S&P 500’s best-performing stock this year is also the most heavily shorted

However, it is also the most shorted stock of the S&P 500 at 50% of its float. High short interest could squeeze out more gains in this rally over the short term, says one technical analyst. “Near term the stock is still quite bullish,” Mark Newton, founder of Newton Advisors, said Wednesday on CNBC’s “Trading Nation. ” I see the stock going to $14.50 to $15 near term.” Tepper instead prefers another beauty stock over Coty.


However, it is also the most shorted stock of the S&P 500 at 50% of its float. High short interest could squeeze out more gains in this rally over the short term, says one technical analyst. “Near term the stock is still quite bullish,” Mark Newton, founder of Newton Advisors, said Wednesday on CNBC’s “Trading Nation. ” I see the stock going to $14.50 to $15 near term.” Tepper instead prefers another beauty stock over Coty.
S&P 500’s best-performing stock this year is also the most heavily shorted Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-16  Authors: keris lahiff
Keywords: news, cnbc, companies, beauty, sp, term, 15, stock, short, shorted, tepper, heavily, bestperforming, near, newton, quite, 500s


S&P 500's best-performing stock this year is also the most heavily shorted

One stock has been a surprise winner on the S&P 500 this year: Coty.

The beauty retailer has exploded 102% in 2019, by far the best performer of the benchmark index.

However, it is also the most shorted stock of the S&P 500 at 50% of its float.

High short interest could squeeze out more gains in this rally over the short term, says one technical analyst.

“Near term the stock is still quite bullish,” Mark Newton, founder of Newton Advisors, said Wednesday on CNBC’s “Trading Nation. ” “Technically the stock has started to act quite well, breaking out on very heavy volume, almost three or four times average of late. I see the stock going to $14.50 to $15 near term.”

Anything past that critical level looks like a tougher ask, though, says Newton.

“You do see some headwinds right near $15. The stock did come down from a high of over $30 back in 2015,” said Newton. It’s “still coming down off a big, long decline in the stock … For investors, it needs to clear $15 to really be out of the woods.”

Mark Tepper, president of Strategic Wealth Partners, says fundamentals also don’t support a long-term breakout.

“Their overall strategy, in my opinion, is still flawed,” Tepper said during the same segment. “With their acquisition from P&G, they’ve basically doubled down on mass consumer, but consumer buying trends have changed. Consumers now want experience, they want prestige, they want boutique, not CoverGirl. And [Coty’s] debt levels are sky high.”

Tepper instead prefers another beauty stock over Coty.

“If you’re going to be in this space I’d rather own Ulta. It’s a better company, no debt, and it gives you exposure to whichever brands are in favor at that given time, ” said Tepper.

Ulta Beauty has also had an impressive year, rallying 41% since January. That puts it on track for its best year since 2015 when it went public.


Company: cnbc, Activity: cnbc, Date: 2019-05-16  Authors: keris lahiff
Keywords: news, cnbc, companies, beauty, sp, term, 15, stock, short, shorted, tepper, heavily, bestperforming, near, newton, quite, 500s


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Dow rises more than 100 points, erasing 190-point drop, as Trump delays auto tariffs

Stocks rose on Wednesday on news that President Donald Trump plans to delay the implementation of auto tariffs. The Dow Jones Industrial Average closed up 115.97 points at 25,648.02 after falling as much as 190 points earlier in the session. The S&P 500 gained 0.6% to end the day at 2,850.96 while the Nasdaq Composite rose 1.1% to 7,822.15. The U.S. also raised the possibility of slapping tariffs on an additional $300 billion in goods from China. “Tariffs result in higher inflation, increased po


Stocks rose on Wednesday on news that President Donald Trump plans to delay the implementation of auto tariffs. The Dow Jones Industrial Average closed up 115.97 points at 25,648.02 after falling as much as 190 points earlier in the session. The S&P 500 gained 0.6% to end the day at 2,850.96 while the Nasdaq Composite rose 1.1% to 7,822.15. The U.S. also raised the possibility of slapping tariffs on an additional $300 billion in goods from China. “Tariffs result in higher inflation, increased po
Dow rises more than 100 points, erasing 190-point drop, as Trump delays auto tariffs Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-15  Authors: fred imbert
Keywords: news, cnbc, companies, 190point, trade, delays, sp, rises, points, growth, stocks, trump, tariffs, nasdaq, dow, raised, drop, rose, auto, erasing, gained, china


Dow rises more than 100 points, erasing 190-point drop, as Trump delays auto tariffs

Stocks rose on Wednesday on news that President Donald Trump plans to delay the implementation of auto tariffs.

The Dow Jones Industrial Average closed up 115.97 points at 25,648.02 after falling as much as 190 points earlier in the session. The S&P 500 gained 0.6% to end the day at 2,850.96 while the Nasdaq Composite rose 1.1% to 7,822.15.

Three sources told CNBC the administration will delay those levies by up to six months. The news, which was first reported by Bloomberg News, sent auto stocks higher. Fiat Chrysler’s U.S.-listed shares rose 1.9% while Ford Motor and General Motors gained 1.2% and 0.9%, respectively.

