Week of June 8 2018 Weekly Recap & The Week Ahead

June 11th, 2018

“The secret to being successful from a trading perspective is to have an indefatigable and an undying and unquenchable thirst for information and knowledge.” – Paul Tudor Jones

1. China Launches Foreign Chipmaker Probe — Chinese regulators are investigating Micron Technology (NASDAQ:MU), Samsung Electronics (OTC:SSNLF) and SK Hynix (OTC:HXSCL) as the country tries to reduce dependency on foreign chips, WSJ reported. Some speculate the probe concerns the rising cost of DRAM chips – the three companies are dominant suppliers – or it might be seeking to use the current DRAM pricing environment to gain leverage for a technology transfer. Also, ZTE has signed an agreement in principle that would lift a U.S. Commerce Department ban on buying from American suppliers, sources told Reuters. The preliminary deal includes a $1B fine, plus $361 from an earlier settlement and $400M in escrow to cover any future violations
2. Primaries Shape Battle for Congress In Mid-Term Election — the battle for control of Congress is on the radar as voters across eight states choose nominees in a slew of hotly contested primaries. The California races have garnered the most attention because of that state’s open primary system, in which the top two vote-getters advance regardless of party affiliation. An oversupply of Democratic candidates could result in a splintered electorate, allowing two Republicans to advance to November’s midterm election.
3. U.S.-China Trade Developments Progress — China has offered to purchase nearly $70B of U.S. farm, manufacturing and energy products if the Trump administration abandons its threat for $50B in duties on China-made products. The White House, which is looking to reduce its trade deficit with China by $200B, has said it plans to move ahead with the tariffs shortly after June 15 as a way to pressure Beijing to make more sweeping changes in its economy.
4. EU Prepares tariffs against U.S. in July — the EU “expects to conclude the relevant procedure in coordination with member states before the end of June,” European Commission Vice-President Maros Sefcovic told a news briefing. From blue jeans to motorbikes and whiskey, the hit list of U.S. products targeted for tariffs reads like a catalog of emblematic American exports.
5. The Pentagon’s Hypersonic Weapons Project – Hypersonic weapons are among the technologies emphasized in the Senate’s newly released $716B defense authorization bill for FY 2019. But as Russia and China continue their march toward fielding hypersonics, the Pentagon and its largest weapons supplier have shared limited details about their own efforts. Lockheed (NYSE:LMT) will be responsible for designing, engineering, integration and logistical support on the $928M U.S. hypersonic project.

The week ahead — Economic data from

Week of June 1 2018 Weekly Recap & The Week Ahead

June 4th, 2018

“The financial markets generally are unpredictable. So that one has to have different scenarios… The idea that you can actually predict what’s going to happen contradicts my way of looking at the market.” – George Soros

1. Euro, Yield Worries Amid Turmoil in Italy – Italy’s anti-establishment parties have abandoned plans to form a coalition government after the country’s president refused to accept a controversial choice for economy minister, raising the possibility of snap polls. Investors fear the election will resemble a referendum on the EU and the euro, posing an existential threat for the bloc. That sparked the currency to slip below the $1.16 level, while the gap between Italian and German 10-year bond yields widened to its highest in over four years, putting pressure on banks and stocks across the region.
2. U.S. Moves Forward with China Tariffs — the White House is proceeding with its proposal to impose 25% tariffs on $50B worth of goods from China, and place new limits on Chinese investments in U.S. high-tech industries. “This statement is obviously in violation of the consensus reached in Washington recently by both China and the U.S,” China’s Commerce Ministry declared, pointing to the “trade war hold” announced by Treasury Secretary Steven Mnuchin less than 10 days ago.
3. US Allies Strike Back Against U.S. Tariffs — besides retaliatory tariffs from the European Union, the U.S. is facing “counter-balancing measures” from its northern (Canada) and southern neighbors (Mexico) after imposing duties on steel and aluminum. Canada’s levies will cover C$16.6B in imports, including whiskey, orange juice and other food products, alongside metal tariffs. Mexico’s reciprocal measures will also target steel, as well as pork legs, apples, grapes and cheeses.
4. China A-shares Join MSCI Indexes — more than 230 Chinese stocks, known as A-shares, have been finally added to MSCI’s Emerging Markets Index (ETF: EEM), giving ordinary U.S. investors greater access to mainland China. The move is expected to drive a surge of foreign money into local markets.

