The rise in stock prices is one of Donald Trump’s major achievements, according to the president. But Trump’s questionable economic and foreign policy decisions are changing the way investors look at the stock market. The pending trade war with China, and the Feds interest rates hikes, as well as Trump low-key feud with the European Union, will have an impact on the stock market in 2019, according to investment analysts. Those issues are what some investors call “bull market breakers.” But there are other bull market breakers in play right now. The big hedge fund investors worry about the tech titans more than they worry about those other important stock moving factors.
The tech industry was the catalyst for this long-running bull market. Google, Apple, Facebook, and Alphabet seemed invincible. But that perception is yesterday’s news. Amazon and Facebook stock values are down more than 20 percent. And Alphabet, Google’s parent company, and Apple’s stock recently dropped 10 percent from their market peak this year. In fact, the stock market gave up all its gains in October and November doesn’t look much better. Investors know the bear will be knocking down Wall Street’s door at some point. But if tech stocks don’t shake off their issues, the bear market might be Trump’s kryptonite.
Most investors know the stock market isn’t reacting to low unemployment, or the 28 percent third-quarter profits that the S&P 500 posted the way it normally does. Investors are more concerned with a downturn in the economies of China and Europe than those positive facts. China’s new consumer-spending economy could stall because of Trump’s trade war. And if Europe’s economy continues to feel the strain of Brexit, immigration overload, and the nationalist movement that some EU members embrace, the U.S. economy will feel the impact of this pending global recession, according to some economists.
According to James Bianco, the president of financial research firm, Bianco Research, there is a global slowdown underway. The U.S. economy will feel the impact of a global slowdown. And the bear market is one issue that will come out of that slowdown, according to Bianco. The other issue that has some investors running for the gold market is the downturn in the housing market. If that trend continues, and if tech stocks don’t bounce back after the holiday selling season, 2019 could be the year Trump tells the country the bear market is just fake news.