Last week, meetings in Washington between China and the U.S. made little progress toward a resolution. More details emerged about the impediments to achieving a trade deal. Significant differences remain between the two countries, and I expect China to dig its heels in as negotiations continue behind the scenes over the next few weeks. This increase in public rhetoric, and most likely additional tariffs and retaliation in the short term, will give markets pause and likely lead to losses. In the end, a trade deal is preferable from everyone’s perspective as fair trade is economically better in the long term.
The other major event in U.S. equities last week was the highly anticipated Uber IPO. The disappointing performance of the stock after its IPO is likely to weigh on the market for the next few weeks as the stock will be a proxy for sentiment.
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