Get Ready For The Next Trump Bump

Dear Rundown Reader,

Like him or not, when President Trump speaks, tweets, or acts, the markets react.

Sometimes this reaction is good for folks. Sometimes it’s not.

When Trump ratcheted up talks of trade wars with China, markets went into a tizzy.

But now the sweeping tariffs proposed by both the U.S., and China in retaliation, are on hold.

And the markets across the board started today in the green.

Will this new Trump bump last?

Today we break it all down and explain what’s in store for the markets and you.

Your Rundown for Monday, May 21, 2018…

Trade War Fears Put On Ice

Ring the bells.

The trade war with China is on hold.

For how long?

That’s anyone’s guess at this point.

But as expected, with trade war fears on ice, the market outlook for today is good.

Pre-market, Dow Futures were up 224 points, Nasdaq futures up 44.75 points, and the Russell 2000 up 1.34 points.

Additionally over the weekend, the dollar strengthened, Treasury yields climbed, and “European shares advanced,” as reported by Bloomberg.

Never underestimate the effect Trump has on the markets.

Over the weekend Trump put plans to impose $150 billion worth of tariffs on Chinese goods on hold, easing tensions with the Asian superpower.

According to the New York Times, “Steven Mnuchin, the Treasury secretary, said on Sunday that the two countries had made progress as they concluded three days of intense trade negotiations in Washington late last week.”

The BBC notes, “Chinese Vice-Premier Liu He described the deal as a win-win choice.”

And most market pundits this morning are expecting a big day for stocks based on the Trump effect.

After all, when trade war fears were at their height, the markets were in a tizzy.

Logic would dictate we will see the reverse effect now that tensions are easing.

But not everyone is hailing a new day. And some see the bilateral concessions as bad for the U.S.

According to analysts at Credit Suisse, this is just one of many lulls we can expect in a “tit-for-tat” battle that will continue for years.

They may have a point.

Tariffs could come back into the play at any moment if current negotiations on the new trade deal stall again.

U.S. Trade Representative Robert Lighthizer notes, “tariffs remained an important tool to protect our technology,” as reported by the Wall Street Journal.

Folks should rejoice in the Trump bump we should expect to see across the markets.

But don’t over celebrate. Trade war fears could rear their ugly head again at any time.

Until the ink dries on the deal you may still want to stay more defensive with your moves.

Now, turning to the markets this morning…

Market Rundown for Mon., May 21

Yield on the 10-Year Treasury sits at 3.074% this morning, up 0.007.

S&P 500 futures are up 15.00 to 2,728.

Oil’s essentially flat at $71.34.

Gold’s down $7.10 to $1,284.

Bitcoin goes for $8,487 this morning, according to CoinDesk.

We’ll talk again on Tuesday.

For the Rundown,

Aaron Gentzler

Aaron Gentzler

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Aaron Gentzler

Aaron Gentzler is the publisher of Seven Figure Publishing. He is also the editor of The Rundown and has been with Agora Financial / Seven Figure Publishing since 2005. He's been covering technology and markets for over a decade.

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