aren't So Bad’.

Latest from Trump on trade war noise:

• US Pres. Trump: Reiterates Plan To Implement Steel Tariffs.

• US ‘Cannot Lose Steel Industry’.

• US Pres. Trump: EU Has Been ‘Particularly Tough’ On US, Makes It Difficult To Do Business.

NAFTA/Trade/Tariffs

• Fitch: US Steel Tariffs Up Trade Risks But Sector Impact Limited.
• US Tsy Sec. Mnuchin: Russia Sanction To Be Released ‘Very Shortly’ - RTRS.
• US Treasury’s Mnuchin: Steel & Aluminium Tariffs Would Not Apply To Canada And Mexico If NAFTA Negotiations Are Successful.
• Stocks Rebound Off Session Lows On Speculation That US Pres Trump Is 'Open To Tariff Changes, Citing Senator Purdue (A Well Known Trump Ally).
• US Senate Republican Leader McConnell: ‘A Lot Of Concern’ That Planned Tariffs Could Spiral Into Trade War - RTRS.
• Canadian Fin Min Morneau: Linking Steel, NAFTA Isn’t Going To Help US Get A Better NAFTA Agreement - RTRS.
• Canadian For Min Freeland: Canada Will Defend Against ‘Unacceptable Tariffs’.
• US Senate Democratic Leader Schumer: Trump's Planned Tariffs Are Not ‘Well-Targeted,’ Should Target China - RTRS.

Brexit/ EU politics

• Italy's Salvini: Believes ‘He Is Only Possible PM Candidate’ For Centre-Right After Election Result - RTRS.
• UK Brexit Sec. Davis: There Are 11 Areas Of Contention On Brexit Legal Text.
• DUP’s Foster: EU Plan To Avoid Hard Irish Border Unacceptable – Guardian.
• European Parliament's Brexit Coordinator Verhofstadt: He Wants A Special, Specific Arrangement For Britain After Brexit.
• UK PM May 'Double Cherry-Picking' On Brexit, Says Leaked EU Report – Guardian.
• French FinMin Le Maire: France Is Not Taking ‘Toughest Stance’ In Brexit Negotiations.

Central Banks

•  BoE Admits QE Policy Has Harmed UK Productivity – FT.
• Fed’s Kaplan: Base Case On Rate Hikes Hasn't Changed, It Is Three For This Year.
• Fed’s Kaplan: We Think Jobless Rate To Go Below 4% This Year.
• Fed’s Kaplan: We Are Either At Or Beyond Full Employment Now.
• Fed’s Kaplan: Fed Should Get Started Soon On Tightening Policy.
• Fed’s Kaplan: Higher Bond Yields Tied To Better Growth, More Supply.

DATA

• NZ Change in Whole Milk Powder 06-Mar: -0.8% (prev 0.3%).
• Dairy Auction Whole Milk Powder (MT) (USD) 06-Mar: 3232 (prev 3246).
• NZ Change in GDT Price Index 06-Mar: -0.6% (prev -0.5%).
• Dairy Auction Avg. Winning Price (MT) (USD) 06-Mar: 3593 (prev 3623).
• US Factory Orders (M/M) Jan: 1.4% (est -1.3%; prev R 1.8%).
• Factory Orders Ex Transportation (M/M) Jan: 0.4% (prev R 0.9%).
• Durable Goods Orders Jan F: -3.6% (prev -3.7%).
• Durables Ex-Def Jan F: -2.6% (prev -2.7%).
• Durables Ex-Transportation Jan F: -0.3% (prev -0.3%).
• Nondef Cap Ex-Air Jan F: -0.3% (prev -0.2%).