Morning Agenda: Despite Political Discord Over Taxes, Markets Still Rise

But the Dow’s rise nearly mirrors a fall in the dollar. Currencies including the euro, the yen, the renminbi and the Mexican peso have been climbing against the dollar, while trillions of dollars slosh around the global economy to places where investors can receive a higher return, whether that’s junk bonds or Dow stalwarts like Amazon.

The slip in the dollar has also been matched by tough talk on trade from the Trump administration.

The White House is said to be preparing to open an investigation into China’s trade practices as concerns intensify about the country’s efforts to make itself a global leader in microchips, electric cars and other crucial technologies. The inquiry would focus on reported Chinese violations of American intellectual property.

Related Reading

• Eduardo Porter examines the risk that Mr. Trump’s tax overhaul may amount to nothing more than a big tax cut with nothing to pay for it.

• In France, President Emmanuel Macron is facing an uproar after blocking the takeover of a shipyard and then nationalizing it. Mr. Macron had promised to protect the shipyard, STXFrance, the nation’s largest, from falling into foreign hands. Could the man who campaigned to make France more business friendly by attracting foreign investment and easing regulatory complexities now be taking the same interventionist approach of his predecessors?

China Deals Watch

• Dalian Wanda has become one of China’s largest real estate and entertainment conglomerates, helped by political connections and a huge pile of debt.

But its empire is being dismantled as the government wants the company to reduce that debt, in case it becomes a threat to the financial system.

Wanda sold theme parks that covered more floor space than all the offices in Manhattan in a $6.5 billion deal. It off-loaded 77 hotels at a fire sale price of $3 billion.

The conglomerate is a shadow of its former self. And, as The New York Times found in Wuhan, where Wanda has poured in money, it is still far from being the grand rival to Disney that the founder, Wang Jianlin, boasted of.

• Two more HNA deals have run into trouble, according to Reuters, which cites people familiar with the process.

Its $264.4 million deal for International Currency Exchange, based in London, and its takeover of Rezidor Hotel Group in Sweden have faced regulatory roadblocks.

As DealBook has mentioned, HNA’s investment in Deutsche Bank and its deal for SkyBridge Capital are also under scrutiny.

• The campaign to make China’s biggest deal makers hold a yard sale has so far been rather selective, Pete Sweeney writes in Breakingviews.

But executives are likely to feel uncomfortable holding onto trophy assets that leave them open to political attacks, so they will consider reasonable offers.

We’re Not ‘Cashed-Up Fools’

The man who has invested in a circus and a margarine company wants to eliminate irrational investments.

Guo Guangchang, the chairman of Fosun International, has already backed the crackdown on overseas investments. He expanded on his thoughts in a LinkedIn post.

– “It can certainly eliminate a lot of irrational investments and therefore potential threats to financial security. Moreover, if we don’t take action, foreigners may think of Chinese enterprises as cashed-up fools.”

– “As one of these Chinese enterprises, I believe my fellow Fosun classmates have experienced both the bitterness and sweetness. There are always people looking at us through a magnifying glass, including rating agencies, partners and portfolio companies. They will scrutinize details especially when we invest in core industries, such as financial assets.”

– “Chinese enterprises entering overseas markets will inevitably affect the established interests there. I do not believe in conspiracy theories, but I feel some people will always exaggerate. For instance, the Chinese government’s plan to regulate Chinese companies’ overseas investment is quite normal. But this plan was used as a pretext to short Chinese companies. Are these actions motivated by certain interests? Is this because our overseas development has impacted the foreign established interests?”

European Bank Cuts Funds to VW

In another blow, Volkswagen has been barred from receiving European Union research financing because it has been accused of misusing a previous loan to cheat on emissions.

The German carmaker will no longer have access to the low-cost financing it needs to keep up with research and development as the auto industry undergoes a period of upheaval.

The European Investment Bank was harsh in its critique of the company.

“VW is an excellent company,” Werner Hoyer, the president of the European Investment Bank, said in a statement, “but it has not been served well by its top management since the beginning of this affair. The thousands of wonderful people who work for VW must feel betrayed.”

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