The week ahead — Economic data from

Week of May 25 2018 Weekly Recap & The Week Ahead

May 29th, 2018

“Every trader has strengths and weakness. Some are good holders of winners, but may hold their losers a little too long. Others may cut their winners a little short, but are quick to take their losses. As long as you stick to your own style, you get the good and bad in your own approach.” — Michael Marcus

1. Venezuela’s Maduro Wins Re-Election — Venezuela’s Nicolas Maduro won a new six-year term in an election deemed illegitimate by the opposition and foreign governments, paving the way for heavier international sanctions. The economy has been in recession since 2014, with the bolivar currency down 99% in the past year and inflation at an annual 14,000%, according to the National Assembly.
2. Argentina Starts IMF Bailout Negotiations – with Argentina on the brink of a financial crisis, the IMF has formally begun bailout negotiations, without any objection from the Trump administration. Such measures rarely advance without U.S. support. The peso has fallen drastically against the dollar, while the nation has been dogged by persistent budget deficits, high inflation and trade imbalances.
3. China to Cut Import Duties On Cars — the easing of trade tensions between the U.S. and China is continuing, with the latter pledging to cut import tariffs on passenger vehicles to 15%, down from 25%. Import duties on car parts will be reduced to 6%. It comes after Washington froze its proposed Chinese tariffs and looked into lifting the ban on ZTE, while Beijing halted its probe into U.S. sorghum imports and restarted the review of the Qualcomm-NXP deal.
4. U.S. Launches Criminal Probe Into Crypto Manipulation — Bloomberg reports the DOJ is in the early stages of a criminal probe into whether traders are manipulating the price of bitcoin and other cryptocurrencies. It comes amid skepticism that exchanges are actively pursuing cheaters, wild price swings and a lack of regulations. Federal prosecutors are working with the CFTC, a financial regulator that oversees derivatives tied to bitcoin.
5. Trump Cancels Singapore Nuclear Summit with North Korean Leader Kim Jong Un — President Donald Trump canceled his historic nuclear summit with Kim Jong Un late last week, accusing North Korea of “tremendous anger and open hostility.” The news came as North Korea made a show of dismantling a nuclear test site, but also on the heels of some sharp words from the North Korean government about America denuclearization demands.
6. Peak Earnings Growth Follows by Recessions Statistics — courtesy of LPL Reseach (see table below), the average time the market proceeds to recession based on the last 12 earnings growth peaks since 1953 is about 4 years. If this hold true, we could expect a recession in mid-2022 which would make the current U.S. economic expansion the longest ever at 13 years old. Also note that the S&P 500 was up an average of 59% during these periods between the earnings growth peak and the start of the next recession.

The week ahead — Economic data from

Week of May 18 2018 Weekly Recap & The Week Ahead

May 21st, 2018

1. N.Korea Expands Threat to Cancel Summit & Plans To Destroy Nuclear Test Site — North Korea is expanding on its threat to cancel the June 12 summit between Kim Jong-un and President Trump. Besides protesting the joint air force drills taking place in South Korea, Pyongyang said the U.S. must stop insisting it “unilaterally” abandon its nuclear program and lashed out at national security advisor John Bolton, who talked about a disarmament similar to “Libya 2004.”. Also, Pyongyang plans to destroy all of the tunnels at the country’s northeastern testing ground with an explosion and remove observation facilities, research posts and ground-based guard units.
2. New Ebola Outbreak Hits Congo — the deadly hemorrhagic disease Ebola has resurfaced again, with the WHO revealing 32 potential cases of the disease (including 18 deaths) in the Democratic Republic of the Congo. Experimental Ebola vaccines are under development, such as leading candidate – Merck’s (NYSE:MRK) rVSV-ZEBOV – but they have not been fully tested for safety or effectiveness.
3. The Supreme Court Ruled New Jersey Can Legalize Sports Gambling — the Supreme Court announced late last week that New Jersey can legalize sports betting in what could be a landmark case in the gaming industry. It clears the way for states, if they choose, to allow gambling on athletic events by striking down the 1992 Professional and Amateur Sports Protection Act, a federal law that said states couldn’t “sponsor, operate, advertise, promote, license, or authorize” sports gambling.
4. More States Sue Over Opioid Epidemic Drug Makers — Litigation against OxyContin maker Purdue Pharma is intensifying as six more U.S. states – Nevada, Texas, Florida, North Carolina, North Dakota and Tennessee – announced lawsuits that accuse the company of fueling a national opioid epidemic. Florida also sued Endo Pharmaceuticals (NASDAQ:ENDP), Allergan (NYSE:AGN), units of Johnson & Johnson (NYSE:JNJ), Teva Pharmaceutical (NYSE:TEVA), and Mallinckrodt (NYSE:MNK), as well as AmerisourceBergen (NYSE:ABC), Cardinal Health (NYSE:CAH) and McKesson (NYSE:MCK).
5. AAII Weekly Sentiment Survey — In this week’s sentiment survey from AAII, bullish sentiment ticked up to 36.68% from last week’s level of 33.51%. The bulls are back above the average of 36.62% for the current bull market.

