Just last week, Wall Street was celebrating a new milestone of fresh market highs, but the high quickly came to an end following a weekend tweet. The possibility of a trade war has been on investor’s radar for about a year, but the market has mostly been discounting the risk. The consensus is that the current administration and China have been playing hard ball, but that they would reach an agreement.
That view is quickly changing after the tweet the president sent out last weekend. President Trump put pressure on China to strike a deal by saying he would increase the amount of the tariffs if a deal was not completed by 12:00 a.m. EST on Friday.
The markets have reacted with a sell off. The S&P 500 is down 2.54% this week as of Thursday’s market close, with the rest of the world following in lockstep. The MSCI All World Index excluding the U.S. was down 3.48% this week, while emerging markets led the biggest decline, down 5.02%.
The S&P 500 rapid decline has some market technicians thinking it might test the 200-day moving average.
It is certainly possible that we can get a pull back in the markets, making things bumpy in the near future, but as long-term investors, we must always remember that we cannot allow short-term noise to derail a well thought out financial and investment plan.
The Surevest Investment Committee has been analyzing the data and is well prepared to help our clients navigate through choppy waters. Robert Luna, CEO & Chief Investment Strategist, will be on the Charles Payne show on Fox Business today at 11:00 am PST providing his insights on the U.S. & China tariffs and the recent IPOs. Tune in to listen to Robert’s reaction to the latest market news.