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The Closing Bell: U.S. Stocks Slip Amid Conflicting Signals On Trade Talks

TedTed
edited November 21 in Fund Discussions
FYI: U.S. stocks edged lower Thursday as investors assessed conflicting signals on prospects for the U.S.-China trade talks.

The Dow Jones Industrial Average dropped 0.20%, a day after the gauge of blue-chip stocks logged its biggest fall of the month. The S&P 500 slipped 0.16%, and the Nasdaq Composite slid 0.24%. All three major U.S. indexes earlier this week notched the latest in a string of recent all-time highs.

Investors continued to monitor the drumbeat of headlines on attempts to resolve trade tensions between the U.S. and China.

China’s chief trade negotiator late last week invited his American counterparts for a new round of face-to-face talks, according to people briefed on the matter, The Wall Street Journal reported Thursday. Chinese officials hope the negotiations can take place before the Thanksgiving holiday, but the U.S. side hasn’t committed to a date.

That report came less than a day after President Trump criticized China’s efforts to reach a trade agreement, escalating concerns that the world’s two biggest economies won’t reach a deal this year.

Overseas, the pan-continental Stoxx Europe 600 index retreated 0.4%, led by losses in sectors most exposed to the global economic impact of worsening trade tensions.

Investors who parsed Federal Reserve meeting minutes released Wednesday found central bank officials said little about what would prompt them to resume interest-rate cuts when they signaled a pause following last month’s rate reduction.

The health of the U.S. economy has been a focus of investors, and a recent drive into shares of economically sensitive companies, like banks and manufacturers, has suggested optimism about the economic outlook. New data Thursday showed the number of Americans applying for first-time unemployment benefits held steady at a near five-month high last week, above the level expected by economists surveyed by The Wall Street Journal. The recent rise in jobless claims could be an early indication of a cooling labor market, or it could reflect seasonal volatility around the holidays.

The yield on the benchmark 10-year U.S. Treasury was 1.781%, up from 1.737% Wednesday. Bond yields rise as prices fall.

Energy shares led gains among S&P 500 sectors, rising 1.1% as U.S. crude oil rose 2.3%.

Company-specific news drove swings in individual stocks. Shares of Charles Schwab jumped 6.6% after CNBC reported that the brokerage is in talks to buy TD Ameritrade Holding and a deal could be announced as early as Thursday. TD Ameritrade surged 18%. Rival E*Trade Financial dropped 9%.

Shares of Tiffany rose 2.6% following a Reuters report that LVMH Moët Hennessy Louis Vuitton SE has gained access to the jewelry retailer’s books after it improved its takeover offer to nearly $16 billion.
Regards,
Ted
Bloomberg Evening Briefing:
https://www.bloomberg.com/news/articles/2019-11-21/your-evening-briefing

MarketWatch:
https://www.marketwatch.com/story/us-stock-futures-pare-losses-after-report-chinas-liu-cautiously-optimistic-over-trade-deal-2019-11-21/print

WSJ:
https://www.wsj.com/articles/stocks-fall-on-dimming-hopes-for-u-s-china-trade-talks-11574315113

Bloomberg:
https://www.bloomberg.com/news/articles/2019-11-20/asia-stocks-set-for-caution-on-u-s-china-tensions-markets-wrap

IBD:
https://www.investors.com/market-trend/stock-market-today/dow-jones-down-239-points-for-week-china-concerns-tesla-stock-hits-buy-point/

CNBC:
https://www.cnbc.com/2019/11/21/us-stocks-wall-street-in-focus-amid-earnings-data-and-trade-talks.html

Reuters:
https://uk.reuters.com/article/us-usa-stocks/wall-street-muted-on-doubts-over-progress-in-u-s-china-trade-deal-idUKKBN1XV1GM

U.K:
https://uk.reuters.com/article/uk-britain-stocks/uk-stocks-fall-as-trade-fears-labour-manifesto-weigh-idUKKBN1XV0UN

Europe:
https://www.reuters.com/article/us-europe-stocks/trade-woes-knock-european-shares-for-the-fourth-day-thyssenkrupp-slumps-idUSKBN1XV12X

Asia:
https://www.cnbc.com/2019/11/21/asia-markets-november-21-us-china-trade-hong-kong-protests-currencies.html

Bonds:
https://www.cnbc.com/2019/11/21/us-treasury-yields-amid-us-china-trade-tensions-jobless-claims.html

Currencies:
https://www.cnbc.com/2019/11/15/forex-markets-us-china-trade-deal-in-focus.html

Oil
https://www.cnbc.com/2019/11/21/oil-markets-us-china-trade-deal-in-focus.html

Gold:
https://www.cnbc.com/2019/11/21/gold-markets-us-china-trade-deal-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

Comments

  • edited November 22
    Strange day. My funds, and those I track, are all over the place. Conservative (40/60) TRRIX dropped .26%, while Index 500 VFINX lost only .15%. Obviously rates somewhere along the yield curve spiked. T Rowe’s tech-heavy blue chip fund TRBUX held up reasonably well with a modest .23% loss, while Hussman’s defense oriented HSGFX lost more than twice that much. The REIT fund I formerly owned (OREAX) got clocked pretty good, down more than 1.5%, consistent with an increase in rates. And my usually sedate alternative fund TMSRX experienced a .30% loss, signifying that even five separate teams of brains working together couldn’t figure out how to profit from today’s market gyrations. Just a few observations here .... None of this should supplant @Ted’s rigorously thorough market summary.

    Edit: DODBX bucked the trend with a .30% gain. They’ve been overweight financial stocks that might benefit from higher rates. Generally, DODBX has been catching up with its peers after a slow start to the year. Overall, there seems to be much market fixation on where rates are headed. Federal Reserve is always front and center. Perhaps not unlike Alice in Wonderland - “Sentence first–verdict afterward."
  • All my bond funds are down a bit as the stock funds - unusual for sure. Mixed signal from Hong Kong situation and it is getting worse.
  • Yes, It's very hard to see how the Hong Kong situation can be resolved to the satisfaction of both Hong Kong and Bejing. My thought is that the young folks of Hong Kong must feel like fish being caught up in a net and struggling against the inevitable outcome sure to follow. They know that the death of Hong Kong at the hands of Bejing is just a matter of time, one way or another. For the older people, not so much of a problem. For the younger ones, they know that they are as good as dead anyhow, so what's to lose by going down fighting?
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