Investors are seemingly returning to concern over important factors, including the US-China trade war, the weakening global economy and inverted Treasury yields, which may be a sign of a new recession.
US stock index futures started out higher in the pre-market session on Monday in response to reports that special counsel Robert Mueller only found little evidence that the 2016 presidential campaign of Donald Trump was connected with Russia, according to the attorney general William Barr. However, the positive trend did not last long, and prices began to retreat again due to renewed concerns about the global recession.
In other words, what should have been a bullish start for investors has unfortunately stalled. Shortly before the opening of the futures market, William Barr wrote in a letter to senior lawmakers, “The Special Counsel’s investigation did not find that the Trump campaign or anyone associated with it conspired or coordinated with Russia in its efforts to influence the 2016 U.S. presidential election.”
The White House responded to the report by saying that the results were a “complete exoneration of the President of the United States.”
For investors, Muller’s investigation represented a concern as it may have hindered Trump’s efforts to strengthen his policy by introducing additional tax cuts and easing corporate regulations. This might distract Trump’s attention as the US President tried to protect American business interests from China’s unfair business practices.
Senior US market analysts say the market will rebound anyway sooner or later. Overall, however, the investigation was a major concern for investors.
We have already seen the markets react to news regarding the pre-market opening. The news caused the markets to rise, and most likely we will not see any new developments related to the event when the market opens on Monday.
Instead, investors will most probably return to major concerns including the US-China trade war, the weakening global economy and inverted Treasury yields, which may signal a new recession on its way.