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A roundup of what The Globe and Mail’s market strategist Scott Barlow is reading today on the Web

Between potential trade wars and European political risk, the overriding theme this week has been the dangers of investor complacency.

Domestically, the impression is that many Canadians felt like NAFTA would somehow just work out ok. For those with access to the Financial Times, there’s a podcast noting that “Markets were guilty of complacency about Italy”

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Key links:

“Global trade skirmish puts factories, recovery at risk” – Report on Business

“What analysts say about trade war” – Babad, Report on Business

“Chocolate vs. steel: A look at Canada’s strategic tariff retaliation strategy” – CBC

“@SBarlow_ROB RBC on tariff impact: manageable, “broader risk is that the U.S. tariffs, and the retaliatory trade measures they give rise to, will ultimately turn into a global trade war” – (research excerpt) Twitter

“‘A slow-motion train wreck’: Trump is kicking off a trade war with America’s closest allies” – Business Insider

““Tariffs are totally unacceptable”: Trudeau” – Reuters (video)

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Crude prices are stable Friday but set for another weekly loss. U.S. oil production is now at record levels – higher than the previous peak in 1970 – and this has created an US$11 gap between West Texas Intermediate and Brent crude prices,

“U.S. crude production has been rising to record levels since late last year. In March, it jumped 215,000 barrels per day (bpd) to 10.47 million bpd, a new monthly record, the Energy Information Administration said on Thursday… “The move on that spread is difficult to anticipate as it does not necessarily react to news, headlines etc.. One can be long or short on either of the benchmark and be stopped-out by the volatility of the Brent-WTI,” Petromatrix said in a note.”

“Brent premium over WTI hits new 3-year high” – Reuters

“Oil prices are backing down. Here’s a look at why this is happening,” – Bloomberg

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Deutsche Bank had its credit rating seriously downgraded, and the FT argues this poses a bigger risk to financial markets than Italy’s political upheaval,

“While all eyes have been on Italy, the debt and equity of the eurozone’s most systemically important bank have been flashing red … anyone who has any money invested in Europe may want to pay close attention to this [high risk Deutsche Bank] bond, which carries a coupon currently yielding 5.87 per cent and was described by one distressed debt investor as possessing “the most systemically important coupon in Europe.” Investors in these instruments are expressing a view that the chance of Deutsche Bank falling into more serious trouble has significantly increased since the start of the year. “

“Deutsche Bank’s systemic risk puts Italian lenders in the shade” – Financial Times (paywall)

“Deutsche Bank CEO: Our financial strength is beyond doubt” – Reuters

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Tweet of the Day:

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Diversion: “I’m nothing but compost’: Bill Murray on good friends, bad bosses and Harvey Weinstein” – Guardian

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