Wall Street falls amid caution on U.S.-China trade dispute

Once again, conflicting trade war rhetoric got in the way of healthy trading with the Dow spending most of the day in the red, only briefly going about 80 points in the black mid-afternoon until it turned south again ending 95 points down.  The trigger today was Beijing reporting a reluctance for an agreement, placated late in the session by Kudlow issuing a statement that progress was expected once the meeting actually gets underway later.  Then Fox reported that a deal was actually imminent, which sent stocks higher in late trading, but that report was later denied by the White House so look for more selling tomorrow.  Very shortly, though, anxieties will switch from trade to Q3, which begins next week, and is expected to fall 3% which, if true, would be the lowest profit performance since 2016.  Volume was on the light side at 5.7 billion. 

Succinct Summation of Week’s Events 10.4.19 (plus AAII Audio Subscription)

It's Sunday night and the usual weekly summation is below.  The positives are that unemployment has reached another historic low and non-farm payrolls rose per expectations thereby alleviating some of the panic from earlier in the week.  Layoffs also fell about 20% to their lowest since April.  The most significant negatives are the decline in factory orders and construction spending rising less than expected.  The bonus this Sunday is a great little deal being offered by AAII that audio recordings of all 50+ talks at the national annual seminar to be held in Florida later this month can be had for just $89, reduced from $139, if they are pre-ordered.  This sounds like a wonderful opportunity to get a lot of great information without the expense of going to Florida.  Hope everyone had a great weekend.

AAII Weekly Digest: Mutual Fund and ETF Critical Questions to Ask

It's time to talk about ETFs again as this week I received this very timely notice from the AAII about their latest guide to mutual funds and ETFs and, in particular, the most important questions to ask when evaluating them.  Have a good read and have a good weekend.  Tomorrow, more good news from the AAII. 

'Goldilocks' jobs data propels Wall St. to best day since August

Generally speaking, if the monthly Labor Department jobs report is at all contrary to a poor payrolls report that is always issued a couple days beforehand, it triggers a considerable rally.  That’s what happened today with the nonfarm payrolls report showing an increase of 136,000 new jobs last month and unemployment at a 50-year low.  The Dow shot up immediately upon open and continued rising all day to close 372 points up.  It’s been called a “Goldilocks” report, not strong enough to prevent a rate cut, not weak enough to create concern, the best of both worlds.  The S&P, which lost 3% earlier this week, is now just about even and, better still, for the last 12 months is up 2% and just 2% off its record high in July.  The real excitement is that there remains a wide expectation of more rate cuts, the odds having changed from 40% on Monday to 77% today.  But volume was light at 5.9 billion shares traded. 

Wall Street gains as weak services data raises rate-cut expectations

Some days we get bad economic data and the market plummets for fear of recession and other days bad reports cause a rally because of hopes of rate cuts.  For a long time now, investors have not been able to decide whether they want a healthy economy or not.  That’s what happened when the Dow plunged some 330 points at 10 a.m. when a report surfaced that services activity was at a 3-year low.  Then the market readjusted its thinking and decided to take this as a sign that the Fed would have to have more rate cuts now – and the Dow soared the rest of the day some 450 points to close 122 up.  But the real tune will be sung on Friday with the jobs report.  Volume was close to average at 7.1 billion. 

Wall Street tumbles as trade war threatens U.S. economy

For the second day in a row the Dow tumbled big time, this session to the tune of 494 points, 150 more down than yesterday, triggered by the private payrolls report showing that businesses have cut down on hiring.  This is just another confirmation of the toll the trade war is taking on U.S. businesses and the economy, showing we are not immune to this trade dispute.  That combined with yesterday’s report showing factory activity at its lowest level in a decade is just stoking investor expectations of a recession.  Now all eyes will be on Friday’s jobs report which, if it shows a different picture, will probably bring the buyers back but, if it agrees, will just spark more selling.  The S&P and Dow have now momentarily slipped below their 100-day moving averages but, to keep perspective, the S&P is still just 5% below its all-time high and has lost only 1% in 12 months.  Volume was large at 8 billion and the VIX rose almost 2 points to just over 20.  Just bear in mind that anything under 30 is still considered optimistic. 

Wall Street tumbles as factory activity hits 10-year low

Today was the first day that a much more concrete report came our way supporting possible recession with the ISM manufacturing data showing factory activity contracting for the first time.  It was significant since it follows in the same trendline as Europe, Japan, the UK and China.  It was more than enough to send the Dow tumbling 343 points, its biggest drawdown since August 23^rd when Trump demanded that U.S. companies stop investing in China.  And though the ISM was a bad number, the good news is that as expressed by today’s expert, “Manufacturing itself is in a recession, but it does not mean that the overall economy is in a recession.”  Indeed, the general consensus seems to be that it is not.  But Friday’s jobs report will shed more light on this and investors eagerly await it.  Other good news is that, despite the yearlong hammering of global growth, confidence in the U.S. economy remains high and has helped bolster the S&P 17% this year.  Other big news is that Schwab has started a brokerage price war by eliminating online transaction fees sending the industry into a panic. E*Trade tumbled 16.4%.  Oddly, Schwab tumbled 9.7 percent.  Volume was right in line with the 4-week average at 7.3 billion.