in bearish sentiment, which declined for the second straight week, falling from 25.5% down to 20.6%. Since its recent high in early April, bearish sentiment has now been more than cut in half. It’s also at the lowest level since the first week of the year.

6. Small cap Russell 2000 Index and S&P 600 Small Cap Index Hit New All-Time Highs — over the past week, both the small cap Russell 2000 Index and S&P 600 Small Cap Index have recorded not only new bull market highs, but also new all-time highs. Historically, small caps have been among the first stocks to show developing weakness as a bull market enters its final stages; However, these new highs in both the small cap price indexes and Advance-Decline Lines suggest an ongoing and healthy primary uptrend showing few signs of age.

The week ahead — Economic data from

Week of May 11 2018 Weekly Recap & The Week Ahead

May 14th, 2018

“If you have an approach that makes money, then money management can make the difference between success and failure… … I try to be conservative in my risk management. I want to make sure I’ll be around to play tomorrow. Risk control is essential.” – Monroe Trout

1. Trump Set to Unveil Drug Price Policy — President Trump’s plan will reportedly require Medicare Part D plans to share a portion of discounts they receive from drug manufacturers with patients, as well as including ways to allow the government to better negotiate. Secretary of Health and Human Services (HHS) Alex Azar stated “We’ll be building on the proposals in the president’s budget, but he wants to go further,” Also, the White House said the HHS will take steps to end the gaming of regulatory and patent processes by drugmakers to unfairly protect monopolies, advance biosimilars and generics, consider whether to include prices in drugmaker ads, and accelerate the approval process for over-the-counter drugs.
2. U.S. Imposes More Sanctions on Venezuela – the U.S. has announced new sanctions on three Venezuelans and 20 companies with ties to President Maduro, whom it blames for a deep recession and hyperinflation that have caused food shortages across Venezuela. Vice President Mike Pence also called for more nations to increase pressure and urged Caracas to suspend a May 20 election he denounced as a “sham.”
3. California Approves Plan to Require Rooftop Solar Power for New Homes – California has become the first U.S. state to require solar panels on nearly all new homes built after Jan. 1, 2020, as part of new energy efficiency standards adopted by the California Energy Commission. While the move is a boost for the solar industry, critics say it will add $8K-$12K to the cost of buying a house in the state. Solar already provides 16% of California’s electricity.
4. President Trump Abandoned a Nuclear Deal with Iran – President Trump abandoned a nuclear deal with Iran and announced the “highest level” of sanctions against the OPEC member. Financial or business activities outlawed by August 6 include exports of airplanes and parts, dollar transactions, trade in gold and other metals, sovereign debt and the auto industry. By November 4, sanctions will ban oil purchases and transactions with the central bank. Furthermore, the U.S. Treasury has imposed penalties on nine Iranian companies and individuals for allegedly operating a currency exchange network that – with the help of Iran’s central bank – transferred millions of dollars to the Iranian Revolutionary Guard’s elite Quds Force.
5. Cumulative Advance/Decline Line Made New All-Time High — the Advance/Decline Line has made a new all-time high with positive expansion in breath. Stocks recording new highs are also suggestive of higher prices even though the stock market is overbought on a near-term basis.

The week ahead — Economic data from

Week of May 4 2018 Weekly Recap & The Week Ahead

May 7th, 2018

“The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer. They will die poor.” – Jesse Livermore

