The Trump Effect: US Trade Deficit Falls on Record Exports, Market Soars

The Trump Effect: US Trade Deficit Falls on Record Exports, Market Soars

The Trump Effect: US Trade Deficit Falls on Record Exports, Market Soars


The US trade deficit fell to a 7-month low in April as exports rose to a record high, lifted by an increase in shipments of industrial materials and soybeans.

The US Commerce Department said on Wednesday the trade gap dropped 2.1% to $46.2-B, the smallest since September.

Data for March was revised to show the trade deficit falling to $47.2-B, instead of the previously reported $49.0-B.

Economists polled by Reuters forecasted the trade deficit unchanged at $49-B in April.

If the trend in the real trade deficit is maintained, trade could contribute to GDP (gross domestic product) in Q-2 after having a Neutral impact in Q-1 of Y 2018.

Strong data ranging from manufacturing to consumer spending and the labor market have led the Federal Reserve Bank of Atlanta to estimate that economic growth in the Q-2 will Top a 4.8% annualized rate.

The US economy grew at a 2.2% pace in Q-2.

Economists say that tariffs will do little to shrink the trade deficit, partly because of the dollar’s status as the global reserve currency and the low US savings rate, including a fiscal deficit that has been blown up by a $1.5-T tax cut package.

Economists are often wrong.

10 of 11 S&P 500 sectors advanced Wednesday.

The financial space (+1.8%) was strong throughout the session.

The NAS Comp and Russell 2000 posted record highs again.

Wednesday, the major US stock market indexes came in at: DJIA +346.41 at 25146.39, NAS Comp +51.38 at 7689.24, S&P 500+23.55 at 2772.35 

Volume: Trade on the NYSE came in at 958-M/shares exchanged

  • NAS Comp +11.4% YTD
  • Russell 2000 +9.2% YTD
  • S&P 500 +3.7% YTD
  • DJIA +1.7% YTD

HeffX-LTN’s US Major Stock Market Indexes Technical Analysis

Date Symbol Price Technical Analysis Support Resistance
6 Jun 2018 QQQ 175.07 Bullish (0.38) 153.45  None
6 Jun 2018 DIA 251.46 Bullish (0.36) 250.41 254.10
6 Jun 2018 SPY 277.23 Bullish (0.32) 274.10 278.11

Stay tuned…


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