Market Wrap 02.08.19

Global shares are trading lower this week, as traders unwound their bets that further US rate cuts were on the horizon and that progress was being made in the US-China trade war. The S&P 500 rose by just under 10% in June and July, largely driven by hopes that the US Federal Reserve would aggressively cut interest rates and by news of a truce in the trade war. Alas, this was not to be. The US Federal Reserve cut interest rates on Wednesday, however Fed Chair Jerome Powell was quick to signal that this was not the first of a series of rate cuts.

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US markets had recouped all of their losses until droping again after El Presidente announced that he would be raising further tariffs on China.

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Although these sharp falls may seem scary, they are mostly mild corrections for previous exuberances . Investors should consider the 2% dip this week in the context of the S&P 500 being up almost 20% in 2019!

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