WASHINGTON. Despite that rousing post-Election 2018 rally last week, stocks seemed comfortable returning to their losing ways last week. As of 1 p.m. Monday, we find Wall Street averages in a sickening swan dive once again. Tech shares are leading most other US stocks down the Road to Oblivion. Negative factors continue to involve volatile politics, unpredictable international trade outcomes, Gonzo oil price volatility and, of course, interest rates.
Monday trading summary as of 1 p.m. Monday, 11/12/2018
The following note popped up in my trading software this morning via Briefing.com. (No link.)
“Apple (AAPL 194.13, -10.34, -5.0%), Amazon.com (AMZN 1633.65, -78.78, -4.6%), Netflix (NFLX 291.23, -12.24, -4.0%), Facebook (FB 141.12, -3.84, -2.7%), and Alphabet (GOOG 1032.57, -33.58, -3.2%) are all down noticeably today and weighing heavily on the broader market.
“The focal point, however, is Apple and the weakness it has seen since reporting its quarterly results on Nov. 1. The stock is down 12.6% since the report, which featured a weaker-than-expected fiscal first quarter outlook. That outlook fueled some demand concerns, which have been exacerbated by recent warnings from suppliers Skyworks Solutions (SWKS 72.98, -3.68, -4.8%) and Lumentum (LITE 38.73, -17.22, -30.8%).
“The information technology sector (-3.3%), and particularly the semiconductor stocks, are the problem children in today’s market. The Philadelphia Semiconductor Index is down 4.3%.
“Losses in those influential areas are feeding into general growth concerns that have led to de-risking action.”
Risk-off environment risks causing an official market correction
In this “risk-off” volume, very few hiding places exist. Utilities and Consumer Staples have been helpful ports in this storm. But on the whole, stocks seem inclined to establish an official correction before the downward trajectory finally shifts from reverse into forward. Politics, trade, interest rates and, of course, the resulting headline risks play right into the market’s negative tone.
Political risk: Macron puts his left foot into the international political pot
Not helping today were French President Emmanuel Macron’s stupid and needlessly provocative comments about “nationalism” and the need for Europe to “arm” against the US. He made those observations during this weekend’s Paris confab with President Trump and a boatload of the usual Euro-globalist elitist suspects. (So what the hell is NATO for, anyway?) All these clowns were somehow elected by “the people” even though they continue working to obliterate their nations and their history. Against the people’s will. Remind you of anywhere else?
Macron has been sinking in the French polls and likely figured he’d score points, à la Charles de Gaulle by bad-mouthing the U.S. and it’s “controversial” president. He was emboldened, perhaps, by the Democrats’ frequently ballot-boxed stuffed wins in last week’s midterm elections. Nothing’s more fun than kicking a guy while he’s down, and Macron couldn’t resist the opportunity to score cheap points. French politics as usual. No visible progress on trade issues, either. Protectionism is alive and well in the Eurozone.
More politics: Democrat wins, or simply stuffed ballot boxes?
On this side of the Atlantic, we have more politics. A number of last week’s declared election results involve close encounters of the fraudulent kind. In other words, Democrats continue their concerted efforts to steal as many elections as they possibly can. After all, they can’t will many of them unless they sneak in a few more illegal aliens.
As of Monday, to the asinine Florida ballot stuffing debacle, we can add the Georgia gubernatorial race, the Arizona US Senate contest switcheroo, plus a fresh batch of ballot-box stuffing electoral reverses in California’s already pro-Democrat rigged Congressional contests. Guess that’s all part of our “living Constitution,” eh, guys?
Adding insult to injury, Democrats, at least in Georgia and Florida (thus far) are demanding that non-citizen votes should also be “counted.” Like the Soros-fueled leftist push to eliminate national borders, and thus the United States, this push to count illegal votes by illegals needs to be squashed – permanently – by the Supreme Court.
Otherwise, why are we even bothering to pay taxes to a Federal government that no longer wants to be responsible for governing an actual country and protecting the lives, assets and property of its sadly disrespected citizens? While I’m not an attorney and don’t play one on TV, this whole lunatic notion would seem to border somewhere between sedition and treason. So why aren’t we seeing some perp walks here for the offending party and its felonious local precinct officials, particularly the serial violators of the Constitution who run Florida’s Broward County as a medieval fiefdom?
Politics are getting suicidal everywhere. In addition, much of today’s ongoing stock market confusion arises the apparently suicidal political extremism forced down our throats by phony rich socialists and governmental elitists of the West.
Oil and Middle East politics
Additional trade issue: Wildly gyrating oil prices continue to bother US and international markets as well. Indeed, oil could soon become a big issue once again, as murderous provocations continue to flare in the Middle East.
The slaughterhouse leadership of Hamas launched a significant barrage of rockets into Israel Monday morning. This most-recent provocation risks all-out war. That, in turn, could spill over into oil production across that volatile region depending on who gets involved next. It’s a worry for investors, for sure.
Not surprisingly, after its own sickening, nearly two-week swan dive, the price of crude oil finally caught a bid today. At last, West Texas Intermediate (WTI) finally rallied comfortably back above $60 bbl. But who knows what happens next? At least owners of badly beaten oil stocks seem provisionally happy today.
Interest rates: Will the Fed (needlessly) hike them again in December?
The Fed essentially didn’t say anything about interest rates last week. But it’s a virtual certainty that these goofballs will kick interest rates up another notch before 2018 comes to a close. If they keep it up in 2019, we’ll have a recession for sure. That would track nicely with other elements of the Deep State’s Election 2020 never-ending scheme to unseat President Trump. Add a recession to the Democrats’ increasingly bold-as-brass election-stealing activities, and that’s what might transpire.
This quiet but very real threat also makes markets nervous. Yet many traders and investors continue with their metaphysical approach to the Trump presidency. They hate Trump. But they love his policies. So they make money hand over fist thanks to those policies. But they continue to fund his opponents and vote against the GOP every chance they can get and vote against him as well.
How dumb is this? There seems to be no precedent for this suicical level of stupidity. Yet as I creep into my final decade(s) of life, I’ve come to understand that logical solutions to reasonably simple problems are no longer on the menu. Neither are reason and logic. But this is what happens when you throw Western Civilization, history and civics out the door.
What to do next in a volatile market?
Today’s conclusion is the same as last week’s. Investing in pretty much any stock or bond right now is no better than a crapshoot.
With such wild political winds blowing across the landscape and with common sense firmly set on its own Road to Oblivion, charts and P&L’s aren’t a big help in this environment. So it’s better for small investors like us to raise cash when we can, tuck it into some kind of “managed” money market fund – whose yields are somewhat better these days – and ride out the storm.
And resolve nevermore to vote for any party that feels compelled to win by stuffing the ballot box once they see the final numbers they need to exceed. If we, as a nation, continue to tolerate this blatant disregard for ballot box integrity, both this country and its stock market will eventually cease to exist.
—Headline image: Screen grab from “Teamwork” song from Bing Crosby’s and Bob Hope’s final “Road” picture, The Road to Hong Kong. Pictured (L-R) are hope, a young Joan Collins, and Der Bingle himself.
Rumors persist that both aging stars batted around the idea of doing one final “Road” picture.
Alleged working title: The Road to Oblivion. Crosby, unfortunately, achieved actual oblivion in the 1970s.
So obviously, that rumored film never made it to production.
Here’s the clip, via YouTube video.