“If you look at today’s market action, it does show how sensitive investors have become to trade news,” said Jeff Kravetz, regional investment director at U.S. Bank Wealth Management. “What it may do is put equities in a range-bound mode as investors wait on the outcomes of trade tensions.”

Other stocks lifting the market included Boeing and Alphabet. Boeing shares rose 0.8% after the Federal Aviation Administration said it expects the aerospace giant to submit its software fix for the 737 Max plane soon. Alphabet, meanwhile gained 4.1% after Deutsche Bank raised its price target on the tech giant to $1,400 from $1,300.

Equities initially fell after the release of weaker-than-expected economic data stoked fears that the U.S.-China trade war is dragging down global economic growth.

U.S. retail sales fell 0.2% in April, the Commerce Department said Wednesday. Economists polled by Dow Jones expected an increase of 0.2%.

Overnight, data released in China showed industrial production rose by 5.4% in April on a year-over-year basis, notching the slowest pace of growth since May 2003. Economists polled by Refinitiv expected an expansion of 6.5%. Chinese retail sales also disappointed economists.

The disappointing data from both countries comes as trade tensions between China and the U.S. have reignited. Earlier this week, China hiked tariffs on $60 billion worth of U.S. goods. The move came after the U.S. raised levies on $200 billion worth of Chinese imports. The U.S. also raised the possibility of slapping tariffs on an additional $300 billion in goods from China.

Trump tweeted on Tuesday that the U.S. is in a “much better position now than any deal we could have made.”

“The escalation of the U.S-China trade war is unequivocally a negative for the growth outlooks for both countries and the global economy,” Veneta Dimitrova, senior U.S. economist at Ned Davis Research, wrote in a note. “Tariffs result in higher inflation, increased policy uncertainly, slower capex and employment growth, and weaker productivity growth.”

“The longer tariffs stay in place or rise in size and scope, the greater the downside risk to the U.S. growth outlook,” Dimitrova said.

The rising trade fears sent equities reeling this month. The Dow and S&P 500 are down 4.6% and 4.2%, respectively, while the Nasdaq has fallen 4.9%.

Earlier this year, the S&P 500 and Nasdaq reached record highs in part because both China and the U.S. indicated progress was being made on the trade front.

But the increasing trade fears have made the market’s short-term outlook “unpredictable,” according to Craig Birk, chief investment officer at Personal Capital.

“You have to accept that it’s going to be a coin-toss if you’re worried about the next day or week. It’s a negotiation,” Birk said. “There will be positioning and there will be developments, some will be positive and some will be negative. We’ll continue to have more choppiness.”


Company: cnbc, Activity: cnbc, Date: 2019-05-15  Authors: fred imbert
Keywords: news, cnbc, companies, 190point, trade, delays, sp, rises, points, growth, stocks, trump, tariffs, nasdaq, dow, raised, drop, rose, auto, erasing, gained, china


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Cramer: ‘I don’t trust this market at all’ because it’s so dependent on Trump tweets

“I don’t trust this market at all,” Cramer warned on “Squawk on the Street” as stock futures pointed to a higher Wall Street open, which in fact came to pass through the morning. Cramer said he was troubled by Trump’s barrage of tweets Tuesday, calling them “a little erratic,” including the one about the Federal Reserve. Trump is “really disturbing the zeitgeist of the stock market,” Cramer said. However, in light of the uncertainty around Trump’s new tweets, Cramer on Tuesday advised investors


“I don’t trust this market at all,” Cramer warned on “Squawk on the Street” as stock futures pointed to a higher Wall Street open, which in fact came to pass through the morning. Cramer said he was troubled by Trump’s barrage of tweets Tuesday, calling them “a little erratic,” including the one about the Federal Reserve. Trump is “really disturbing the zeitgeist of the stock market,” Cramer said. However, in light of the uncertainty around Trump’s new tweets, Cramer on Tuesday advised investors
Cramer: ‘I don’t trust this market at all’ because it’s so dependent on Trump tweets Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-14  Authors: matthew j belvedere
Keywords: news, cnbc, companies, trumps, stock, worth, sp, trump, trust, dependent, wall, tweets, cramer, street, dont, market, 500


Cramer: 'I don't trust this market at all' because it's so dependent on Trump tweets

CNBC’s Jim Cramer voiced concern about the staying power of the stock market’s bounce Tuesday following President Donald Trump’s latest tweetstorm on China trade and Monday’s sharp decline.

“I don’t trust this market at all,” Cramer warned on “Squawk on the Street” as stock futures pointed to a higher Wall Street open, which in fact came to pass through the morning. “[Trump] has made it so we got to wait to be able to buy.”

Cramer said he was troubled by Trump’s barrage of tweets Tuesday, calling them “a little erratic,” including the one about the Federal Reserve.

Trump is “really disturbing the zeitgeist of the stock market,” Cramer said. “He should knock the tweets off if he wants the Dow to start going up, at least today.”