1. U.S. Delays Tariffs on European Union, Canada and Mexico for 30 days — the Trump administration is delaying a decision about whether to impose steel and aluminum tariffs on the EU, Canada and Mexico until June 1, giving key allies a reprieve as the countries carry out further negotiations. The Iran deal is also on watch.
2. CFTC Chair Comments on Crypto Currency Regulation — according to CFTC Chairman J. Christopher Giancarlo, Bitcoin has “elements of all of the different asset classes,” stating that the popular crypto-currency is part currency, part security and part digital coin. “At the end of the day, it’s for Congress, and not regulators, to decide whether new policies should be evolved for these new asset classes… I don’t see it being resolved any time soon.”.
3. U.S. Trade Team Heads to China — A U.S. delegation led by Treasury Secretary Steven Mnuchin is on its way to China to discuss economic matters and the trade deficit. “Very much like North Korea, this should have been fixed years ago,” President Trump wrote in a tweet. Some economists anticipate that a short-term bargain involving the automobile industry and other previously announced moves could be struck. The yuan has weakened against the U.S. dollar for the fourth straight day with the trade talks just getting started.
4. FOMC Meeting Recap — the Federal Reserve held interest rates steady after its two-day policy meeting and said it will monitor inflation. The policy-making committee used the word “symmetric” twice in relation to its inflation target, in a potential cue to bond traders that a small overshoot past the 2% inflation target will be tolerated. The Fed noted that risks to the economic outlook are roughly balanced. “The FOMC statement reinforced market expectation for another 25 basis points rate rise in its June meeting,” said JPMorgan chief market strategist Tai Hui.
5. Iran Won’t Renegotiate Nuclear Deal – President Trump warns that unless European allies rectify the 2015 nuclear deal’s “terrible flaws” by May 12, he will refuse to extend U.S. sanctions relief for the oil-producing Islamic Republic. Foreign Minister Mohammad Javad Zarif stated that “Iran will not renegotiate what was agreed years ago and has been implemented,”.
6. Berkshire Increased Apple Stake in Q1 by Adding an Additional 75M Apple Shares — Berkshire Hathaway bought 75M additional Apple (NASDAQ:AAPL) shares in Q1, with Warren Buffett outlining that the company “earns almost twice as much as the second most profitable company in the U.S.” The new investment brings its total stake in the tech giant to 240.3M shares worth $42.5B.
7. AAII Weekly Sentiment – according to this week’s sentiment survey from AAII, bullish sentiment declined from 36.91% down to 28.4%. While anything sub-30% is considered low, we actually saw a lower weekly print back in the first half of April, when bullish sentiment dropped down to 26.09%.

While bullish sentiment declined over 8 percentage points, bearish sentiment increased by less than 5 points. At the current level of 30.25%, it is nowhere near its recent high of over 40%.

The week ahead — Economic data from

Week of Apr 27 2018 Weekly Recap & The Week Ahead

April 30th, 2018

“The desire for constant action irrespective of underlying conditions is responsible for many losses in Wall Street.” – Jesse Livermore

1. N.Korea Suspends Nuclear, Missile Tests — North Korea has suspended its long-range missile tests and plans to close its nuclear test site ahead of talks between the two Koreas, and the U.S. in May or June. Kim Jong-un said he would make the move as “the weaponization of nuclear weapons has been verified.” It will also create an “optimal international environment” to build his country’s economy. Also, in a historic summit scheduled for April 27th, 2018, North Korean leader Kim Jong-un and South Korean President Moon Jae-in agreed to end a seven-decade war and pursue the “complete denuclearization” of the peninsula. Beyond the geopolitics, many investors are paying attention to the talks. South Korea is critical to the global supply chain and many manufacturers are located close to the border.
2. Amazon Secretly Working on Domestic Robots — according to Bloomberg, Amazon is working on robots for the home and has recently ramped up hiring for the secret project code-named “Vesta.” The effort is being overseen by Gregg Zehr, who runs Amazon’s (NASDAQ:AMZN) Lab126 hardware research. Sources say the robots could be in employee homes by year’s end and with consumers as early as 2019.
3. Treasury Secretary Mnuchin Will Head to China for Trade Talks — Treasury Secretary Steven Mnuchin is headed to China in “a few days” to resolve the ongoing trade dispute between the world’s two largest economies. “They trade with us [but] we can’t trade with them,” President Trump declared. Both countries have proposed tariffs on the other, after the Trump administration’s “Section 301″ investigation into China’s business practices.
4. 10-year Treasury Yields Rises Above 3% — Stocks stumbled last week as the benchmark 10-year Treasury yield hit 3% for the first time in four years, sparking concerns over higher borrowing costs for companies already facing rising commodity prices.
5. EU Closely Watching Aluminum Imports — the European Union has begun monitoring aluminum imports to determine whether U.S. tariffs have led to a surge in shipments into Europe. The EU official journal already found that aluminum product imports increased by 28% between 2013 and 2017, while prices of such imports fell by 5%. Only 16 smelters are still in operation across the bloc, compared with 26 in 2008.
6. S&P500 (SPX) Index Displays Descending Triangle Formation — the chart of the SPX below shows a wedge chart formation, with the SPX bumping up against the downtrend line three times. Typically on the fourth attempt the SPX usually breaks above said downtrend line.

