By Matthew Kerkhoff
China and the U.S. slapped $34 billion worth of levies on each other’s exports last Friday, and today the markets said, “yeah, whatever” and marched higher. The questions is, why?
Market moves often baffle investors, but this one shouldn’t. Fundamentals are strong, corporate profits appear to be rising nicely, the trade skirmish represents a tiny portion of overall GDP, and stocks have been punished for six-months straight. Add to that small incidentals such as the market’s P/E falling by about two handles, as well as these tariffs already being priced in, and you have the recipe for a nice rally.