Friends
Today was the NYSE’s 225th birthday. It wasn’t very cheery. Stocks plummeted during the trading session as the “impeachment” term was more than casually tossed around by politicians and news pundits. I’m not going to get caught up in all of that nonsense, but it is fair to say that market participants just might be a bit concerned that the tax reform and infrastructure spending agenda is becoming less likely to be enacted any time soon. Remember, before today’s trading the S&P 500 was up more than 10% since the election. If that move was predicated on a certain set of expectations, and then if those expectations are seen as being in jeopardy, to give up some or more of those gains would not necessarily be illogical. Of course, one day does not a move make.
By the close, the Dow Jones Industrial Average was down 372 points to finish the day at 20,607. The S&P 500 was down 43 points to close at 2,357. Gold was up $23 to trade at $1,260 per ounce, while oil was up $.31 to trade at $48.97 per barrel WTI.
To keep things in perspective, today is only the 4th 1% daily move up or down in the S&P for 2017. By this time last year we had already had 31 such moves. So let’s not make too much of one day of trading. For months the markets didn’t seem to care about the political theatre that was occurring on an almost daily basis. Today, it appears that they did. Was it a cumulative effect, or simply a one day phenomenon? I know, the word “impeachment” was rampant today. I have a feeling we are going to be dealing with this “different” political environment for quite a while. Are markets adjusting to it all? In the end what will matter is what happens to the economy and corporate earnings. I guess we’ll have to wait and see about that. Just like always.
Have a nice evening everyone.
