No Deal!

China doesn’t want to make a deal.

Futures slipped Sunday night as we learned the Chinese aren’t exactly eager to sign on Trump’s dotted line when it comes to a new trade deal.

“Chinese officials are signaling they’re increasingly reluctant to agree to a broad trade deal pursued by President Donald Trump, ahead of negotiations this week that have raised hopes of a potential truce,” Bloomberg reports. “In meetings with U.S. visitors to Beijing in recent weeks, senior Chinese officials have indicated the range of topics they’re willing to discuss has narrowed considerably, according to people familiar with the discussions.”

Perhaps China is more willing to bide its time as the impeachment screws tighten. After all, why should China rush to appease an embattled Trump as an election year approaches?

Futures remain modestly lower this morning as European and Asian shares retreat. Hopefully, earnings season will provide an adequate distraction for stocks this week if we can’t squeeze productive headlines out of the trade war.

While trade wars continue to worry the herd, a positive reaction to Friday’s jobs report saved the stock market from an otherwise rough trading week.

Low unemployment makes investors happy.

After a discouraging week, the U.S. added 136,000 jobs last month, sending unemployment to a 50-year low. More importantly, this headline number helped cancel out some soft data that hit the market earlier in the week.

The upbeat jobs news is exactly what this ailing market needed to claw back some of its losses. Stocks tumbled early last week following a double-whammy of bad data. The ISM factory index dropped to its lowest level since 2009 and private payrolls slumped, pushing the S&P and Dow to their first back-to-back 1% losses of the year.

But a strong push into the weekend helped mask most of the damage. The Dow finished the week down less than 1%, while the Nasdaq even managed to sneak into positive territory.

Dig beyond record unemployment, however, and you’ll quickly see the numbers aren’t so perfect. A major concern bubbling up under the surface is yet another decline in factory jobs.

“It’s just the latest crack in the industry, which slipped into a recession this year,” Bloomberg notes. “One major gauge showed manufacturing contracted for the second straight month to the lowest level since 2016, with employment being one of the laggards. Capital equipment orders — a proxy for investment — rose at the weakest pace in four months in August, the most recent data show, indicating goods-producers taking a step back.”

off the factory floor

While record-low unemployment lifts the market, one of the year’s most disappointing industries is starting to show signs of life.

“It’s no secret that we’ve been in an incredibly tough market for cannabis stocks in 2019,” our own Ray Blanco says. “But all sell-offs eventually come to an end. And when they do, the subsequent uptrend often ignites on a day that looks a lot like one pot stocks experienced last week.”

As the major averages plunged on Wednesday, pot stocks finally caught a bid. While they started the session down alongside the rest of the stock market, cannabis stocks came alive around midday, pushing higher across the board.

“While the ETFMG Alternative Harvest ETF (NYSE:MJ) was down as much as 4.4% during yesterday’s session, it ultimately managed to end the day higher,” Ray noted after the dust cleared. “And many of the names in our portfolio actually ended Wednesday’s session much higher.”

Pot stocks followed up their impressive rally with another move higher on Thursday before consolidating some of these gains heading into the weekend.

Are these the first glimmers of a long-awaited rebound rally in cannabis? To get the inside scoop. click here to see how Ray can help get you get started on your own path toward pot stock profits.

One last thing before I sign off…

I’ve been writing the Rude for nearly eight years now, covering the ups and downs of stocks, commodities, and all the crazy market-moving news that’s fit to print.

Now, I’m excited to share with you some big news.

I’m pairing with Kenny Polcari, a veteran member of the New York Stock Exchange, to deliver you even more hard-hitting market analysis.

Kenny is a CNBC exclusive contributor appearing on shows like Fast Money, Halftime Report, Power Lunch, and Closing Bell — and his market commentary has reached audiences across the nation on media outlets like Bloomberg, Fox, ABC and more.

Tomorrow I’ll give you more info on what this means for your Rude subscription…

But for now, sit tight and be sure to read tomorrow’s update on the upcoming changes.

Sincerely,

Greg Guenthner

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Greg Guenthner

Greg Guenthner, CMT, is the editor of Opening Bell Fortunes and Seven Figure Signals. He has been with Agora Financial/Seven Figure Publishing since 2005. In 2019, the average position in Greg’s Sunrise Fortunes portfolio outperformed the S&P 500 by 1.65x.

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