The week ahead — Economic data from

Week of Apr 20 2018 Weekly Recap & The Week Ahead

April 23rd, 2018

“Twenty years from now, you will be more disappointed by the things that you didn’t do than by the ones you did do, so throw off the bowlines, sail away from safe harbor, catch the trade winds in your sails. Explore, Dream, Discover.” – Mark Twain

1. NAFTA Deal Seen Within Weeks — On the sidelines of the Summit of the Americas, Mexican President Enrique Pena Nieto, U.S. Vice President Mike Pence and Canadian Prime Minister Justin Trudeau said they thought a renegotiated NAFTA deal could be reached before Mexican elections on July 1, although they cautioned no deadlines had been set. Pence also revealed that the topic of funding for President Trump’s proposed border wall did not come up at the conference.
2. China Reports GDP Growth of 6.8% in Q1 — China’s economy grew 6.8% in the first quarter of 2018, despite widespread concerns about financial risks amid a government-led economic restructuring. “The U.S.-China trade friction can’t beat the Chinese economy,” added Xing Zhihong, a spokesman at the National Bureau of Statistics, as China slapped a hefty temporary deposit on imports of U.S. sorghum.
3. Investors Wary of Potential for Inverted Yield Curve — the yield curve from five to 30 years continued to flatten last week to as little as 29 basis points, the narrowest spread since 2007, and the gap between the two-year yield and the 10-year yield touched 41 basis points, also the smallest since before the financial crisis. A truly inverted curve “is a powerful signal of recessions” that historically has occurred “when the Fed is in a tightening cycle, and markets lose confidence in the economic outlook,” John Williams, the next president of the New York Fed, said this week, although he maintained that is not the case now. The tightening yield spread is raising concerns among investors and Fed officials, as the phenomenon has sometimes indicated a weakening longer-term outlook for U.S. economic growth and inflation.
4. EpiPen Shortage Plagues Canada – amid a growing shortage that has spared the U.S., Canada is working with the FDA to access supplies of Mylan’s (NASDAQ:MYL) EpiPen. The allergy antidote is made at a single Pfizer (NYSE:PFE) unit near St. Louis, Missouri, but it has been recently hit by manufacturing problems. According to Health Canada, four companies have authorization to sell epinephrine auto-injectors, but none are currently marketing them in the country.
5. U.S. Mulls Emergency Law on Chinese Investment — the U.S. Treasury Department is considering using an emergency law to curb Chinese investments in sensitive technologies as the Trump administration looks to punish China for what it sees as violations of American intellectual property rights. A law may be used known as the International Emergency Economic Powers Act, passed in 1977, which could affect foreign investment in industries like semiconductors and 5G.

The week ahead — Economic data from

Week of Apr 13 2018 Weekly Recap & The Week Ahead

April 16th, 2018

“During major sustained advances in stock prices, which usually occupy from five to seven years of each decade, the investor can complacently hold a list of stocks which are currently unpredictable. He doesn’t worry about the top because he knows he is never going to sell at the top. He knows that the chances are overwhelming in favor of the assumption that he will get far better prices by waiting until after the top is passed and a probable reversal in trend can be identified than he will ever get by attempting to anticipate the top, and get out on the nose. In my own experience the largest profits we have ever taken have come from stocks purchased while they were making a new high in a market which was also momentarily expecting the top.
As I have already pointed out the absolute price of a stock is unimportant. It is the direction of the price movement that counts. It is always probable, but never certain, that the direction of the price movement will continue. Soon after it reverses is time enough to sell. You should sell when you wish you had sold sooner, never when you think the top has arrived. That way you will never get the very best price—by hindsight your individual transactions will never look daring. But some of your profits will be large; and your losses should be quite small. That is all that is necessary for a satisfactory, enriching investment performance.”
— Edgar S. Genstein

