Your Weekly Market Blip 5/24/19

Your Weekly Market Blip 5/24/19

After getting whacked by trade fears on Thursday, markets rebounded to close out the week. The driving force of recent market volatility is all about trade negotiation headlines. At the close of business today the Dow was up 95 points at 25,585. Trading volume was very low. For the week, the Dow posted a net loss of about 165 points and has now had 5 negative weeks in a row. Both BTS and IBD indicate negative sentiment for stocks. The Dow is off about 4% from highs and is up 9% for the year.

Oil prices took a hit this week after an IEA report forecast lower global demand for crude oil. This report, coupled with strong US production and storage figures offset fears of a supply crunch after Iranian oil was sanctioned off the markets. The gurus now figure that production from Iran is off over 90% as countries like India, which accounted for 18% of Iran’s sales have found other sources to buy oil. WTI crude oil started the week at $63 per barrel but when the market pulled back, trade fears increased, and the IEA report came out, oil tumbled to its current level of roughly $58 per barrel. Some gurus think that trade issues will affect supply channels and could lead to a global slowdown if the issues persist thus the need for less oil. One economist at a firm call CPA predicted that a full-blown trade war will result in over 700,000 new jobs in America and the loss of over $300 billion in manufacturing from China as businesses move out either to other countries or back to the US.

Trading volume today was lower than a snake’s belly in a wagon rut as traders bolt Manhattan for the Hamptons and the three-day Memorial Day weekend. Markets will open again on Tuesday. Hats off to all the veterans out there. A long time ago someone wrote, “let worth be judged according to wisdom”. Let us endeavor to be wise in the understanding that service in the cause of liberty is critical to having a safe, peaceful and prosperous nation.

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