Well, at least Friday was positive. After a rough week and an 8-day losing streak in the DOW, stocks finished higher on Friday. And it was oil saving the day.
Here’s what traders focused on last week:
- Trade War Concerns – A week ago Friday, President Trump announced a 25% tariff on $50 billion worth of Chinese goods. China immediately responded with tariff threats on U.S. goods. Then on Monday, President Trump threatened to impose tariffs on another $200 billion worth of Chinese goods if China retaliates, with another $200 billion in goods being considered if there’s another retaliation. Then on Friday, President Trump threatened to impose a 20% tariff on autos imported from the European Union. Although Friday’s threat had a small impact on the day, stocks were down for the week because of trade uncertainty and trade war concerns.
- Internet Taxes – On Thursday, E-commerce companies were hit after the U.S. Supreme Court ruled that states can require online retailers to collect sales tax. Amazon (AMZN) lost 2.0% on over the two days following the announcement, eBay (EBAY) was down 3.0%, Overstock.com (OSTK) lost 14.7% on Thursday and Friday.
- Crude Oil Rally – On Friday, OPEC finished its summit in Vienna, agreeing to raise output by 600,000 barrels a day. This is much lower than the 1.5 million barrels that Russia wanted and oil rallied to a 4-week high. The rally in oil helped energy stocks on Friday with companies like Chevron (CVX) and Exxon Mobil (XOM) finishing the day higher with gains of 2.0%.
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Here’s where the major indices ended the week:
- The S&P finished with a 0.9% loss. Down 25 points, the S&P ended at 2,755.
- The DOW ended 2.0% lower. Dropping 510 points, the DOW closed at 24,581.
- The NASDAQ was down 0.7%. With a 54 point loss, the NASDAQ finished at 7,693.
- Bitcoin ended 8.0% lower. Dropping $520, Bitcoin is trading at $6020.
Crude Oil (CL) had its best week in 2 months. With a 5.7% gain, CL ended at $68.53 a barrel. Most of last week’s gains came on Friday after the OPEC meetings.
Walgreens Boots Alliance (WBA) will join the Dow Jones Industrial Average this week. On June 26th, Walgreens will replace General Electric (GE).
Looking at the week ahead, it’s safe to say that traders will continue to focus on trade war concerns. President Trump’s auto tariff threat didn’t have much of an impact on Friday, but the European Union plans to respond. EU Commission Vice President Jyrki Katainen said: “If they decide to raise tariffs, we’ll have no choice, again, but to react.”
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Source: RockwellTrading by Markus Heitkoetter | Original Link