Markets are having trouble with something – and it’s probably either new Federal Reserve interest rate hikes, fears over an impending government shutdown, or the departure of James Mattis from the White House.
Traders uneasy about prospects for major indices like the S&P 500 or the Dow Jones have a menu of options to choose from in assigning blame. We’ve seen these markers move steadily into the red over the week, and now it’s Friday, and the single most respected voice on American foreign policy has just tendered his resignation.
In on the political side, you can see people talking about the wheels coming off of the administration – on the market side, we can already kind of see that a rebound today is unlikely.
This morning, the New York Times is reporting that even though the Senate pushed through a continuing resolution, hours away from a partial government shutdown, the hopes of avoiding this unpleasant outcome seem faint.
Apparently, the House tacked on even more billions of dollars in border wall funding and sent the bill back to the Senate. Senators have already given us clear indications they will not accept such a deal, and though they stand to reconvene today at noon, there doesn’t seem to be enough time to figure this out.
In addition, the president reportedly said he would not sign the Senate deal.
Now, some analysts are talking about the “rally” that indexes are havign today – that intraday green ink – but others see this as just noise in the signal. We have to see if there will be a significant rally today, and a return to higher levels, not just an inching up.
As of press time, although the S&P 500 clawed its way up slightly from 2470 to 2485, it still has a long way to go to dig itself back to the highs of last week. DJIA is similarly inching back up, but switch that daily chart to a weekly chart, and that Christmas Green goes a bright shade of Christmas Red. As for the NASDAQ, it’s not even up today. Meanwhile, Bitcoin is struggling around $4000, and Bitcoin Cash is down today.
The moral of this week’s market movements seems to be that if the “powers that be” can’t provide clarity, markets shake. Time and time again, we’ve heard that markets do not like uncertainty. If they’re going to react to one of their pet peeves today, they’re likely to do so in spades.