On “Mad Money” on Monday evening — after the Dow Jones Industrial Average and the S&P 500 each lost about 2.4% on China’s tariff response to last week’s U.S. hike — Cramer said Wall Street is nearly oversold and investors should get ready to load up on names that can withstand higher tariffs.

However, in light of the uncertainty around Trump’s new tweets, Cramer on Tuesday advised investors to let things shake out, saying there may be a buying opportunity in stocks later in the session.

In late morning trading, the S&P 500 was making up about half of Monday’s losses, which had sent the index down for a total of nearly 5% from its May 1 intraday all-time high. So far in 2019, the S&P 500 has gained about 13% — and since the crushing Christmas Eve 2018 low, the index has soared more than 20%.

On Monday, China said it will raise tariffs, some to as high as 25%, on $60 billion in U.S. goods, in retaliation for the Trump administration’s decision last week to increase duties on $200 billion worth of Chinese products from 10% to 25%.

Meanwhile, the Office of the U.S. Trade Representative is taking steps to prepare to slap tariffs on the remaining billions and billions of dollars worth of Chinese goods coming into the U.S.


Company: cnbc, Activity: cnbc, Date: 2019-05-14  Authors: matthew j belvedere
Keywords: news, cnbc, companies, trumps, stock, worth, sp, trump, trust, dependent, wall, tweets, cramer, street, dont, market, 500


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Here’s what Wall Street thinks of the unfolding trade deal drama: ‘Potential for a bear market’

In a note to clients, Bank of America outlined three trade scenarios and its implications for the broader market. “The worst-case scenario: an all-out trade war, with tariffs on the remaining Chinese goods, retaliation from China, and an increased risk of auto tariffs that could push the global economy into recession,” wrote Savita Subramanian. “Under a deal, we expect the S&P 500 could rally above 3000 near-term…while under a full-fledged trade war, the S&P 500 could pull back 5-10% near-term


In a note to clients, Bank of America outlined three trade scenarios and its implications for the broader market. “The worst-case scenario: an all-out trade war, with tariffs on the remaining Chinese goods, retaliation from China, and an increased risk of auto tariffs that could push the global economy into recession,” wrote Savita Subramanian. “Under a deal, we expect the S&P 500 could rally above 3000 near-term…while under a full-fledged trade war, the S&P 500 could pull back 5-10% near-term
Here’s what Wall Street thinks of the unfolding trade deal drama: ‘Potential for a bear market’ Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-10  Authors: michael bloom, carlos barria
Keywords: news, cnbc, companies, street, drama, wall, china, war, expect, trump, tariffs, potential, market, trade, sp, marketthe, thinks, unfolding, bank, deal, heres


Here's what Wall Street thinks of the unfolding trade deal drama: 'Potential for a bear market'

In a note to clients, Bank of America outlined three trade scenarios and its implications for the broader market.

“The worst-case scenario: an all-out trade war, with tariffs on the remaining Chinese goods, retaliation from China, and an increased risk of auto tariffs that could push the global economy into recession,” wrote Savita Subramanian.

“Under a deal, we expect the S&P 500 could rally above 3000 near-term…while under a full-fledged trade war, the S&P 500 could pull back 5-10% near-term, with potential to enter a bear market.”

“The next focal point for markets will be whether we see Trump and Liu actually meet. As mentioned, a potential release valve for sentiment would be if Trump and Xi speak on the phone following Liu’s visit,” Deutsche Bank said.

“We expect China to hike retaliatory tariffs, and the US to begin the process of imposing tariffs on all other imports from China, but further US tariff increases are still unlikely in our view and would likely take a couple months to implement,” said Goldman Sachs chief economist Jan Hatzius.


Company: cnbc, Activity: cnbc, Date: 2019-05-10  Authors: michael bloom, carlos barria
Keywords: news, cnbc, companies, street, drama, wall, china, war, expect, trump, tariffs, potential, market, trade, sp, marketthe, thinks, unfolding, bank, deal, heres


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Stock market on edge as traders wait to see if Trump hikes tariffs

U.S. equity futures were little changed Thursday as traders awaited a midnight deadline for tariffs to increase. Stock futures opened slightly lower, with S&P futures contracts down 0.1%. President Donald Trump set a 12:01 ET deadline to slap higher tariffs on $200 billion worth of Chinese goods. Hours before the meeting Thursday, the president said tariffs are an “excellent” alternative to a trade deal with China. “What concerns me the most is, even if we do get a trade deal — which I think we


U.S. equity futures were little changed Thursday as traders awaited a midnight deadline for tariffs to increase. Stock futures opened slightly lower, with S&P futures contracts down 0.1%. President Donald Trump set a 12:01 ET deadline to slap higher tariffs on $200 billion worth of Chinese goods. Hours before the meeting Thursday, the president said tariffs are an “excellent” alternative to a trade deal with China. “What concerns me the most is, even if we do get a trade deal — which I think we
Stock market on edge as traders wait to see if Trump hikes tariffs Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-09  Authors: kate rooney, drew angerer, getty images
Keywords: news, cnbc, companies, week, hikes, trade, president, trump, tariffs, market, edge, futures, deadline, sp, wait, deal, tariff, white, stock, traders


Stock market on edge as traders wait to see if Trump hikes tariffs

U.S. equity futures were little changed Thursday as traders awaited a midnight deadline for tariffs to increase.

