trade war

TRADE WAR GROWTH JITTERS

Stocks opened lower after some disappointing economic news out of China. The Dow is currently down 214 pts and the SPX is down .6%. Technology and communications sectors are down over 1% in early trading. On the other hand, financials, real estate and consumer staples are modestly higher. The bond market is gaining momentum today as yields fall. The 10-year US Treasury Note yield edged down to 1.73%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

TRADE TALKS IN THE DRIVER'S SEAT

The major stock market averages surged higher this morning (Dow +430 pts; SPX +1.5%). Ten of eleven sectors are in the green, led by materials (+2.4%), industrials (+2.2%) and financials (+2%). Only the utilities sector has been left out (-.2%). Though trite, the reason given for this rally is “Trade Optimism,” according the Bloomberg. So we continue to trade in a range, knocked around daily by Tweets and vague headlines. In this case, President Trump Tweeted that “Good things are happening at China Trade Talk Meeting.” European stock markets closed sharply higher as well this morning, and Asia was up 1-2% last night. Commodities reacted as one might expect—gold fell 1% and oil rallied 1.4% to trade around $54.30/barrel. Bonds not surprisingly sold off. Long-term Treasury bonds are down more than 1% in early trading and high-grade corporates are down roughly a quarter of a percent. Only junk bonds, which typically trade along with the stock market, are modestly higher. The 10-year US Treasury Note yield climbed back to 1.75%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

TRADE WAR ESCALATION

Stocks sank at the open on trade war escalation (see below). The Dow is currently down 305 pts and the SPX is down 1.4%. All eleven major market sectors are in the red. Semiconductor stocks are faring the worst; the Philadelphia Semiconductor Index (SOX) is down 2.7%. The VIX Index, a common measure of trader fear—shot back up to 19 in early trading. Commodities are trading mostly lower, except gold. WTI crude oil backed down to $52.30/barrel. Safe-haven Treasury bonds are in rally mode today. The iShares 20+ Year Treasury Bond ETF (TLT) is up .6%. So the mood is clearly risk-off.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

JOBS REPORT A SIGN OF STABILITY, NOT SLOWDOWN

Stocks opened mostly higher this morning (Dow +136 pts; SPX +.7%), rebounding a bit from this week’s rout. The tech sector is up 1.2%, and most other cyclical sectors are in the green after the monthly jobs report (see below). Only energy stocks are in the red despite higher oil prices today. The VIX Index, which spiked over 20 on Wednesday, fell back to 18. VIX November futures fell back to 19, suggesting his week’s market decline is just a blip. European markets closed up by about .5% in today’s session. Commodities are mostly higher on the day. WTI crude oil is up 1% to trade around $52.90. Gold is roughly flat after having surged 17% so far this year. Bonds are rallying right along with stocks this morning. The iShares 20+ Year Treasury Bond ETF (TLT) tacked on another .6% in early trading. The fund is up almost 20% this year. And yes, that means it has outperformed the stock market. Even intermediate term high-grade corporate bonds are up more than 10% this year.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

TEMPER YOUR ENTHUSIASM

Stocks opened higher on misplaced optimism over upcoming trade talks, but quickly faded. The Dow is currently down 30 pts and the SPX is down .2%. Defensive sectors are leading the way (utilities, consumer staples). The energy is sagging, down 1.2% in early trading. Other key groups are down as well, including banks, semiconductors and biotechs. The VIX Index edged back up to 16 this morning and VIX October futures are trading up around 17. Those are fairly low levels, and with the stock market near all-time highs traders are expecting some type of sell-off in the near-term. Commodities are down on the day, with oil down 1% to $57.60/barrel. Gold is taking a breather after having surged 18% so far this year. Bonds are trading higher across the board today as yields continue to slide. Long-term Treasuries are up about .8% and intermediate high-quality corporates are up about .25%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

FED DAY!

