The Federal Reserve’s two-day meeting concludes on Wednesday. A recent shift in the Fed’s stance, hinting it is open to rate cuts to support the economy, has aided investor sentiment.
The broad-based S&P 500 Index posted its first weekly advance in five weeks. While some of the gain can be traced to short-term oversold conditions, the trigger came from expectations the Fed may be gearing up to cut interest rates.
First China, now there is the threat of steep tariffs on Mexican imports.
Impact: Stock market volatility and falling Treasury bond yields, as investors seek the safety of Treasuries (bond prices, yields move in opposite directions).
Odds of a recession by year-end remain low but have edged higher amid trade tensions that are slowing global trade flows and dampening business confidence.
The U.S. and China were moving toward a historic trade agreement. It seemed as if the missing pieces of the puzzle were about to fall into place.
Then came a surprise tweet by President Trump on Sunday May 5th. Trump said he would raise tariffs on Chinese imports into the U.S.