Photographer: David Ryder/Bloomberg

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Canada in America’s trade cross-hairs, analysts say buy the dip on Chinese bonds, and tax cuts could pit Donald Trump against Paul Ryan. Here are some of the things people in markets are talking about today.

Blame Canada

Trump followed up Monday’s announcement of tariffs on Canadian softwood lumber imports with a tweet saying the U.S. “will not stand” for Canadian dairy protectionism. Commerce Secretary Wilbur Ross called the move on softwood lumber—the latest in a decades-long dispute between the two nations—part of a broader U.S. drive on the enforcement of trade laws. Lumber futures prices fell by $10, the maximum allowed on the Chicago Mercantile Exchange, on the day. The tariff also weighed on the Canadian dollar and Mexican peso, with the former hitting its lowest level versus the U.S. dollar since February 2016.

Futures Up

Chinese and U.S. stock markets are diverging in a way not seen since August 2008, with the former hitting a three-month low earlier this week. In fixed income, top analysts see opportunity in battered Chinese bonds, which they argue are well-positioned to gain once policy makers’ regulatory tightening abates. Equity futures in the region are pointing to a positive open, with the Nikkei 225 and S&P/ASX 200 contracts in positive territory as of 5:30 a.m. Tokyo time.

Trump versus Ryan?

President Donald Trump is poised to lay out the broad framework of his tax plan Wednesday, which includes cutting the corporate tax rate to 15 percent. Such a measure sets up a showdown with deficit hawks in the Republican party such as House Speaker Paul Ryan, who wants revenue-neutral alterations to the tax code. Speculation on potential Trump tax cuts is having ripple effects in metals markets: The fortunes of copper, an industrial metal, have separated from those of gold, a hedge against monetary chaos, in a way not seen since 2003.

Nasdaq 6K

The Nasdaq Composite Index topped 6,000 for the first time on record while the Dow Jones Industrial Average rose more than 200 points amid strong quarterly results from blue-chip firms Caterpillar Inc. and McDonald’s Corp. West Texas Intermediate futures snapped a six-session losing streak but couldn’t break above $50 per barrel, while safe haven assets like gold, Treasuries, and the Japanese yen moved lower.

Data on Deck

There’s a smattering of data due out from across Asia Pacific, headlined by Australian first-quarter inflation data at 10:30 a.m., set to quicken to an annual pace of 2.2 percent from 1.5 percent in Q4. The Japanese all industry activity index, slated to be released at 1:30 p.m., is projected to rise 0.6 percent month-on-month in February, an acceleration from January’s 0.1 percent advance. Industrial production figures out of Singapore are forecast to show a monthly advance of 0.5 percent, a rebound from the prior reading’s 3.7 percent retreat.

What we’ve been reading 

This is what caught our eye over the last 24 hours.