Year to Date Market Indices as of Market Close July 16, 2019

Dow 27,335 (17.28%)
S&P 3,004 (19.94%)
NASDAQ 8,222 (23.93%)
Gold $1404 (8.70%)
OIL $58.07 (.76%)

US stocks mixed on trade concerns

Trump on Tuesday warned that ample work remains on reaching a trade deal with China and resumed threats to impose tariffs on $325 billion imports from the Asian nation. The comments come after Trump and Chinese President Xi Jinping agreed to withhold the imposition of any new tariffs amid fresh negotiations.

Powell reiterated his dovish view on interest rates during a speech, saying the central bank will act as appropriate to sustain the U.S. economic expansion. The futures market is fully pricing in a quarter-point rate cut on July 31, with a 29 percent probability for a half-point cut. Meanwhile, investors reacted to second-quarter earnings results from JPMorgan Chase, Wells Fargo, Johnson & Johnson and other top U.S. firms.

Shares of Goldman Sachs rose after the investment bank exceeded estimates with profits of $5.81 per share. The firm raised its quarterly dividend 47 percent to $1.25 per share after the Federal Reserve backed its 2019 capital plan, which includes $7 billion in share repurchases.

Outside of Wall Street banks, Johnson & Johnson reported a 42 percent hike in profits to $2.08 per share despite a 1.3 percent decline in total sales to $20.5 billion. Sales in its pharmaceutical division, which accounts for the bulk of the health care conglomerate’s earnings, grew 1.7 percent to $10.5 billion. Johnson & Johnson is facing ongoing scrutiny over its role in the U.S. opioid crisis and potential cancer risks from its baby powder.

Movers & Shakers: July 16, 2019

Wall Street holds steady after two-days of record closes as JPMorgan Chase, Johnson & Johnson earnings roll in. The top three equity benchmarks are little changed in futures trading Opens a New Window. on Tuesday following JPMorgan Chase’s second-quarter earnings beat and positive comments from CEO Jamie Dimon who said, “We continue to see positive momentum with the U.S. consumer – healthy confidence levels, solid job creation and rising wages…” Investors will also be watching this morning for reports from other top U.S. firms, including Goldman Sachs and Johnson & Johnson, on financial results through June, United Airlines reports after the closing bell today.

A top Facebook executive to testify in front of Congress on Libra as the new digital currency faces crowing scrutiny. David Marcus, who heads the social media giant’s digital wallet, will appear before the Senate Banking Committee at 10 a.m. EST. His testimony comes as key government officials Opens a New Window. and lawmakers increasingly express concern over Libra, Facebook’s new cryptocurrency. The most recent criticism came from Treasury Secretary Steven Munchin Opens a New Window. , who told reporters he was “not comfortable” with the launch of the offering mirroring recent comments from Fed Chair Powell and President Trump.

The Google-Peter Thiel battle continues. Billionaire Peter Thiel upped his criticism of the tech giant during an interview on Fox News on Monday, telling host Tucker Carlson that CEO Sundar Pichai should answer questions Opens a New Window. on Google’s decision to work with the Chinese military and whether any foreign intelligence agencies have penetrated the company’s internal networks. Google maintains that Thiel’s accusations Opens a New Window. are false, but declined to elaborate beyond the denial.

Around the Web:

Fed chair in spotlight: Federal Reserve Chairman Jerome Powell. reiterated on Tuesday that policymakers at the central bank will “act as appropriate” in order to sustain the record-long economic expansion in the U.S., once again setting the table for an interest rate cut at the end of the month.

In prepared remarks delivered at a conference in Paris, Powell laid out the case for easier monetary policy, most notably uncertainties surrounding trade developments, the U.S. debt ceiling and Brexit, as well as concerns about softening global growth.

Inflation also remains muted, undershooting the Fed’s 2 percent target this year. In May, the core PCE price index rose slightly to 1.6 percent.

Oil: oil prices continue to climb as a storm in the Gulf of Mexico has forced producers to evacuate platforms. Production in the Gulf was cut nearly by a third on Wednesday by the evacuations. Also adding to concern is an incident with a British tanker in the Middle East. Brent crude futures rebounded from early losses and were at $67.41 a barrel. Brent rose 4.4 percent in the prior session.

Stocks got a strong start to the week after a meeting at the G20 summit in Japan eased tensions in the trade conflict between the United States and China. The countries agreed to resume negotiations, with the United States holding off on further tariff increases for now and China pledging to purchase additional U.S. goods.

Retail: IKEA plans to close its only U.S. factory site and shift operations to Europe.

The Swedish furniture company’s Danville, Virginia, manufacturing facility will close in December, cutting about 300 jobs, The Wall Street Journal reported.

IKEA produces wood-based products like the KALLAX shelves and BESTA storage units at the 930,000-square-foot facility, which opened in 2008. The company said its production costs in Europe will be lower and that importing the goods will make its products more affordable in North America, according to the report.

“We made every effort to improve and maintain the competitiveness of this plant, but unfortunately the right cost conditions are not in place to continue production in Danville, Va., for the long-term,” plant site manager Bert Eades told the Journal.

The views presented are not intended to be relied on as a forecast, research or investment advice and are the opinions of the sources cited and are subject to change based on subsequent developments. They are not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investments.