Friday, Jobs Report, normal weekend, and tariffs, tariffs, tariffs. Endless speculation as to whether it is bluster and bluff or a real threat. Kudlow says today they are not a bluff, that the Chinese response was inadequate, but no one wants a trade war. Mnuchin echoed those comments.
Powell did not help markets stating that economic growth was good enough to support rate hikes though how many hikes remains a point of contention and of course, much speculation.
The end result is a lower open, a rally off those lows, a bottoming process midmorning to early afternoon . . . then a drop. Powell not promising a rose garden and Kudlow saying increased tariffs were not a bluff were too much to hold up.
That leaves the indices back down at the same levels again, i.e. SP500, DJ30 at the FEB lows, 200 day MA. NASDAQ back to the TL from early 2016, SOX back to the early week lows, RUTX/SP400 testing at the 200 day MA. No movement, still in the 'process' of trying to bottom.
Leadership showing good pullbacks, not breaking, testing moves from earlier in the week, and will see if they break higher again next week.
SP500 53.93, -2.04%
NADSAQ -151.72, -2.12%
DJ30 -547.48, -2.24%
SP400 -1.85%
RUTX -1.92%
SOX -2.84%
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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