Stocks Halt on the Verge of Breakout as China Waiting Game Begins

Stocks Halt on the Verge of Breakout as China Waiting Game Begins

Stocks halted on the verge of a breakout last week as investors wait for more news about a potential trade deal with China. The S&P 500 fell 0.5 percent between Friday, September 13, and Friday, September 20. It was the first negative week in the last four and came as the the index paused near its late-July record high. Almost every economic report was positive. Housing starts, existing home sales and homebuilder confidence blitzed ahead of expectations. Jobless claims remained super low. Industrial production beat forecasts, despite widespread talk of factories leading us into recession. The Federal Reserve also cut interest rates for the second time since July. The move was hardly a surprise because almost every other central bank on the planet has done the same. The big news was the Fed’s overall optimism toward the U.S. economy and the sharp division between policymakers. But, that’s almost inevitable with Chinese trade still a huge question. What Will October Bring? President Trump’s trade war against the Asian giant is the market’s top concern now. If a deal is reached to end the uncertainty, investors and business leaders will probably breathe a sigh of relief. Orders and sentiment could surge, and the S&P 500 may have all the fuel it needs to put 3,000 in the rear-view mirror. S&P 500 with 50-day moving average, July peak over 3,000 and potential support level near 2,940. On the other hand, things could play out just the opposite if Beijing and the White […]

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