Market opens flattish to begin the holiday-shortened week. Things are on track for a decline in May, something that has not occurred in 7 years. The S&P has seen 3 consecutive weekly decliners for the first time this year. The DOW is down 5 straight weeks, the longest since 2011. Breadth has weakened considerably and money has flowed into bonds. The 10-Year Treasury yield is below 2.3% now, for the first time since September. But, despite the weak stretch for stocks, the S&P is only down 4% from the all-time highs reached in April. The 2800 level has been tested and held. It will likely be tested again, perhaps this week. Things are far worse in Small Caps and overseas. Crude Oil has been beaten up too, as have Energy stocks. There are plenty of areas of pain that the overall Market has masked. The question is can it continue. Global Markets were mixed overnight. Both the US and UK were closed Monday. Trade remains in focus this morning, with President Trump telling reporters Monday that the US is not ready to make a trade deal with China. And China is reportedly preparing to dig in for a long battle here. Was this all part of the plan? Don’t know, but the Market seems to be taking it all in stride, despite the large quantity of economic data showing slowing. The American President was in Japan over the weekend. A trade deal with the other Asian nation could be announced in August.
Have a great morning,
Mike Frazier