Stocks gapped down at the open (Dow -85 pts; SPX -.3%). Industrials, energy and financials are leading the way (all down .5% or more). Only utilities are powering ahead (+.5%). The Trump Administration asked the US Treasury to dramatically increase economic sanctions on Iran after concluding its culpability in a recent oilfield attack in Saudi Arabia. European markets are poised to close up by about .3% and most of Asia was modestly lower overnight. Commodities are trading lower today. Copper is down .3%; iron ore fell more than 3%. Oddly enough given geopolitical tension, WTI crude is down 1% to trade around $58.70/barrel. Bonds are mostly higher on the day, except for junk. The 10-year Treasury Note yield fell back to 1.75%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

BETTER DATA = BETTER MARKET

Stocks opened modestly higher today (Dow +51 pts; SPX flat). The materials sector (+1.3) is leading the way, along with financials (+1%) and industrials (+.8%). On the other hand, defensive sectors like utilities and consumer staples are down. The immediate reason is better than expected economic data (see below). The VIX Index fear gauge fell to 13.6 and stock markets around the world rallied today. Commodities are mixed. WTI crude oil is flat around $55/barrel. Copper surged 2%. Gold is down about .6%. Bonds are selling off hard today after enjoying a huge rally from the end of February to the end of August. The 10-year Treasury yield has backed up to 1.88% from 1.50% this month.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

WELCOME ENCOURAGEMENT ON THE ECONOMY

Stocks gapped up at the open, continuing yesterday’s rally. The Dow is currently up 440 pts and the SPX is up 1.3%. The more cyclically sensitive sectors—industrials, financials, energy, tech—are up well over 2% in early trading. On the other hand, defensive sectors near all-time highs are selling off today (i.e. utilities, real estate). The VIX Index fell back to 16 and VIX October futures fell to 18. In other words, traders aren’t expecting a massive jolt of market volatility over the next 30-60 days. The reaction in commodity markets isn’t surprising: gold fell and copper rose. Even oil, which has had a hard time lately, is back up around $57.40/barrel in early trading. Bonds (except for high-yield “junk”) are selling off. The 10-year Treasury yield jumped back to 1.58% as the price fell. And by the way, over the last couple of trading sessions the yield curve turned positive.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

ABOUT FACE!

Stocks opened higher this morning, rebounding from yesterday’s Tweet-induced sell-off. The Dow is currently up 211 pts and the SPX is up .9%. Cyclical sectors like energy, financials, industrials and tech about-faced and are up more than 1% in early trading. The VIX Index, a common measure of fear among traders, fell back to 18.2. Just like that, traders flipped the switch and sentiment is largely risk-on today. Commodities are trading higher; WTI crude oil rebounded to $56.15/barrel and copper is up over 2%. Bonds are roughly unchanged today. Longer-term safe-haven Treasuries are selling off a bit. The 10-year Treasury Note yield ticked up to 1.47%. Junk bonds are up modestly.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

MARKET WEAKER ON TRUMP TWEETS AND ISM DETERIORATION

Stocks sank at the open this morning after the latest round of trade tariffs were imposed on $300bil of goods imported form China. On top of that, President Trump Tweeted that if he is reelected, hammering out a trade deal with China “would get MUCH TOUGHER.” The Dow is currently down 325 pts and the SPX is down .7%. Sectors down more than 1% in early trading include industrials, tech, financials and energy. European stock markets are poised to close down about .4% and Asian markets were mixed overnight. Commodities are mostly lower as well (except for gold +1.2%). WTI crude oil is back down around $53.25/barrel, a three-week low.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

Market Update: August 27, 2019

Stocks opened slightly higher today (Dow 74 pts; SPX 0.1%) as uncertainty remains over the US-China trade war.  Utilities and real estate, both defensive sectors are leading the market higher in early trading.  Financials, energy, and Industrials sectors are in the red this morning. The SPX (S&P 500) is still about 4.5% lower than its late July all-time peak.  The VIX (Fear) Index is still close to its historical average, at about 20.  This is down from 25 in early August.  Gold is up about 13 this morning, signaling some fear remaining from the late July and early August volatility.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