Stock futures opened slightly lower, with S&P futures contracts down 0.1%. Dow and Nasdaq futures both fell 0.12%.

China’s Vice Premier Liu He is meeting with top U.S. trade officials Thursday evening in Washington, just hours before the new tariffs are set to go into effect. President Donald Trump set a 12:01 ET deadline to slap higher tariffs on $200 billion worth of Chinese goods. Trump later suggested that the White House could reverse that decision, based on progress in negotiations.

Hours before the meeting Thursday, the president said tariffs are an “excellent” alternative to a trade deal with China.

Peter Boockvar, chief investment officer of Bleakley Advisory Group, said the market reaction will be extreme in either direction, depending on the outcome of Thursday night’s dinner.

“[Friday] is very binary. If you get a deal we’re going to rally — if you don’t, we’re going to take a really nice hit to the downside,” Boockvar said.

Boockvar is predicting an extension of talks and a delay by the White House.

“I understand what they’re trying to do by putting China’s feet to the fire. But I have to believe that they’ll extend the talks and they’ll delay the tariffs,” Boockvar said. “The president will talk tough, and we’ll get a relief rally tomorrow.”

Stocks extended this week’s extreme sell-off on Thursday. The Dow Jones Industrial Average has fallen more than 650 points this week, while the S&P 500 has lost about 2.5% following the president’s Sunday tweet threatening tariff hikes.

On Monday, stocks shook off the president’s weekend tweet as a mere negotiation tactic. But tougher rhetoric by top U.S. trade representative Robert Lighthizer weighed on major indexes. The White House set a Friday deadline to strike a deal before existing tariffs increase from 10% to 25%.

Markets again seesawed after the president said it was possible to get a trade deal with China this week. The Dow fell nearly 450 points at its intraday low on Thursday before cutting losses and ending the day just 138 points down.

Dave Lafferty, chief market strategist at Natixis Investment Managers, said any positive market reaction is still likely to be underwhelming.

“This is the new normal for U.S.-China trade relations — it’s almost become trade policy by tariff threat,” Lafferty said. “What concerns me the most is, even if we do get a trade deal — which I think we will — the market’s positive reaction will be fleeting.”

Still, traders are in a wait-and-see mode.

“The markets are ruled by the news headlines, and at this time, no one can guess which way the president or China is going to go,” said Chris Rupkey, chief financial economist at MUFG Union Bank. Rupkey said investors are “underestimating” U.S. economic damage if tariffs increase permanently.

“Markets have discounted a lot of bad news, but they haven’t discounted a recession as a result of the trade war escalation with China,” he said.

The Cboe Volatility Index, a measure of the 30-day implied volatility of the S&P 500 that’s commonly known as Wall Street’s “fear gauge,” hit its highest level since Jan. 4 on Thursday.

Goldman Sachs assured its clients that even if the tariff hike is implemented at the deadline, there’s room for some sort of deal.

“We note that details in the notice implementing the tariff hike indicate that exports that have already left Chinese ports before May 10 will not be subject to the increase,” Goldman economist Jan Hatzius said. “This creates an unofficial window, potentially lasting a couple of weeks, in which negotiations can continue and generates a ‘soft’ deadline to reach a deal.”

Others are less hopeful. In a note to clients, Cowen Managing Director and Washington strategist Chris Krueger highlighted Trump’s rally Wednesday night in Florida, his tweets over the week, and a comment Thursday that there was an “alternative” to a deal. Krueger said it’s “hard to not be more pessimistic on the U.S.-China narrative, i.e. The Return of Tariff Man.”

“Many are still optimistic tariffs can be avoided one minute past midnight (we are not),” Krueger said.

— CNBC’s Fred Imbert, Yun Li and Michael Bloom contributed reporting.


Company: cnbc, Activity: cnbc, Date: 2019-05-09  Authors: kate rooney, drew angerer, getty images
Keywords: news, cnbc, companies, week, hikes, trade, president, trump, tariffs, market, edge, futures, deadline, sp, wait, deal, tariff, white, stock, traders


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US companies are preparing for pain ahead of tariff hike: ‘I can’t sit here and cry’

Those tariffs, which the administration first implemented in 2018, are set to jump to 25% from 10% Friday morning. The taxes impact a wide variety of goods, ranging from pumps and turbines to electrical and computer components. Traders punished equities in turn, sending the Dow Jones Industrial Average down more than 650 points so far this week. The broad S&P 500 index was down about 2.5% week to date at the time this article was published. I think the issue really boils to — I think both partie


