WASHINGTON, March 22, 2017 – Wednesday stock market action began with a negative tone, then turned more positive in the broad based S&P 500 and the tech-heavy NASDAQ. But, as the Dow Jones Industrial Average (DJIA) finally made an attempt to catch up, news hit the tape concerning what appears to have been a two-pronged terrorist attack not only in the heart of London, but directly before Parliament itself.
With details coming in, it appears that a lone attacker charged a London policeman and succeeded in stabbing him before he was killed by other police on the scene. At roughly the same time, in an attack reminiscent of those recently carried out in continental Europe, a driver swerved into pedestrians on Westminster Bridge, mowing a number of them down.
Latest reports, which may not be final, list the current death total at 4—including the Parliament-based attacker and the policeman he stabbed—as well as 20 injured, likely including the pedestrians who were hit on the bridge.
Below is a recent NDTV video report on the attack, obtained via YouTube:
Today’s attack may be at least peripherally related to the urgent actions taken by the British and American governments to curtail most carry-on computer and electronic commitment on flights from certain Middle East destinations and airlines.
At times, when a primary terrorist plot is compromised, terrorists will resort to a “Plan B,” which might be what transpired in London today, although we’ll clearly have to wait for further clarification on this in the coming days and weeks.
Other things continuing to destabilize today’s market action: the ripple effect of the warning from Sears Holdings (SHLD) that the onetime king of American retail, Sears, might go out of business before year’s end; gossip being intentionally spread via CNBC and other “news” outlets that a “clash” between President Trump and Fed Chair Janet Yellen is imminent; continued weakness in the price of oil and other commodities; continuing fallout from the ongoing “fake news” surrounding the alleged collusion of Trump campaign officials and the Russians leading up to last year’s November election; and the uncertain fate of the House’s apparently wobbly attempt at a “Phase I” bill that at least begins to “repeal and replace” Obamacare.
The media is currently portraying the House bill as a failure, which is unlikely to pass, which is a distinct possibility. But the media is also prepared to judge any setback in the House as proof that the Trump Presidency is an absolute failure—this just 60-odd days into the new administration, which is still being deprived of key department heads and top officials by the army of “just-say-no” Democrats on the Hill.
It’s this kind of serial chaos that tends to upset investors. On the other hand, the market in general has been ripe for either a correction or a cooling off period after the recent torrid, post-election “Trump Rally” that’s been proceeding pretty much unabated since the chaotic morning of November 9, 2016, when the nation awoke to find that Hillary Clinton had been thwarted in her ambitions yet again.
A great deal of the false static masquerading as news that’s the current stock and trade of the traditional press corps may be starting to take a toll on the national spirit. But that said, at this stage of 2017 at least, it’s not yet deterred Trump’s growing band of supporters, which is, after all, the obvious intent of this kind of nonstop, nakedly partisan coverage.
That’s at least in part why, relentless negativity to the contrary, the nation’s mood actually remains optimistic for the most part and why the stock market has, until yesterday at least, been merrily rolling along.
Even so, it’s time for a break anyway until actual business activity begins to catch up with the price of stocks. For that reason alone, media flapdoodle and lies aside, stocks should at least stall at this point, or even sustain a relatively nasty short term correction to relieve more of the overbought condition than we’ve already seen.
The next few days will be tricky. If the House fails to pass its Ryancare replacement for Obamacare tomorrow, the naysayers and short sellers will probably gang tackle the averages. So we’ll just watch and wait until the garbage clears while continuing to raise bits of cash where we can, the better to buy back in when the current nonsense runs its course.