Disappointing economic data, a notable earning miss and a cooling of trade war tensions sent the major averages into the final hour mixed.
After some pretty heated rhetoric on trade with Europe both parties took a step back and agreed to resolve their differences and put the current tariffs on hold. Color me skeptical on this, but I suppose anything is possible. That said the number of companies complaining about the negative effect of trade tariffs is high and rising at 35, and I’m sure there are many others.
As the NASDAQ ran up to its blow off top in early 2000 the market got narrower and narrower pushed along by a handful of companies much like today as the so-called FANG stocks or Alphabet, Apple, Amazon, Netflix, Microsoft and Facebook drive the show. When one of them misses big, Facebook in this example with its bear market decline of 24% in the last few days. The index tends to get hit hard, and in the process shown to be very vulnerable.
Durable Goods Orders missed expectations substantially in June gaining just 1%. The proxy for business spending non-defense capital goods ex-aircraft advanced for a 3rd month with a .6% gain.
The trade deficit increased 5.4% in June to 68.3 billion. Exports fell for the 1st time in 6-months to 141.9 billion. Imports increased 210.3 billion. Various economic reports and data series will begin to reveal the true effects of the nascent trade war beginning in August.
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