Market Update: August 26, 2019

Stocks opened higher this morning (Dow +271 pts; SPX +.84%) on talks of restarting China and US trade dialogue. Interest sensitive and globally affected sectors — materials, real estate, and energy — are dragging. On the other hand, communications, staples, and tech are up in early trading. The VIX Index is holding its ground at 19.9.  European markets closed mixed, whereas Asian markets were all lower.  Oil is flat; WTI crude is trading at about $53.90/barrel. The dollar is currently stronger at the moment.  Bonds are trading flat to higher, as yields rise slightly.  Junk bonds are up about .38% after some better than expected reports on the economy, mainly in manufacturing data.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

TRADE WAR MOVES TO DEFCON 4

Stocks gapped down at the open this morning. The Dow is currently down 350 pts and the SPX is down 1.5%. Nearly every sector of the market is down more than 1%, led by energy and tech (-2%). Domestically oriented stocks like healthcare insurance, real estate and utilities are holding steady. But companies exposed to the trade war are getting hit. A lot of this is headline driven (see below). The VIX Index spiked to 17.5. Commodities are falling in value, save gold (+1.5%). WTI crude oil is down 3% to $53.60/barrel. Bonds are sopping up the negativity and benefiting from it. The 10-year Treasury Note yield fell back to 1.55% and the iShares 20+ Year Treasury Bond ETF (TLT) is up nearly .9% this morning. The often cited “yield curve” difference between the 2-year and 10-year Treasury yields is still barely positive. This is a technical indicator bond traders watch in order to gauge the chances of an economic recession within the next year or two.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

RELIEF RALLY

Stocks jumped at the open (Dow +260 pts; SPX +1.25%) after the Secretary of Commerce said President Trump intends to delay restrictions on US companies doing business with China’s Huawei Technologies. This has been flashpoint between US and Chinese trade negotiators, with the president using it alternatively as a carrot and then a stick. Traders are enjoying the carrot today; maybe we’ll see the stick again tomorrow or next week. UBS’s Rob Sechan says 85% of stock exchange trade volume during this month’s correction has been either ETF or algo-based—in other words, driven by short-term traders. All eleven major market sectors are in the green today. The cyclical sectors like energy, tech and consumer discretionary are leading the charge, up more than 1.3%. Interest rates jumped, allowing the banks to rally as well. WTI crude oil bounced back to $55.50/barrel, and gold is down .8%. Bonds sold off on higher yields. The 10-year Treasury yield climbed back to 1.60%. Junk bond are the exception, up .25%, as they typically trade along with stocks.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

TRADE WAR IS TAKING A TOLL

Stocks opened modestly higher this morning (Dow +38 pts; SPX +.16%). Defensive sectors—utilities, consumer staples, real estate—are leading way. On the other hand, energy, industrials and tech are flat to down in early trading. The VIX Index is holding its ground at 21.8 and VIX September futures are trading at 20.4. So despite incredibly bearish financial news media coverage, trading aren’t panicking. European markets will close slightly lower, whereas Asian markets were mostly higher overnight. Oil is down in price again; WTI crude is down 1% to trade around $54.60/barrel. The dollar is stronger after hints by an official at the European Central Bank (ECB) that a bigger monetary stimulus package is coming. Bonds are trading uniformly higher today as yields continue to drop. Junk bonds are up about .25% after some better than expected reports on the economy. But Treasuries are also catching a bid. The 10-year Treasury Note yield has fallen to just 1.55%, the lowest since September 2016.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

THE BOND MARKET IS DRIVING THE BUS

Stocks opened sharply lower today (Dow -590 pts; SPX -2.1%). Financials and energy are leading the market lower, down by over 3% in early trading. The only sector in the green is utilities, up .4%. The SPX is still about 1.5% higher than it fell on Monday August 5th, so this is not even the worst day for stocks this month. Machine trading has taken over in reaction to falling yields in the bond market, and also lower trade volume. The VIX Index climbed back to 21, but that’s pretty tame compared with the spike above 35 we saw last December. As opposed to yesterday, everyone wants to be first to call the next recession. Scanning Bloomberg headlines, we see the following:

“Bond Panic Pummels Banks with Global Recession Fears…”

“Countdown to Catastrophe? The Yield Curve and Stock Bull Markets”

“Recession Worries Pile Up for the Battered Global Economy”


