The Closing Bell: Stocks Tumble As Investors’ Trade Fears Return

Ted

FYI: ( Reminder: U.S. stock markets will be closed Wednesday, Dec. 5, in observance of a national day of mourning for President George H. W. Bush. The U.S. bond market will also be closed for trading on Dec. 5, on the recommendation from the Securities Industry and Financial Markets Association, better known as SIFMA. The CME Group also said it will shutter its U.S.-based equity and interest rate futures and options products.)

The Dow Jones Industrial Average fell more than 799 points Tuesday and bond yields plummeted, as investors’ doubts over the trade truce struck between the U.S. and China renewed anxieties around the pace of economic growth.

Investors broadly retreated from stocks, with industrial stalwarts like Boeing and Caterpillar suffering steep losses. Apple and other technology companies also slid, pulling the Nasdaq Composite back more than 10% below its August high.

Waning enthusiasm for the 90-day tariff cease-fire struck over the weekend fueled the losses, several investors said, stirring worries that ongoing spat between the world’s two biggest economies could unravel economic growth in the U.S. and put additional pressure on Europe and Asia, which are already struggling.

Those growth fears pushed investors into assets that tend to be safer stores of value during periods of economic instability, including U.S. government bonds and shares of utility companies, which typically pay hefty dividends.

The flight from stocks to bonds sent several warning signals of an economic slowdown reverberating through markets.

Rising bond prices pushed gap between yields on the two- and 10-year U.S. Treasury notes to their narrowest difference since 2007, a closely watched measure among investors since such occurrences tend to precede a recession. The gaps between two- and five-year yields and three- and five-year yields have already inverted.

Of the eleven S&P 500 Sectors, only Utilities finished in positive territory.
Regards,
Ted

WSJ:
https://www.wsj.com/articles/global-stocks-waver-as-treasury-yields-decline-1543914431

Bloomberg:
https://www.bloomberg.com/news/articles/2018-12-03/asian-stocks-set-for-muted-open-curve-flattens-markets-wrap?srnd=premium

IBD:
https://www.investors.com/market-trend/stock-market-today/dow-jones-plunges-700-points/

Reuters:
https://www.reuters.com/article/us-usa-stocks/wall-street-drops-on-trade-truce-doubts-bond-market-jitters-idUSKBN1O31JV

CNBC:
https://www.cnbc.com/2018/12/04/stock-market-dow-futures-fall-amid-us-china-trade-deal-skepticism.html

U.K.:
https://www.marketwatch.com/story/uk-stocks-fall-as-brexit-headlines-drive-up-sterling-2018-12-04/print

Europe:
https://www.marketwatch.com/story/european-markets-down-as-trade-truce-between-us-and-china-questioned-2018-12-04/print

Asia:
https://www.marketwatch.com/story/asian-markets-take-a-break-a-day-after-big-gains-2018-12-03/print

Bonds:
https://www.cnbc.com/2018/12/04/bond-market-treasury-yields-continue-slide-with-traders-wary-of-fed.html

Currencies:
https://www.cnbc.com/2018/12/04/forex-markets-dollar-the-fed-in-focus.html

Oil:
https://www.cnbc.com/2018/12/04/oil-markets-opec-meeting-in-focus.html

Gold
https://www.cnbc.com/2018/12/04/gold-markets-dollar-us-china-trade-in-focus.html

WSJ: Markets At A Glance:
https://markets.wsj.com/us

Major ETFs % Change:
https://www.barchart.com/etfs-funds/etf-monitor

SPDR's Sector Tracker:
http://www.sectorspdr.com/sectorspdr/tools/sector-tracker

SPDR's Bloomberg Sector Performance Pie Chart:
https://www.bloomberg.com/markets/sectors

Current Futures:
https://finviz.com/futures.ashx

JoJo26

The world is coming to an end. Sell everything.