Mike’s Morning Brief – April 10, 2019

What’s going on in the world…

Market opens in the green after yesterday’s selloff snapped the 8-day S&P win streak. Renewed trade tensions triggered the selloff as the US and Europe are sparring on tariffs. China and Europe have been working on a trade deal, and seemingly using it as leverage against the US. This came after the IMF lowered expectations for the global economy for the second time. Growth is slowing. Stocks still remain just under all-time highs reached last September, having erased nearly all of the Q4 declines. The European Central Bank kept rates unchanged and signaled further downward pressures to the European economy, emphasizing its plan to stay on the defensive. This is no surprise. It will be interesting to see how the Federal Reserve responds. The Fed Minutes from the March meeting will be released today, but more importantly is what they say and do tomorrow, and beyond. Brexit will likely get another extension today, kicking that can again down the road. The white-hot IPO market seems to have cooled already as LYFT is trading over 10% below its initial price. That doesn’t bode well for UBER or Pinterest or the list of other Unicorns that are feverishly trying to sell in this elevated environment. The read-through is high prices might not be sustainable for much longer. We shall see. We are paying very close attention. Crude Oil continues to hold the highs on the year, up nearly 40%. Interest rates keep falling, another tell of potential trouble under the hood. There’s so much going on.

Have a great morning,

Mike Frazier