Stocks teetered near the flat line with a tilt lower on Wednesday, as investors shrugged off the latest scandal related to President Trump, instead focusing on strong earnings, in particular from Target (TGT) whose shares rose more than 3% on strong sales and foot traffic. 2/3rd of the DOW stocks ended in negative territory as market breadth continued to be overwhelmingly negative. Technology stocks led markets higher again, as Microsoft (MSFT) gained more than 1%. The U.S. dollar resumed its bull run, while oil prices were slightly lower and U.S. Treasury prices remained unchanged.
Late Wednesday evening China announced it would retaliate in kind against the United States, whose new tariffs on $16 billion of Chinese goods take effect today. This time China is targeting steel products, automobiles and medical equipment, instead of agricultural products as they did in the last two rounds. Simultaneously, trade delegations from the U.S. and China are kicking off new negotiations in Washington D.C. today, although few expect any breakthroughs or material advances ahead of the scheduled December meeting between Trump and Xi Jinping.
European and Asian bourse are slightly higher in overnight trading, while U.S. equity futures are flat ahead of the three day economic summit in Jackson Hole Wyoming. Monetary policy and trade will be front and center at the summit as several key transportation companies, including naval shipping and trucking are reporting pricing pressures as a result of the escalating trade disputes.
The GGFS Investment Committee
Disclosures: This market commentary is written by GGFS Investment Committee and represents the views of Gary Goldberg Financial Services. This commentary is not investment advice and should not be used as a basis to make investment decisions. Please consult with your registered investment advisor before making any investment decisions.