Markets Continuing to be Jittery—-11/12/2018

After a nice rally last week, the markets started to sell off again after the Fed meeting. I believe the reason is two fold:

1) Fed Chair Powell gave no indication that he will stop raising rates.

2) There is no trade deal with China

Regarding the first point, the market needs reassurance that the Fed will not keeping raising rates indefinitely. However, Chair Powell has given no hint that he will stop. The market would love to hear him say something as simple as, “the Fed will be data dependent regarding future interest rate hikes.” But, again, he hasn’t done that as of yet.

Regarding the second point, seemingly every other nation/organization has signed a new trade deal with the U.S. and/or given hints that they are working towards an agreement, except China. The market will not be fully settled until this is done. The largest players on the global economic stage are the U.S. and China and until there is an agreement on how business dealing will be done between those two, global market will remain volatile.