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Every Trade Wrinkle Is More Punishing Than Before: Taking Stock

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Trade Risks Can Hold Back Accelerated GDP Growth, Berenberg Says

Over the past week, we transitioned from a market that appeared to have buyers pouncing at every down-tick opportunity, no matter how much the ante was upped by either side in the U.S.-China trade tiff, to one that drifted lower as the tough talk was taken a bit more seriously.

The S&P 500 fell close to 1% last week, which isn’t too shabby considering 1) the focus turning squarely on trade vs the prior weeks where we had plenty of other distractions, and right at a time when the trade threats appear to be spiraling out of control, 2) brutal selloffs in China, which have put the country’s stock market on the brink of a bear market, 3) the Daimler profit warning that put the trade war fears into a more tangible perspective for the corporate world and is making people wonder who is next, 4) some disappointing economic data out of the U.S., like the Philly Fed and Flash PMIs, 5) a multitude of bullish to semi-bullish equity strategists waving the caution flag, 6) and the speed at which ran up almost a hundred points from the 2,700 mark in the early half of June.