1. Nine West Files for Bankruptcy – Nine West Holdings filed for Chapter 11, listing debts of more than $1B. The company will use the bankruptcy to sell the Nine West and Bandolino businesses to Authentic Brands Group, while reorganizing around other brands including Anne Klein.
2. Venezuela Stops Paying Bond Holder — Venezuela stopped paying bondholders in September, according to central bank data, contradicting statements by President Maduro that the country would continue to honor its debts while negotiating a creditor restructuring. The debt crisis could hit another fresh low today as a $650M bond from Electricidad de Caracas matures with little hope it will get paid.
3. Google and AMA Team for Fostering Data Sharing — Google and other big tech companies are looking to partner with established industry players to promote innovation. Google (GOOG, GOOGL) is now teaming up with the American Medical Association, a physician lobbying group, on a plan to get startups to come up with the “best new ideas for fostering data sharing from health monitoring devices.”
4. Airlines Warned on Strikes Over Mediterranean Over Syria — Airlines have been warned to steer clear of the eastern Mediterranean over the weekend due to possible air strikes on Syria. The Trump administration reportedly won the support of France, the U.K. and Saudi Arabia and hit selected sites in Syria late Friday night.
5. AAII Weekly Sentiment — in this this latest weekly bullish sentiment, the bulls dropped from 31.9% down to 26.09%. This marked the fourth straight week of declining bullish sentiment and took the percentage of bulls to the lowest level since last August.

Also, In this week’s survey, bearish sentiment surged from 36.6% up to 42.75%. Bearish sentiment has now increased by more than 20 percentage points in the last four weeks and is at its highest level since last March.

6. GE Explores Hybrid Deals & Spinoffs – General Electric (NYSE:GE) is exploring a public offering for one of its divisions and is discussing hybrid deals with public companies to combine assets in a way that avoids a big tax bill, WSJ reports. Such moves would give GE and its shareholders a chance to participate in the turnaround of struggling businesses rather than risk selling at inopportune times.
7. Russia Weighs Sanctions on the U.S. — Russian lawmakers have drafted legislation in response to new U.S. sanctions. It would ban American food and agricultural products, tech equipment and software, medical products, and tobacco and alcohol. The draft also proposes barring cooperation on atomic energy and aerospace, and stopping U.S. firms from taking part in Russian privatization deals.
The week ahead — Economic data from

Week of Apr 6 2018 Weekly Recap & The Week Ahead

April 9th, 2018

“There is only one side of the market and it is not the bull side or the bear side, but the right side.” ― Jesse Livermore

1. China Hits U.S. with Tariffs on 128 Products – In response to the Trump administration’s recently implemented tariffs on steel and aluminum, China has retaliated with tariffs on imports of 128 American-made products. The tariffs, which are hitting such products as wine and frozen pork, are as high as 25% and go into effect Apr 9. “We hope that the United States will rescind its measures that violate World Trade Organization rules as quickly as possible” said the Chinese Ministry of Commerce in an online statement. Furthermore, The Trump administration has imposed another $50B worth of 25% tariffs on China imports, to which China has responded with 25% tariffs on another 106 American products. The newest U.S. tariffs will impact some 1,300 Chinese products, including medical devices, batteries and machine tools, as well as some consumer products like television sets.
2. GM No Longer Report Monthly U.S. Auto Sales – General Motors stated in its latest report that it will do away with monthly U.S. vehicle sales reports – an industry standard – and switch to quarterly reporting. “Thirty days is not enough time to separate real sales trends from short-term fluctuations in a very dynamic, highly competitive market,” said Kurt McNeil, U.S. vice president, Sales Operations, in a GM press release.
3. First Quarter 2018 ETFs Asset Class Performance — courtesy of BIG, the S&P 500 (SPY), Dow 30 (DIA), and Nasdaq 100 (QQQ) all fell quite significantly in March, which was enough to drag both the S&P 500 and Dow 30 into negative territory for the quarter. Looking at S&P 500 sectors, the worst-performing areas in March were Financials, Materials, and Technology, while Energy and Utilities were actually up nicely. For the full first quarter, though, Technology and Consumer Discretionary were the only two sectors in the black.

4. Cyberattack On Four Gas Pipeline Companies — Bloomberg reported cyberattack that hit the operations of at least four gas pipeline companies in recent days also was felt in the utility industry. Duke Energy (NYSE:DUK) said it first learned of the attack on March 30 because it shares consumer data with third-party electricity and gas providers in Ohio through an electronic system run by Energy Services Group, the data firm that was hacked.
5. Trump Announced New Tariff Threat – President Trump has instructed the U.S. trade representative to look at $100B more in tariffs against China. “In light of China’s unfair retaliation, I have instructed the USTR to consider whether $100B of additional tariffs would be appropriate under section 301 and, if so, to identify the products upon which to impose such tariffs,” Trump said.

The week ahead — Economic data from

June 2018
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