John Hancock: Weekly Market Recap Week Ended December 14th

Erratic movements

The latest week’s trading was characterized by big intraday swings in stock prices—an occurrence that has become increasingly common this year. The spread between the S&P 500’s daily high and low has exceeded 1% on 100 days so far this year, according to S&P Dow Jones Indices. That’s up from just 10 such instances in all of 2017, a year of unusually low volatility.

Trade progress

Concerns about the U.S.-China trade dispute eased after Chinese negotiators signaled their willingness to reduce tariffs on U.S. automobile imports and increase purchases of U.S. soybeans. However, it remained unclear whether the sides will reach a broader agreement prior to March 1, 2019, when further tariff increases could be implemented.

Growing pains

China’s industrial production growth rate fell to its lowest monthly level in nearly three years, while growth in the nation’s retail sales dropped to its lowest point in more than 15 years. In Europe, the European Central Bank cut its economic growth forecast.

Fed ahead

The U.S. Federal Reserve Board is widely expected to approve another increase in short-term interest rates when it concludes a two-day meeting on Wednesday. If the Fed decides on another quarter-point increase, it would be the fourth this year, boosting the federal funds rate to a target range of 2.25% to 2.50%.

Source: https://wmr.jhinvestments.com