Trump wrote on Twitter over the weekend that tariffs on $200 billion in Chinese goods could rise to 25%. He said that a 25% tariff will soon be assigned to a selection of $325 billion in presently untaxed goods.
The tweet sent the Dow Jones Industrial Average down sharply while the yield on the 10-year Treasury note dropped to 2.48% as investors flocked to the government-backed safe-haven. The 30-year Treasury yield — which mortgage rates are often pegged to — dropped to about 2.9%.
This was the classic flight to quality showing that the marketplace is still unsettled and remains brainwashed over trade and interest rates as factors that are important within the US share market. We are still in a consolidation pattern and that is not likely to come to an end until the ECM turns in 2020.