Those tariffs, which the administration first implemented in 2018, are set to jump to 25% from 10% Friday morning. The taxes impact a wide variety of goods, ranging from pumps and turbines to electrical and computer components. Traders punished equities in turn, sending the Dow Jones Industrial Average down more than 650 points so far this week. The broad S&P 500 index was down about 2.5% week to date at the time this article was published. I think the issue really boils to — I think both partie
US companies are preparing for pain ahead of tariff hike: ‘I can’t sit here and cry’ Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-09  Authors: thomas franck, timothy aeppel, luke sharrett, bloomberg, getty images
Keywords: news, cnbc, companies, week, pain, ahead, price, companies, cry, trump, trade, stanley, preparing, cant, tariffs, wide, sp, think, sit, tariff, took, hike


US companies are preparing for pain ahead of tariff hike: 'I can't sit here and cry'

In a tweet that took many on Wall Street off guard, Trump said Sunday the U.S. would increase levies on $200 billion of Chinese imports starting Friday. Those tariffs, which the administration first implemented in 2018, are set to jump to 25% from 10% Friday morning.

The taxes impact a wide variety of goods, ranging from pumps and turbines to electrical and computer components.

The announcement stunned many investors, who’d expected the U.S.-China trade deliberation to finish on a positive note this week after months of tamer dialogue. Traders punished equities in turn, sending the Dow Jones Industrial Average down more than 650 points so far this week.

The broad S&P 500 index was down about 2.5% week to date at the time this article was published.

The week’s losses — currently the worst since the 2018 Christmastime plunge — were likely the impetus for a number of comments by and questions for a slew of S&P 500 companies that reported financial results this week. While many CEOs took the opportunity to explain to shareholders the plans to soften the blow on their post-earnings conference calls, others were more blunt.

The trade disputes are “something we have to manage. I can’t sit here and cry and hold my breath. I’ve got to deal with them,” Emerson Electric Chairman and CEO David Farr said Tuesday on his company’s earnings conference call. “I still believe we’ll get a deal done. I think the issue really boils to — I think both parties are testing each leader on the give and take.”

“I’m glad to hear they are going to go ahead and meet this week. But I think this is going to go back and forth a couple more times,” he added.

Emerson Electric, which manufactures products and provides engineering services for a wide range of industries, said its global manufacturing end markets saw slower growth in part thanks to inventory rebalancing in the U.S. from last year’s tariff impacts and price increases.

Toolmakers Stanley Black & Decker and Snap-On said they’re taking steps to ease the pain of higher supply costs as a result of the Trump administration’s tariffs. Stanley Black & Decker CEO James Loree said his company’s been raising prices for consumers to help offset steeper input expenses.

“When you finally add it all up, I mean, the price recovery against the tariffs only amounted to about 40%, or between 40% and 50%,” he said on April 24. “So there was a big chunk of inflation-related cost that was not covered by the price as well as some of the tariffs.”


Company: cnbc, Activity: cnbc, Date: 2019-05-09  Authors: thomas franck, timothy aeppel, luke sharrett, bloomberg, getty images
Keywords: news, cnbc, companies, week, pain, ahead, price, companies, cry, trump, trade, stanley, preparing, cant, tariffs, wide, sp, think, sit, tariff, took, hike


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Markets are worrying about slower global growth again

Higher tariffs and the absence of a trade deal will force investors to lower estimates for global GDP, global earnings growth and the earnings multiple associated with higher growth. Lower global growth impacts the value of all companies. The market will assign a higher multiple to the markets if global growth and earnings are expanding. It will assign a lower multiple if growth and earnings are contracting. With no trade deal, and much higher tariffs, global growth will clearly be lower and the


Higher tariffs and the absence of a trade deal will force investors to lower estimates for global GDP, global earnings growth and the earnings multiple associated with higher growth. Lower global growth impacts the value of all companies. The market will assign a higher multiple to the markets if global growth and earnings are expanding. It will assign a lower multiple if growth and earnings are contracting. With no trade deal, and much higher tariffs, global growth will clearly be lower and the
Markets are worrying about slower global growth again Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-08  Authors: bob pisani
Keywords: news, cnbc, companies, trade, slower, sp, market, global, markets, multiple, earnings, deal, lower, growth, worrying


Markets are worrying about slower global growth again

Traders work on the floor at the closing bell at the New York Stock Exchange.

The markets have woken up to two facts: The odds of a tariff increase on Friday are much higher than the market had estimated and stocks will be dramatically overvalued if this happens.

The market is just off historic highs amid positive sentiment around four factors: the Fed pivot, a trade deal getting done, China’s stimulus program that is creating the perception China’s economy is bottoming, and a strong U.S. economy.

Higher tariffs and the absence of a trade deal will force investors to lower estimates for global GDP, global earnings growth and the earnings multiple associated with higher growth. This is why stocks like Molson Coors, Conagra Brands, Colgate-Palmolive and Kraft Heinz — all of which have little or no direct revenue exposure to China — are dropping along with those that do, like semiconductors, industrials and retailers.

Lower global growth impacts the value of all companies.

“This is a much broader deal than just who has revenue exposure to China, or who imports from China,” said Art Cashin, UBS’ floor director at the New York Stock Exchange.

A lower multiple is a particular problem. Large indexes like the S&P 500 trade off a multiple of forward earnings expectations.

