Riding the Market Wave (Or Ripple)

It is Friday, the 11th of April and the seventh business day since the very effective tariff war began. On April 2, the Dow closed at 42,225. It presently stands at 39,700, a difference of 2,525 or about 0.94, or less than 1%. At noon. In not quite 7 days.

 

To put the recent gyrations in perspective, on October 19,1987, the Dow closed at 1,738 and lost 508.00 or 22.1% of its value. In one day.

This loss, as of noon today, took over a week to get us here. When you consider that if you didn’t sell ANY of your portfolio during that time, then on paper, you lost no cash value.

And of course, NASDAQ and S&P investors have played the game of “follow the leader”.

This morning, it was announced that China responded to the latest tariff hikes by the US and will match the American hike to 125% on Saturday, but will go no higher.

China’s Commerce Ministry said it was filing another lawsuit with the World Trade Organization on the raising of US tariffs. But it failed to mention that it was manipulating its currency, the Yuan, in order to make its products cheaper for the world at-large to buy its products.

Missing that small detail, eh, President Xi?

Meanwhile, the drop in the market on Thursday was caused by profit-taking by investors looking to cash in on Wednesday’s record-breaking increase after President Trump paused the tariffs on everyone except China. 

After a morning selloff of 1,800 points, the Dow actually rebounded to close down only just over 1,000 points. Do the math.

Today will be a one of a market in flux, moving between up 200 and down 300 from yesterday’s close of 39,593. Considering the wild preceding six trading days, it is a market looking for its balance before another weekend of uncertainty.

So sit tight and watch how the market responds for the rest of the day. Maybe you will be surprised what the investors do next.

After all, we are Americans, not Panicans, so BE COOL!