Stocks today were on a wild ride. They opened higher on economic and trade optimism but then reversed and at the close was down 165. The trade issue is a big question mark for the markets. While everyone we talk to seems to acknowledge good underlying economic fundamentals the trade talks are an unknown and this appears to be driving market volatility. BTS is still positive on markets and IBD has the rally under pressure.
Trade issues around the globe continue to roil markets. In an interesting development, Canada is preparing tariffs and quotas on steel from China in an effort to prevent a potential flood of steel imports as global producers seek to avoid US tariffs by sending product through Canada. What happened was that back in March of 2016 the Obama administration put tariffs on Chinese steel imports. The Chinese then responded by using Canada, Japan and Europe as a back door into the US but the latest tariffs on all countries by the Trump administration is forcing these countries to address the indirect dumping problem. These developments are putting pressure on China which has seen its stock market fall into bear territory this year. Meanwhile several US steel companies are now restarting or building new steel plants and some international steel companies are building plants in the US so they don’t get locked out of US markets by the tariffs.
Last weekend the Boy Scouts had our annual family camp on Whidbey island to mark the end of the scouting year. We had a big dinner, scout bucks, parent auction and a court of honor where we elected a new SPL (Senior Patrol Leader) who will effectively run the troop for the coming year. A good time was had by all and the best part was that we were able to utilize the flaming arrow of malnutrition (pop tarts) to light the fire that burned during the court of honor.