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U.S. Marines board a U.S. Marine Corps MV-22B Osprey in Helmand province, Afghanistan.

Cpl. Alejandro Pena | U.S. Marine Corps photo

U.S. President Donald Trump on Friday was to meet U.S. top advisers about negotiations with the Taliban and the potential for a political settlement that could prompt a withdrawal of American troops from Afghanistan, a senior administration official said.

On a working vacation at his golf club in Bedminster, New Jersey, Trump was to receive an afternoon briefing from U.S. Secretary of State Mike Pompeo and other advisers to get updated on the talks, which have been handled by Special Representative Zalmay Khalilzad.

The U.S. military presence in Afghanistan dates to 2001 when then-President George W. Bush launched an offensive against Al Qaeda, which the Taliban government had given haven to, after the Sept. 11, 2001, attacks.

Trump has been adamant that he would like to withdraw U.S. forces, possibly ahead of the November 2020 election, although a pullout would raise concerns among some in the national security community that the United States could be sacrificing gains it has made there.

U.S. Senator Lindsey Graham of South Carolina, a Trump ally, said any deal should allow for the United States to maintain a presence in Afghanistan.

“Any peace agreement which denies the U.S. a robust counter-terrorism capability in Afghanistan is not a peace deal,” he said in a statement. “Instead, it is paving the way for another attack on the American homeland and attacks against American interests around the world.”

The senior administration official said a decision was not necessarily expected from the Bedminster meeting, but Trump “has been pretty clear that he wants to bring the troops home.”

The negotiations with the Taliban have been centered around a potential agreement for a U.S. troop withdrawal and talks on a political settlement between the insurgents and a delegation comprising government officials, opposition leaders and civil society members.

Khalilzad also has pressed in nine rounds of negotiations in Qatar for the Taliban to renounce al Qaida, agree to prevent Afghanistan from being use as a base for extremist attacks and embrace a nationwide ceasefire while the intra-Afghan talks continue.

Both sides raised expectations that an agreement was close. Khalilzad repeatedly has said nothing is agreed until everything is agreed.

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Natural gas is one of the few trades that hasn’t worked, down 50% in 12 months



Pretty much every trade has worked on Wall Street this year except one: natural gas.

Futures prices fell to a one-month low on Friday after plunging more than 12% for the week. The commodity is currently trading around $2.34 per million British thermal units, which is nearly 50% below where it traded a year earlier. It’s down 21% for 2019.

Excess supply is pressuring prices. Inventory built up last spring following a warmer-than-expected winter, and U.S. production has climbed to a record high, according to data from the U.S. Energy Information Administration.

A milder fall season is also having an impact on prices. According to Credit Suisse, temperatures since September have been 4% warmer than they were last year, although they are 20% below the 5-year average.

Bespoke Weather chief meteorologist Brian Lovern said that since the middle of the summer the weather has been bullish, but that the excess supply is what’s keeping prices lower. Going forward he said to expect volatility as different weather patterns play out, all of which could have a drastically different impact on prices.

“From here, we feel that we will have a lot of volatility in the weather pattern, with some warming seen as we move into December (a big reason prices fell so much this week), but there will be more cold threats either late in December, or into the middle portion of winter,” he said to CNBC.

Lovern said that a “normal” winter could see prices decline to the $2.25 level while a colder-than-expected winter could “still save the market.” An uptick in demand for heat could chip away at inventory levels, in which case Lovern said prices could reach $2.75.

On the flip side, he said a rise in temperatures would be “disastrous” and could send prices well under $2.00.

While he said that the latter two scenarios are extreme and that he favors the middle of the road prediction, given the current excess supply temperatures will need to be colder than usual in order to avoid a potential glut next year.

With winter approaching colder temperatures have started to eat away at inventories. For the week ending Nov. 22 stockpiles decreased by 28 billion cubic feet — the second straight week of declines — bringing total inventory to 3.61 trillion cubic feet. The last two weeks mark a turning point, before which inventories had been steadily increasing since the middle of March.

Despite warmer fall temperatures Credit Suisse noted that it’s still early in the season and 84% of heating days are still to come.

