Indices Still In the Green As They Recoup Losses From December


The two major index indicators of the U.S. markets are now showing more positive growth today and yesterday, as well as last week – the S&P 500 and the Dow Jones industrial average are now both a month in the green – and it’s not even St. Patrick’s Day yet!

Let’s hope that green continues into March, as we still have a month and a half until the leprechauns break out their top hats and the traders dance around vats of chocolate gold coins.

For some, it’s a delicate bridge – threats like the U.S. government shutdown that depressed the main Street economy and fears over US/China trade relations have both been big shadows in the traders rearview mirror. And let’s not forget that experts like Alan Greenspan have called market corrections likely…

Then there’s the State of the Union address planned for tonight that might include any amount of crazy twists and turns, some of which may affect markets.

“The speech could impact a host of sectors, as it’s been speculated that Trump may reference drug pricing reform, infrastructure spending and U.S.-China trade policy, as well as provide further details about next steps to achieve his demands for funding for a barrier at the southern border,” writes Emily McCormick today at Yahoo Finance. “Trump has previously suggested there was a “good chance” he would declare a national emergency to build a wall along the U.S.-Mexico border and circumvent Democratic lawmakers, whom have blocked funding for the barrier.”

McCormick also notes that Trump will meet with Fed chief Jerome Powell before the speech – a direct relation to how the Fed moves markets – and points out that the president’s negging of the money boss has rankled many investors.

Let’s give it 24 hours and see what turns up.

For some more positive indicators, we can turn to Zacks.

“Positive development on the trade war front, financial stimulus by the Chinese authorities to stabilize its economy and massive product innovations acted as catalysts for the technology sector’s revival,” Zacks staff reported today.  “Moreover, the technology sector is benefiting from continued strong digital transformation environment … The last few years have witnessed a series of breakthroughs in cloud computing, predictive analysis, artificial intelligence (AI), self-driving vehicles, digital personal assistants, and Internet-of-Things (IoT), which have set the stage for robust growth.”

Zacks also references positive US/China developments:

“On Jan 31, CNBC reported citing sources that officials of the two countries are trying to organize meeting between President Trump and his Chinese counterpart Xi Jinping in late February. This will be the second meeting between the two leaders in less than three months.

President Donald Trump told reporters that he is hopeful of forging a deal with China before the March deadline. Notably, the two countries are currently observing a trade truce which will come to end on Mar 1.

Notably, ongoing trade-related concerns between the United States and China are the biggest reasons for an impending global economic slowdown in 2019. If the tariff conflict between the two largest trading countries can be resolved, it will bolster global economic growth.”