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

HONG KONG JITTERS

The major US stock market averages dived in early trading on continued social unrest in Hong Kong. The Dow is currently down 239 pts and the SPX is down .7%. Ten of eleven market sectors are in the red; financials & energy are the worst performing. As is typical in August, exchange trade volume is pretty low. European markets are poised to close slightly lower today. Strangely enough, most of Asia closed higher last night. Despite intensified pro-democracy protests, Hong Kong’s Hang Seng stock index fell only .4% during the session. The US dollar continued to strengthen vs. China’s yuan and that’s putting some pressure on commodities (i.e. iron ore, copper, agricultural goods). WTI crude oil is unchanged around $54.50/barrel. Bonds are once again powering ahead as yields edge lower. The iShares 20+ Year Treasury Bond ETF (TLT) is up 1.5% today (and 17% on the year). High-grade corporates are up about .4%. On the other hand, Junk bonds are down .3%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

VOLATILITY IS HERE TO STAY IN AUGUST

Stocks opened lower this morning, taking a breather after two days of gains. The Dow is down 218 pts and the SPX is down 1%. Technology (-1.7%) and energy (-1.3%) are the worst performing sectors. Only utilities are holding flat. The VIX Index climbed back to 18.5 this morning. European stock markets (and those in China) closed down by about 1%. Commodities are mostly lower on the day, save oil. Oddly enough, WTI crude oil spiked more than 3% to trade at $54.40/barrel even after an IEA report showed global oil demand at a decade low. It’s no secret that slower global economic growth is bringing down the rate of demand growth; at the same time, US producers continue to pump oil near record levels. It just goes to show that speculation and manipulation are rampant with commodities, and day-to-day prices moves often don’t make sense. Safe-haven Treasury bonds are gaining in price today, pushing yields lower. On the other hand, corporate bonds are falling in price.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

CHINA'S CENTRAL BANK STABILIZES GLOBAL STOCK MARKETS

Stocks opened sharply higher this morning (Dow +197 pts; SPX +1.4%). All eleven major market sectors are in the green, led by tech (+1.9%), materials & consumer discretionary (+1.7%), and communications services (+1.5%). In fact, the SPX has now recovered 50% of its recent decline. The VIX Index collapsed back to 17.6 as jittery traders breath a sigh of relief. Near-term, it looks like Monday’s SPX correction low was successfully re-tested yesterday. But make no mistake, we’re not out of the woods when it comes to volatility. Remember, President Trump’s new round of trade tariffs is scheduled to take effect at the beginning of September. For the moment, however, everything looks rosy. European markets closed up by more than 1%, and Asian markets are also up overnight. Commodities are rebounding today, paced by a sharp recovery in oil prices. WTI crude is up 3% to trade around $52.60/barrel. The bond market about-faced as well. Junk bonds, which sold off by 2% early this month, are now recovering. Treasuries and high-grade corporates, however, are selling off after a monster run. The 10-year Treasury Note yield, which collapsed from 2% to 1.71% in a matter of a few days, ticked up to 1.75%.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.

ANOTHER TRUMP SLUMP

The major stock market averages gapped down at the open, but quickly pared losses. The Dow is currently down 350 pts and the SPX is down 1%. Energy & financial sectors continue to slide, down 2% or more in early trading. In fact, the S&P energy sector has fallen nearly 11% since mid-July, right along with oil prices. It seems oil is somewhat over-supplied at the moment. The VIX Index, which spiked to 24.5 on Monday, has settled down toward 21. The index measures fear among traders, and hasn’t been this high since January. Commodities are mostly lower in today’s session, save copper and gold. In fact, gold is now up over 6% this month. Bonds are, in the words of Jim Cramer, trading like a recession is around the corner. The iShares 20+ Year Treasury Bond ETF (TLT) is up over 7% this month. Interest rates for Treasuries, municipals, and high-grade corporates are falling. The 10-year Treasury Note yield is down around 1.64%, the lowest since early October 2016.


*The foregoing content reflects the author's personal opinions which may not coincide with the opinions of the firm, and are subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk. Asset allocation and diversification does not ensure a profit or protect against a loss. Finally, please understand that–as with other social media–if you leave a comment, it will be made public.