One day after the the S&P500 bull market set a new duration record, at exactly 0.01 Washington Time on Thursday, the U.S. imposed tariffs of 25% on $16 billion worth of imports from China, sending the US dollar sharply higher across the board.
"The recent divergence in the performance of US Equities vs. the rest of the world is unprecedented in history. Given that this is such a rare occurrence, it suggests to us this is a market condition that will not persist."
It's relatively quiet week where the highlights will be the latest global PMIs, the Aug 23 US-China tariff deadline, the minutes from the last FOMC and ECB meetings and, of course, Jackson Hole looms at the end of the week.
The information technology sector accounts for 60% of the increase in S&P 500 profit margins over the past 20 years. Meanwhile firms ex tech, healthcare and consumer discretionary, have seen zero margin expansion this century.