x
Breaking News
0

Seasonal Selloff Continues Amid Ongoing Trump Turmoil

By Colin CieszynskiMarket OverviewMay 18, 2017 09:09
ca.investing.com/analysis/seasonal-selloff-continues-amid-ongoing-trump-turmoil-200189441
Seasonal Selloff Continues Amid Ongoing Trump Turmoil
By Colin Cieszynski   |  May 18, 2017 09:09
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

It's not uncommon for stock markets to Starr sliding in the middle of May after news flow from Q1 earnings subsides. Since this year's seasonally strong period recieved an additional boost from a big Presidential honeymoon trade, the question had been what it would take to knock a teetering bull market over the edge.

Growing political uncertainty in the US combined with election results showing fears of political instability in Europe were overblown has sparked a major re-evaluation of political risk around the world. Capital has been leaving risk markets like stocks and the US dollar with some heading back to Europe, boosting EUR and GBP and some fleeing for defensive havens sending gold soaring.

Continuing on from yesterday's selloff in North America, overseas markets have been plunging overnight with the Nikkei and FTSE falling 1.3% and the Dax dropping 0.9%. US index futures continue to fall ‎dropping another 0.5% this morning.

Talk of impeachment in the past has been terrible for markets. The Watergate scandal that led to the resignation of President Nixon coincided with the 1973-74 Grandaddy Bear Market. Also, the 1998 mini bear market that saw the S&P lose 15% in three weeks occurred in the middle of the Lewinsky scandal and attempt to impeach President Clinton.

It remains to be seen how long the Russia investigation may continue as a big story. President Trump is heading out on the road to Saudi Arabia, Israel and Italy plus a G7 summit which may shift focus elsewhere. On the other hand, Comey has been invited to testify to Congress next week. Even if this somehow manages to blow over, it's still a prelude to the big budget battle looming for September that could lead to a government shutdown.

With a potentially volatile summer looming ahead, markets remain active, creating trading opportunities. A strong UK retail sales report, Falling US dollar and more polls giving Conservatives a huge lead with their party manifesto now out has ignited a big rally in GBP today, sending cable back above $1.3000. JPY and ‎gold continue to climb, while EUR has dropped back slightly after a rally.

CAD continues to struggle, still underperforming the weak greenback. A 1.8% drop in oil prices is dragging on the loonie. The possibility that President Trump could try to score a win in trade talks against Canada and Mexico to distract from his problems at home may also be having a negative impact on CAD.

Seasonal Selloff Continues Amid Ongoing Trump Turmoil
 

Related Articles

Seasonal Selloff Continues Amid Ongoing Trump Turmoil

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

 
Are you sure you want to delete this chart?
 
 
Replace the attached chart with a new chart ?
Post
Post also to:
1000
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
 
Replace the attached chart with a new chart ?
Post 1000
Please wait a minute before you try to comment again.
 
 
 
Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Add Chart to Comment
Disclaimer: DISCLAIMER: CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.