This past week was, once again, a rollercoaster on the stock market with Brexit uncertainty, global growth concerns, the partial government shutdown, which has become the longest in US history. The end of the week showed a sharp increase in the three major US market indexes. The S&P 500 regained half of its 20% drop from September into late December.
- The weekly performances of US markets were all up across the board. The Dow Jones gained 3.0%, Nasdaq gained 2.7%, and the S&P 500 gained 2.9%.
- Since last Thursday, the Dow Jones Industrials has gained 500 points as the Wall Street Journal first reported progress over trade talks between the two world’s largest economies.
- Some US government workers have been recalled. This is only for essential services such as the Federal Aviation Administration (FAA), the Food and Drug Administration (FDA), the Internal Revenue Service (IRS), and the like. Even though these workers will not be paid, a new bill signed by Donald Trump will guarantee back pay for the 800,000 workers who’ve been forced off their jobs.
- JP Morgan CEO, Jamie Dimon, stated that, if the partial government shutdown continues through the quarter, we could expect a 0% growth.
- A Chinese report expressed concerns about global growth as Chinese exports slow down. Chinese exports dropped by 4.4% from a year ago, imports shed 7.6%, and exports to the US slid 3.5%. In order to boost the economy, China has injected $83 billion dollars into the country's financial system, which is part of the stimulus package.
- Last Tuesday, Teresa May suffered a historic defeat. Her plan to withdraw to leave EU failed. However, Theresa May survived the confidence vote, the following day. As a result, May will meet her opponents in order to constitute a Brexit consensus. Actually, there is no plan on how the UK will leave the EU by March 29, 2019, which marks the final day of the UK as a member of the EU.
- Jack Bogle, the founder of Vanguard, passed away last Wednesday. This giant investor is the inventor of the index funds concept competing directly with mutual funds. His thesis wrote in Princeton led the foundation for what would become one of the most powerful investing movements of the late 20th century.
- The US financial sector results are spectacular with Goldman Sachs, Bank of America, and other banks outperformed analysts' expectations.
- There is no official US government release regarding the ongoing trade talks between the US and China but the is a report from the Wall Street Journal stating that the US officials are debating if they should ease tariffs on Chinese imports. Indeed, China has offered a six-year buying spree to increase imports from the USA in order to zero out China’s massive trade surplus.