After a charmed start to 2019, the stock market was shocked out of complacency last week as President Donald Trump reignited trade-war tensions with China.
The benchmark S&P 500 suffered through its worst week of the year, tumbling 2.2%, while global equities saw as much as $1.4 trillion erased at one point. In retrospect, it was to be expected considering the market had long been priced for a successful trade-war resolution.
That scenario seems a long way off now, with the US and China continuing to volley threats back and forth. That has equities plummeting once again, and strategists across Wall Street are scrambling to advise their clients how to navigate the volatility.
Goldman Sachs recently unveiled a strategy that involves seeking out service providers, as opposed to goods producers the firm sees as more vulnerable to tariff risk. The recommendation was a follow-on to a trade previously laid out by Goldman: buy reasonably priced growth stocks.
Meanwhile, Wells Fargo derivatives strategy extraordinaire Pravit Chintawongvanich noticed a compelling mispricing in the options market, which led him to suggest a simple trade involving small-cap equities.
Uber’s IPO was the other top story of last week. So far, the ride-sharing giant is struggling with the same turbulent market conditions that tripped up its main competitor, Lyft. One recent study we covered suggests that the rush of IPOs from big, unprofitable companies like Uber and Lyft could throw the entire market off track — so consider yourself warned.
Here’s a rundown of our other main coverage from last week, which featured continued dispatches from the Milken Institute Global Conference, as well as a sitdown with so-called bond king Jeff Gundlach:
An investment chief overseeing $100 …read more
Source:: Business Insider