Renewed Trade Tensions Trip Investors

Renewed Trade Tensions Trip Investors
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By • • Stock Market Investing I was watching a DVD of Peanuts with my toddler grandsons last weekend when we got to the famous bit about Lucy repeatedly snatching the football away from Charlie Brown. She promises to hold it steady on the ground, he runs to kick the ball, she snatches it away at the last moment, he trips and wipes out. The pattern repeats. I think of that scene, whenever Washington and Beijing dash the unrealistic hopes of investors for a trade deal. Wall Street yesterday was riding high on promises of trade progress but stocks fell to earth when trade peace was suddenly snatched away. It’s been a recurring pattern all year. Sometimes the investment herd behaves in such a cartoonish manner, you can only shake your head. The Sino-American trade war is a prime example. The fluctuating fortunes of trade negotiations are whipsawing investors. The three main stock indices closed deeply in the red Tuesday, after optimism over a trade deal was shot down. The Dow Jones Industrial Average fell 313.98 points (-1.19%), the S&P 500 fell 45.73 (-1.56%), and the tech-heavy Nasdaq shed 132.52 (1.67%). The CBOE Volatility Index (VIX), aka “fear gauge,” jumped 13%. As of this writing on Wednesday morning, the three indices were trading in the green, on cautious optimism ahead of a planned speech today by Federal Reserve Chair Jerome Powell. If Powell signals that another interest rate cut isn’t off the table, stocks could surge. But the biggest […]

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