Markets “In a Nutshell” for January 28, 2020
Investment Week at a Glance
Stocks finished down for the week. The Dow Jones Industrial Average was down 1.22%, the S&P 500 fell 1.03%, the New York Stock Exchange Composite (2,000 stocks) fell 1.44% and the average investors index (Value Line Index) was down 2.17%. Foreign stocks (DJ Global ex U.S.) were down 1.04%. Bond prices were higher for the week, with the 10-year U.S. Treasury ending the week 12 basis points lower at 1.64%. (Data source: Wall Street Journal)
Stocks Fall for the Week
The U.S. stock market fell for the week as the worries over the spread of the coronavirus in China is getting out of the control of health officials in the country. The S&P 500 and the Dow ended a two-week streak of gains and the Nasdaq ended a six-week streak. As the virus has begun to spread to multiple countries, fears of a shut down in travel, especially in China, are worrying analysts’ estimates of economic growth. The oil market plunged as a result of the expectations of canceled travel plans, while safe haven assets, such as gold and government bonds rose in value. As global efforts to contain the virus are implemented, the risks to a material slowdown in the global economy are still unlikely, but volatility in the stock market is always a risk after a massive run higher in prices last year. (Wall Street Journal)
Moving on in Trade Deals
While at the World Economic Forum in Davos, Switzerland this week, President Trump touted the trade deals his administration has agreed to with China and the USMCA, with Canada and Mexico, while also hinting that the beginning of negotiations with other countries that are on the way. President Trump and French President Emmanuel Macron agreed to a truce on tariffs at the meeting and signaled they are both open to negotiating a deal that encompasses all of Europe and the U.S. Treasury Secretary Steven Mnuchin also signaled that a deal with the United Kingdom could be done by the end of the year, assuming that the county exits the European Union as scheduled. As with Canada and Mexico, all of these future negotiations deal with political allies of the U.S., but that didn’t make the USMCA deal any easier to agree to for the U.S, Canada and Mexico. The president would like to get as many trade deals as possible before his election, but how likely that is to be accomplished is difficult to tell. (Barron’s)
With the Super bowl this Sunday and currently 20 states that have legalized sports betting, how much money is bet every year on sports illegally?
Have a Great Week!
Answer to quiz:
3. An estimated $150 billion is bet on sports each year according to the American Gaming Association. (Barron’s).