The market will assign a higher multiple to the markets if global growth and earnings are expanding. It will assign a lower multiple if growth and earnings are contracting.

A typical multiple for the S&P 500 is 15 to 16 times forward earnings (the next four quarters). Refinitiv estimates the S&P will earn $171 per share in the next four quarters.

With the S&P at 2,940 a few days ago, the index was trading at a historically high multiple of about 17.2 (2,940/$171 = 17.2) at the start of May because of the Fed pivot to lower rates, a bottom in China’s economy and the prospect of a trade deal getting done — all positives.

With no trade deal, and much higher tariffs, global growth will clearly be lower and the markets are assigning a lower multiple to the markets, but how much is still not clear. If the S&P gets assigned a more reasonable multiple of 15.5 (roughly the historic average), the S&P could quickly drop to the 2,650 range (2,650/$171 = 15.5).

And what about that amazing rally, when the Dow rose 165 points in the last 15 minutes of trading Tuesday?

“Be wary of overnight tweets,” Cashin quipped, implying that President Donald Trump could just as easily issue a tweet that would move the market again.


Company: cnbc, Activity: cnbc, Date: 2019-05-08  Authors: bob pisani
Keywords: news, cnbc, companies, trade, slower, sp, market, global, markets, multiple, earnings, deal, lower, growth, worrying


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Stock futures cut losses after Trump tweets that China is coming this week to make a deal

U.S. stock index futures pared their losses after President Trump said China is coming this week to make a deal in a tweet. Dow futures fell 55 points, paring earlier losses and indicating a lower open of about 13 points. Futures on the S&P 500 were down about 0.2%. The Dow has lost nearly 540 points this week amid the trade dispute, while the S&P 500 and Nasdaq are down more than 2% after both hitting all-time highs last week. Data released Wednesday morning in China suggested that its trade su


U.S. stock index futures pared their losses after President Trump said China is coming this week to make a deal in a tweet. Dow futures fell 55 points, paring earlier losses and indicating a lower open of about 13 points. Futures on the S&P 500 were down about 0.2%. The Dow has lost nearly 540 points this week amid the trade dispute, while the S&P 500 and Nasdaq are down more than 2% after both hitting all-time highs last week. Data released Wednesday morning in China suggested that its trade su
Stock futures cut losses after Trump tweets that China is coming this week to make a deal Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-08  Authors: yun li silvia amaro, yun li, silvia amaro
Keywords: news, cnbc, companies, trade, week, cut, china, losses, trump, stock, futures, tariffs, global, coming, earnings, tweets, deal, points, sp


Stock futures cut losses after Trump tweets that China is coming this week to make a deal

U.S. stock index futures pared their losses after President Trump said China is coming this week to make a deal in a tweet.

Dow futures fell 55 points, paring earlier losses and indicating a lower open of about 13 points. Futures on the S&P 500 were down about 0.2%. Nasdaq was also set to open lower.

Dow futures were down more than 100 points Wednesday morning on fears the U.S. and China would be unable to resolve a dispute over a proposed trade agreement before new tariffs threatened by President Donald Trump are implemented Friday. Chinese trade officials backtracked on key aspects of a trade deal draft, undercutting hopes that the Chinese delegation led by Vice Premier Liu He this week could salvage the deal, according to a Reuters report.

“Stocks are betting on a rebound in the global economy in coming quarters … If we get higher tariffs this week and talks break down between the U.S. and China, you can kiss that hope for [a] global economic rebound goodbye,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group, in an email.

President Trump said in a Twitter post Sunday the U.S. would hike tariffs on Chinese goods as soon as Friday, which sparked a global sell-off. The Dow plunged more than 470 points on Tuesday, its biggest decline since January 3, as traders realized Trump’s threat was not just a negotiation tactic after U.S. Trade Representative Robert Lighthizer confirmed the higher levies are coming this week.

The Dow has lost nearly 540 points this week amid the trade dispute, while the S&P 500 and Nasdaq are down more than 2% after both hitting all-time highs last week.

Data released Wednesday morning in China suggested that its trade surplus in April stood at $13.84 billion, well below expectations. However, its trade surplus with the U.S. rose to $21.01 billion in April from $20.5 billion in March.

Investors are also monitoring corporate earnings. Honda Motor, Toyota Motors, The New York Times, and Wendy’s will report their latest results before the bell. Disney and Fox will report after the closing bell.

So far, 88% of the S&P 500 companies have reported their first-quarter earnings. Earnings are beating by 6.7%, with 73% of companies exceeding their bottom-line estimates, according to Credit Suisse.


