Monday Market Momentum – Lost Due to Trade Setback

Trade off!

Over the weekend we had a little setback in the trade negotiations as Trump said he has NOT agreed to remove tariffs on Chinese goods and that news came after Chinese markets had closed on Friday so this morning,  the Shanghai Composite wwas down 1.8% and Hong Kong's Hang Seng dropped 2.6%.

Also in Hong Kong, tensions escalated even further this morning as the police opened fire on protesters while Hong Kong's Governor said the Govevernment won't "yield to violence."  A man was also "set on fire" – apparently by the protesters.  Around midday, crowds of office workers were seen fleeing clouds of tear gas filling the streets. Some rushed into the lobbies of buildings to seek shelter and poured water over their eyes to relieve the pain. Police made a number of arrests as people chanted abuse at them.  

Combine that level of chaos in a densely packed city AND have the market start to collapse – that's a recipe for disaster and one of the main reasons we've been leary about re-committing our capital to the market.  Chinese protests, however, also gave us our shorting premise on Booking.com (BKNG), as we discussed last week in our Short-Term Portfolio Review.  We felt the earnings would be impacted by the protests – which have been going on all quarter and we got a nice dip in BKNG on earnings, leading to a massive $18,872 (19%) portfolio gain in just two days – your welcome!  

 

 

IN PROGRESS