US Stocks Sold Off Monday to De-risk Global Growth Concerns

US Stocks Sold Off Monday to De-risk Global Growth Concerns

$DIA, $SPY, $QQQ, $RUTX, $VXX

US stocks sold off Monday, as trade tensions escalated after China retaliated with a tariff rate hike on US imports. The 2.4% drop in the S&P 500 in a broad-based effort to de-risk amid global growth concerns. 

  • Stocks sold off as US-China trade tensions escalated, China increased its tariff rate on $60-B of US imports
  • Trade angst contributed to global growth concerns, evident from the under-performance in the S&P 500 cyclical sectors
  • Relative strength in the S&P 500 Utilities and RE sectors on a fall in US Treasury yields
  • CBOE Volatility Index (VIX) spiked above 20.0, reflecting increased hedging interest against further Southside
  • S&P 500 fell back below its 50-Day MA (2863) to 2811.87

On Twitter: President Trump warned President Xi that China “will be hurt very badly” if it doesn’t agree to a trade deal. Trump tweeted that Beijing “had a great deal, almost completed, & you backed out!”

President Trump told reporters Monday that a new program to relieve US farmers’ pain is “being devised right now” and predicted that they will be “very happy.” The administration last year handed farmers aid worth $11 billion to offset losses from trade conflicts.

The White House and US Trade Representative’s office did not immediately respond to requests for comment.

Monday, the major US stock market indexes finished at: DJIA-617.38 at 25324.99, NAS Comp -269.92 at 7647.00, S&P 500 -69.53 at 2811.87

Volume: Trade on the NYSE came in at 931-M/shares exchanged

  • NAS Comp +15.3% YTD
  • Russell 2000 +12.9% YTD
  • S&P 500 +12.2% YTD
  • DJIA +8.6% YTD

HeffX-LTN’s overall technical outlook for the major US stock indexes is Neutral to Bullish in here.

Stay tuned…

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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