Company: cnbc, Activity: cnbc, Date: 2019-05-08  Authors: yun li silvia amaro, yun li, silvia amaro
Keywords: news, cnbc, companies, trade, week, cut, china, losses, trump, stock, futures, tariffs, global, coming, earnings, tweets, deal, points, sp


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Dow drops 470 points on growing trade-war threat, biggest decline since early January

The Dow Jones Industrial Average fell 473.39 points, or 1.79%, to 25,965.09 after plunging as much as 648.77 points at its low of the day, while the S&P 500 dropped 1.65% to 2,884.05. All 30 of Dow components fell and all 11 S&P sectors traded lower in the broad sell-off. Lighthizer made his remarks after President Donald Trump tweeted he would raise current tariffs 10% on $200 billion of Chinese goods to 25% on Friday. He also threatened to impose an extra 25% levy on another $325 billion of Ch


The Dow Jones Industrial Average fell 473.39 points, or 1.79%, to 25,965.09 after plunging as much as 648.77 points at its low of the day, while the S&P 500 dropped 1.65% to 2,884.05. All 30 of Dow components fell and all 11 S&P sectors traded lower in the broad sell-off. Lighthizer made his remarks after President Donald Trump tweeted he would raise current tariffs 10% on $200 billion of Chinese goods to 25% on Friday. He also threatened to impose an extra 25% levy on another $325 billion of Ch
Dow drops 470 points on growing trade-war threat, biggest decline since early January Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-07  Authors: fred imbert yun li, fred imbert, yun li
Keywords: news, cnbc, companies, threat, trade, tariffs, think, dropped, dow, 470, tradewar, biggest, goods, decline, early, chinese, drops, growing, points, sp, fell


Dow drops 470 points on growing trade-war threat, biggest decline since early January

Stocks fell sharply on Tuesday after a top U.S. trade official indicated that higher tariffs on Chinese goods are coming later this week, disappointing traders who hoped President Donald Trump’s weekend tweet threat was just a negotiation tactic.

The Dow Jones Industrial Average fell 473.39 points, or 1.79%, to 25,965.09 after plunging as much as 648.77 points at its low of the day, while the S&P 500 dropped 1.65% to 2,884.05. It was the Dow’s biggest drop since January 3. The Nasdaq Composite dropped 1.96% to 7,963.76. All 30 of Dow components fell and all 11 S&P sectors traded lower in the broad sell-off.

Shares of trade bellwethers Caterpillar and Boeing fell 2.26% and 3.87%, respectively. Boeing also broke below its 200-day moving average for the first time since January. Chipmakers, especially vulnerable if China retaliates, led the tech sector lower as Nvidia dropped 3.75%. Apple also fell 2.7%.

U.S. Trade Representative Robert Lighthizer told reporters that the U.S. will increase levies on Chinese imports on Friday.

Lighthizer’s comments “further increased the likelihood of a tariff step up,” Keith Parker, a strategist at UBS, said in a note. A full-blown trade war would shave off 45 basis points from global economic growth, while China’s GDP would take a hit of between 1.2% and 1.5%.

“We still see a trade war as low probability given the next tranche of tariffs would hit US consumer goods, but nevertheless it would have a big negative impact,” he said.

Lighthizer made his remarks after President Donald Trump tweeted he would raise current tariffs 10% on $200 billion of Chinese goods to 25% on Friday. He also threatened to impose an extra 25% levy on another $325 billion of Chinese goods “shortly.”

Trump’s tweets initially sent the market reeling on Monday. The Dow fell as much as 471 points while the Nasdaq dropped 2% at one point. However, equities rebounded to close well off their lows on news that a Chinese delegation would come to Washington for talks and as traders bet that Trump’s tweet was just bluffing.

But Lighthizer’s comments dashed those hopes. The selling on Tuesday accelerated after the Dow broke through Monday’s lows.

The Cboe Volatility Index, a measure of the 30-day implied volatility of the S&P 500 known as the “VIX” or the “fear gauge,” hit a fresh high of 21.09 on Tuesday, its highest level since January 22.

“I think this is a big masquerade by the administration. I think they’re preparing the market for the worst-case scenario but a trade deal is probably going to happen,” said Peter Cardillo, chief market economist at Spartan Capital Securities. “I still think we’ll get some sort of positive announcement on Friday.”


Company: cnbc, Activity: cnbc, Date: 2019-05-07  Authors: fred imbert yun li, fred imbert, yun li
Keywords: news, cnbc, companies, threat, trade, tariffs, think, dropped, dow, 470, tradewar, biggest, goods, decline, early, chinese, drops, growing, points, sp, fell


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Trade war fears are crushing stocks, and sell-off could keep going if there is no deal by Friday

Stocks plunged and bonds rose in a safety trade Tuesday, after the Trump administration set the clock ticking on a 12:01 a.m. Analysts said the threat of new tariffs puts assumptions about the market at risk, including the expectations for 3% earnings growth this year. Global equity markets could also take a hit, as global growth would expected to slowdown on another round of tariffs. “If we have the increase from 10% to 25%, that would lower Chinese growth by a half a percentage point, and glob


Stocks plunged and bonds rose in a safety trade Tuesday, after the Trump administration set the clock ticking on a 12:01 a.m. Analysts said the threat of new tariffs puts assumptions about the market at risk, including the expectations for 3% earnings growth this year. Global equity markets could also take a hit, as global growth would expected to slowdown on another round of tariffs. “If we have the increase from 10% to 25%, that would lower Chinese growth by a half a percentage point, and glob
Trade war fears are crushing stocks, and sell-off could keep going if there is no deal by Friday Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-05-07  Authors: patti domm
Keywords: news, cnbc, companies, trade, tariffs, selloff, trump, deal, war, global, earnings, fears, chinese, stocks, come, crushing, going, growth, sp


