Excerpt from Louis Navellier's Marketmail - 7/2/2019
The S&P 500 posted its best first half (+17.3%) since 1997, capped by the best June (+6.9%) since 1955. Stocks were especially strong on the last two days of June, likely to quarter-ending window dressing, which is a very good sign that institutional buying pressure will likely persist as earnings season heats up!
Early last week, the market was essentially “on hold” as investors waited for the outcome of last weekend’s G20 meeting in Japan with President Trump and Chinese President Xi, but on Wednesday, Treasury Secretary Steven Mnuchin said on CNBC that “we are about 90% of the way [to a deal] and I think there’s a path to complete this,” which raised hope for a positive outcome and possible trade deal.
In exchange for returning to the negotiating table to pick up where China and U.S. trade negotiators left off, President Trump has agreed to postpone any additional tariffs, creating a face-saving atmosphere that makes both Trump and Xi both look good to their respective countries for negotiations over the summer.
Our authors have mixed views of the G20 summit. Bryan Perry fears that their posturing may be more “lipstick on a pig” than real progress, while Ivan Martchev sees signs of progress in both North Korea and China trade. Both see a rising U.S. market in the second half. Gary Alexander chronicles a great first half but sees “termites” eating away at our future growth in the form of high and rising deficits. Jason Bodner dives deep into last week’s anomaly in falling indexes across the board – except for the Russell 2000. Then I’ll return with a look at the latest indicators and the new debate between recession or 2% growth?
Income Mail: Lots of Lipstick Applied to the G20 Deal
By Bryan Perry
Back to Business as Usual for the Stock Market
Growth Mail: First Half “Post-Mortem” Looks More Like a “Resurrection”
By Gary Alexander
Long-Term Threat from Trillion-Dollar Annual Deficits
Global Mail: High-Level Diplomacy – Now on Sale
By Ivan Martchev
China’s “Kung Fu Debt Pile”
Sector Spotlight: Reverse-Engineering Last Week’s Russell 2000 Increase
By Jason Bodner
What Made the Russell 2k Rise While Most Indexes Declined?
A Look Ahead: Weak Economic News Virtually Guarantees a Rate Cut in Late July
By Louis Navellier
The Current Debate: A Recession Ahead, or 2% GDP Growth?