“A weak China and hawkish Fed can’t co-exist for any sustained period,” a member shares in our community-powered Slack group. “The dollar eventually breaks all.” His concern? An ugly fourth quarter, similar to that of 2018. This has come up in my conversations as well.
Flashback: The S&P 500 went from being up 10 percent on the year on September 20, 2018, to flat by late November. A recovery seemed underway by early December, but then markets tumbled. The S&P 500 fell 16 percent through Christmas Eve.
Stocks ignored strong historical seasonality stats and patterns.
Why: Recycled fears like Brexit, trade tensions, Fed tightening, White House chaos, China’s slowdown, and the big increase in bond yields. All these factors likely influenced sentiment to some extent, adding to the volatility.
Moreover: President Trump tweeted “I am a Tariff Man” on December 4, backing off earlier claims of a trade-war truce with China. The Fed went a
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