US President Donald Trump has received a major reprieve, as Special Counsel Robert Mueller’s probe didn’t find any evidence of collusion between the president’s campaign and Russia.
However, bulls hoping for a market bounce after the sell-off on March 22 could be in for a disappointment, as S&P 500 (SPY) futures are pointing to a weak opening.
Over the last week, economic growth concerns have intensified. The US Federal Reserve has signaled no more rate hikes for this year. On any other day, the move would have triggered a buying spree—but this time, it was otherwise, as the markets saw the dovish stance as an indicator of a weakening economy.
Economic data points from other countries have also been far from satisfactory, with Germany’s manufacturing purchasing managers’ index falling to a multiyear low. Optimism over a US-China trade deal also got a reality check after President Trump said that tariffs on Chinese goods could remain for a “substantial period.” Growth concerns that spooked the markets in the fourth quarter are now pretty much back on the table.
According to CNBC, Art Hogan, chief market strategist at National Securities, said, “We may well have removed a nagging concern, but the current concerns like the China trade war and overseas grief that outweighs that.” Bruce McCain, chief investment strategist at Key Private Bank, said, “I think that most people have discounted the findings of the Mueller investigation in comparison to the Chinese trade war and tensions overseas trends.”