Do Stocks Face a “Wile E. Coyote” Moment?

Do Stocks Face a “Wile E. Coyote” Moment?
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By • • Stock Market Investing Among the most pleasant memories of my Baby Boomer childhood are the Warner Brothers cartoons that played on television every Saturday morning. Our TV set had rabbit-ear antennae and only three channels. Particularly beloved was Wile E. Coyote. In frantic pursuit of the Road Runner, the hapless predator would run straight off a cliff and continue to pump his legs in midair…until he glanced around, gulped, and plummeted into the canyon. Likewise, the overbought stock market has continued to defy gravity. But maybe not for long. In a research report dated June 10 , analysts at Citigroup (NYSE: C) warned that the Trump administration’s persistent trade disputes could plunge stocks into a “full-scale bear market” before the year is over. That said, the Dow Jones Industrial Average, S&P 500 and tech-heavy Nasdaq have enjoyed a multi-day surge, as the major indices continue to “climb a wall of worry.” Investors are pleased that President Trump abandoned his plans to slap 5% tariffs on Mexico. Meanwhile, the White House appears to be coaxing China to the bargaining table. Trump and Chinese leader Xi Jinping are scheduled to meet at the G-20 Summit on June 28-29, in Osaka, Japan. Hopes are high that the world’s two largest economies will resolve their differences on trade. But those hopes could get dashed. Trump said Monday that if Xi skips the G-20 meeting, the U.S. would impose tariffs on another $300 billion on Chinese goods. Markets would likely tumble […]

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