- May 30, 2018
- Market Commentaries
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Market Commentary, 05/30/18
Both the Dow and S&P finished last week slightly higher, 0.2% and 0.3% respectively. These gains came despite rising geopolitical tensions in North Korea and Italy. The Dow climbed 298 points last Monday, to the highest level in two months in response to a potential suspension on tariffs. However, the market reversed later in the week as talk of tariffs returned causing tensions to rise.
Yesterday the Dow fell sharply, closing down 391 points (1.6%), in response to fresh political drama in Italy after a three day weekend. Tuesday marked the largest sell-off in Italian bonds since 1989. Investors are concerned that new Italian elections could create turmoil in the European Union. The worst case scenario would be that the third largest economy in the bloc could vote to leave the Euro. In addition to these concerns, President Trump announced that the US would impose 25% tariffs on $50 billion worth of goods from China, again raising concerns of a trade war with China. (Source: CNN)
The Dow jumped today, closing up 306 points, as concerns ebbed in Italy. Specifically, President Mattarella searches for a solution to the political crisis included those to stave off a new election. The concern on trade with China still lingers, but some analysts feel the strong economy and earnings growth should support the market despite this tension. (Source: WSJ)
Regards,
Jeremiah Patterson, CFP®
Copelin Financial Advisors
514 Brooks Street
Sugar Land, TX 77478
Phone: 281 240-2902
Fax: 281 240-2856
jeremiah@copelinfinancial.com
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