But the Street continues to be bearish. For the week ending Nov. 12 bearish contracts outweighed bullish contracts by nearly 90,000, The Wall Street Journal said, using data from the Commodity Futures Trading Commission. This is part of an ongoing trend, which has seen traders placing net bearish bets since last spring.

But MKM Financial’s Jeff Kilburg said that the short-term selling may be about to take a breather.

“With exceptional volatility this fall and the recent large speculative short positions really pushing prices lower, this recent dip in prices may have run its course,” he said to CNBC. “I believe you have to respect the range and view the recent selling action as a Black Friday sale for Nat Gas,” he added.

For 2020 analysts are calling for an average natural gas price of $2.75, according to estimates from Reuters.

– CNBC’s Michael Bloom contributed reporting.

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Dow drops 250 points after worse-than-expected manufacturing data



Stocks dropped on Monday, the first trading day of December, as investors digested disappointing economic data along with the latest trade news after capping a month that featured blistering gains.

The Dow Jones Industrial Average fell 251 points, or 0.9%. The S&P 500 pulled back 0.9% while the Nasdaq Composite traded 1.4% lower. The major averages started off the session with slight gains before turning lower.

Shares of Facebook, Amazon, Alphabet and Apple all dropped more than 1%. Netflix traded 2.7% lower. Roku, which has been one of the hottest stocks of 2019, plummeted more than 15%.

The Cboe Volatility Index, which is regarded as the best fear gauge in the market, rose to 14.8 from 12.6.

Monday’s losses came after a strong performance in November. The major averages had their biggest monthly gains since June, rallying to record highs. The S&P 500 climbed 3.4% last month while the Dow advanced 3.7%. The Nasdaq rallied 4.5%.

A General Motors assembly worker moves a V6 engine, used in a variety of GM cars, trucks and crossovers, from the final assembly line at the GM Romulus Powertrain plant in Romulus, Michigan, August 21, 2019.

Rebecca Cook | Reuters

“The trend and momentum going into December are bullish,” said Bruce Bittles, chief investment strategist at Baird. “However, investor optimism is registering as excessive by many of the services we follow. While optimism is not euphoric, excessive investor optimism generally suggests a pause in a bull market.”

Manufacturing activity in the U.S. continued to contract last month, the Institute for Supply Management said. The ISM Manufacturing PMI dipped to 48.1 in November. That’s below an estimate of 49.4. Stocks hit their session lows after the data was released.

“All in all, this should take some wind out of the sails of the argument that the U.S. economy is accelerating going into the end of the year,” said Jon Hill, vice president of rates strategy at BMO Capital Markets.

Sentiment was also dented after President Donald Trump said China still wants to make a deal on trade, “but we’ll see what happens.” There is no clear indication of when both countries will be able to sign an agreement and last week saw fresh tension between Washington and Beijing after Trump signed legislation supporting protesters in Hong Kong. Trump said the bill signing “doesn’t make it better.”

That comment came after Chinese state media reported Sunday that Beijing wants a cancellation of tariffs for a phase one trade deal.

Trump also said Monday he will restore tariffs on metal imports from Brazil and Argentina. In a tweet, he said: “Brazil and Argentina have been presiding over a massive devaluation of their currencies. which is not good for our farmers. Therefore, effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the U.S. from those countries.”

Trump noted in a separate tweet that “U.S. markets are up as much as 21%” since his first tariffs announcement on March 1, 2018, adding the U.S. is “taking in massive amounts of money.”

The percolating uncertainty around trade came despite Axios reporting, citing a source, that Trump is expected to hold off on additional tariffs against China set to kick in this month in the hopes of striking a deal before year-end.

—CNBC’s Silvia Amaro contributed to this report. 

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Silicon Valley giants accused of avoiding $100 billion in taxes



Six of Silicon Valley’s biggest companies had a combined “tax gap” of more than $100 billion this decade, according to a new analysis.

Fair Tax Mark, a British organization that certifies businesses for good tax conduct, assessed global tax payments from Facebook, Apple, Amazon, Netflix, Google and Microsoft between 2010 and 2019. The companies are sometimes collectively referred to as the “Silicon Six.”

The research, published Monday, analyzed their 10-K filings, which are financial forms submitted by businesses to the U.S. government.

