From the Wall Street Journal:
When a trade war broke out between the world’s two largest economies in June, investors barely blinked. After the Federal Reserve raised interest rates — often a reason for investors to sell stocks — the markets kept climbing. As some of the world’s largest economies began to slow down, American markets largely shrugged it off.
Last week, elements of all of those combined to drive the S&P 500-stock index down by 4.6%, its worst weekly drop since March and one marked by stomach-churning price swings. Stocks are now down 1.5% this year.
More volatility could be in store, as investors assess the allegations by prosecutors that President Trump directed illegal payments to ward off a potential sex scandal, and the possibility that he sought to secretly do business in Russia during his 2016 campaign for the White House.
The arrest of a prominent Chinese technology executive, meanwhile, has added new strains to the relationship between Washington and Beijing, which face a March deadline to reach a trade deal. On Sunday, China summoned the American ambassador in Beijing to protest the arrest, while Robert Lighthizer, who is leading the trade talks with China, said he considered March 1 to be a “a hard deadline” for the negotiations…