Trade war fears are crushing stocks, and sell-off could keep going if there is no deal by Friday

Traders work on the floor of the New York Stock Exchange as the Federal Reserve Board Chairman Jerome Powell holds a news conference on December 19, 2018 in New York City. Spencer Platt | Getty Images News | Getty Images

Investors are worried the U.S. and China may not find enough common ground to head off a new round of tariffs later this week that could bite into global growth, squeeze profit margins and drive down stock prices. Trade negotiators are scheduled to meet this week in Washington, but recent tensions make it less likely a deal will be agreed to before the Trump administration unleashes a new round of tariffs. Analysts say a deal is still possible, but the risks have risen that there will be more tariffs before a deal can be agreed, and it could then take a lot longer than expected for an agreement to be hammered out.

Stocks plunged and bonds rose in a safety trade Tuesday, after the Trump administration set the clock ticking on a 12:01 a.m. ET Friday deadline for raising tariffs to 25% on $200 billion in Chinese goods. Trump administration officials said they still expect to meet with a Chinese trade delegation this week, but at a media briefing late Monday they said their Chinese counterparts reneged on some key areas of agreement in trade talks. The Dow fell more than 473 points to 25,965, and the S&P 500 was off 48 points at 2,884. “It all depends on what happens Friday. Traders were not expecting this. The market is trying to discount it in case tariffs get reinstated,” said Scott Redler, partner with T3live.com. “This is a curve ball, unexpected scenario.” With the threat of tariffs, analysts say many of Wall Street’s assumption for profits and growth would have to be tossed —suggesting that stocks could be too richly priced near recent highs. The forward price-to-earnings ratio on the S&P 500 was at 17 times earnings expectations. “That has to come down because growth has to come down…A good part of what went on in this market was predicated on a deal getting done in the first place. If that’s not the case, we have to start taking [earnings] estimates down,” said Art Hogan, National Securities chief market strategist. Keith Parker, chief U.S. equities strategist at UBS, said the hit to S&P 500 earnings would be 2% or greater, if the 10% tariffs on $200 billion in Chinese goods are raised to 25%. Parker said earnings would be hit by 7% if there was a full blown trade war, while the S&P 500 could trade in a range of 600 points on different scenarios of escalation of trade wars to de-escalation. The S&P is now near the top of the range, he said. “We think the most likely path is the deal. But escalation risks have risen and the growth backdrop is bit better so [investors should be] selectively staying involved in cyclicals and look for ways to hedge,” said Parker. “The S&P is probably trading much more in line with a status quo or some form of a deal. I would say it’s not pricing that trade war scenario.” The seeming divide between Chinese officials and the Trump administration added to concerns, after week’s of positive commentary from both sides. Hogan said China’s comments are problematic and could indicate the two sides are far apart. “They’re not going to back down from the parts of the deal they want. They don’t want to have a full account of the deal made public,” he said.

But at the same time, leaders in Washington and Beijing may feel like they have more leverage in the negotiations. China’s recent data has shown its economy is stabilizing after months of fiscal and monetary stimulus. The Trump administration too must be feeling upbeat after a strong U.S. jobs report and higher stock prices. Analysts said the threat of new tariffs puts assumptions about the market at risk, including the expectations for 3% earnings growth this year. Earnings in the first quarter grew at 1.2%, much better than earlier estimates for a decline, and second quarter S&P 500 earnings growth is expected at 1.5%, according to Refinitiv. On Tuesday, stocks reversed the pattern of Monday, where the worst losses were in the early morning as markets reacted to President Donald Trump’s Sunday afternoon tweets threatening more tariffs. As the day went on, stocks shook off losses as traders took the president’s threats as more a bargaining ploy by the president. Global equity markets could also take a hit, as global growth would expected to slowdown on another round of tariffs. “If we have the increase from 10% to 25%, that would lower Chinese growth by a half a percentage point, and global growth by 0.2 of a percentage point,” said Cesar Rojas, global economist at Citigroup. The impact on U.S. growth would be less than a tenth of a percentage point. “I think that we will get a deal,” said Rojas. “I’m still hopeful there will be an announcement that tariffs will not increase, and that they will come to an agreement…If that’s not the case, and there is a tariff increase on Friday , I will change my base case to having an escalation of trade tensions.” Rojas said if that’s the case, then a deal might be a much longer way off. China might not come back to the table in a serious way, until after it felt the pain of tariffs. The U.S. would also be hit by Chinese tariffs, and that would also come as U.S. growth was already slowing down from last year’s level.


Company: cnbc, Activity: cnbc, Date: 2019-05-07  Authors: patti domm
Keywords: news, cnbc, companies, trade, tariffs, selloff, trump, deal, war, global, earnings, fears, chinese, stocks, come, crushing, going, growth, sp


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