It looked at tax provisions — the amount companies set aside in their financial reports to pay taxes — and compared those to the amounts that were actually handed over to the government, referred to as cash taxes. Over the decade, the gap between the Silicon Six’s provisions and the taxes they actually paid reached $100.2 billion, researchers found.

The report noted that scrutiny of big corporations’ tax payments often focused solely on tax provisions, which was not always the final amount received by governments. It also claimed that profits continued to be “shifted to tax havens, especially Bermuda, Ireland, Luxembourg and the Netherlands.”

Researchers said the bulk of the shortfall “almost certainly arose outside the United States,” with foreign tax charges amounting to just 8.4% of the profit the companies made overseas during the decade.

Speaking to CNBC via telephone on Monday, Paul Monaghan, CEO of Fair Tax Mark, said there was an enormous difference between what companies accounted for and what they actually handed over in taxes.

“The amount of tax being paid by these businesses is $100 billion less than reported in their accounts,” he said.

Amazon was named the worst offender of the six firms, with the report claiming the e-commerce giant had paid $3.4 billion in income taxes since 2010. Fair Tax Mark noted that cash tax paid by the organization amounted to 12.7% of its profit over the decade, despite corporate tax in the U.S. being set at 35% for seven of the years included in the analysis period. President Donald Trump cut corporation tax rates from 35% to 21% in 2017.

“The company is growing its market domination across the globe on the back of revenues that are largely untaxed and can unfairly undercut local businesses that take a more responsible approach,” the report said.

Amazon finished 2018 with $232.9 billion in annual revenue and the company has a market capitalization of around $892 billion.

In an emailed statement, a spokesperson for Amazon told CNBC that the suggestions made in Fair Tax Mark’s report were wrong.

“Amazon represents about 1% of global retail, with larger competitors everywhere we operate, and had a 24% effective tax rate on profits from 2010-2018,” the company said.

“Amazon is primarily a retailer where profit margins are low, so comparisons to technology companies with operating profit margins of closer to 50% is not rational. Governments write the tax laws and Amazon is doing the very thing they encourage companies to do — paying all taxes due while also investing many billions in creating jobs and infrastructure. Coupled with low margins, this investment will naturally result in a lower cash tax rate.”

The spokesperson added that Amazon had invested 55 billion euros ($60 billion) across Europe since 2010 and £18 billion in the U.K., and had paid £793 million in taxes to the U.K. alone last year.

Facebook had the second biggest tax gap, according to the report. The cash tax it paid represented just 10.2% of the profit the company made over the decade, researchers said — the lowest proportion paid by any of the Silicon Six. Its foreign tax charge was also the lowest of the six, Fair Tax Mark noted, at 5% of foreign profits.

A spokesperson for Facebook told CNBC in an emailed statement that the company takes its tax obligations seriously, paying what it owes in every market the firm operates.

“In 2018 we paid $3.8 billion in corporation tax globally and our effective tax rate over the last five years is more than 20%,” they said. “Under current rules we pay the vast majority of the tax we owe in the U.S. as that is where the bulk of our functions, assets and risks are located. Ultimately these are decisions for governments and we support the OECD process which is looking at new international tax rules for the digital economy.”

Google was ranked third, with the report claiming its taxes amounted to 15.8% of profits, while its foreign tax charge was 7.1% for the decade.

Netflix, ranked fourth, handed 15.8% of its profit over, while Apple, in fifth, had a tax rate of 17.1% over the decade, according to the study.

“As the largest taxpayer in the world, we know the important role tax payments play in society,” a spokesperson for Apple told CNBC in an email. “We pay all that we owe according to tax laws and local customs wherever we operate, and since 2008 Apple’s corporate taxes alone have totaled over $100 billion.”

Microsoft, which paid the highest rate of tax, had a cash tax rate of 16.8%, the research showed.

“Microsoft is fully compliant with all local laws and regulations in every country in which we operate,” a spokesperson told CNBC via email. “We serve customers in countries all over the world and our tax structure reflects that global footprint.”

Netflix declined to comment on the study’s findings. A spokesperson for Google was not immediately available for comment when contacted by CNBC.

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