As of about 4:00 AM Central, the US markets are poised to start about 1.5% in the red.
We have seen a lot of miracle closes in the waning days of 2018. This could be another one, but I doubt it.
The Wall Street Journal reports Stocks Open 2019 With a Tumble Over Weak Chinese Data.
In Asia, weak economic data sent markets lower. The China Caixin manufacturing purchasing managers index fell to 49.7 in December, according to data released Wednesday. That is the first time the sector has been in contraction territory—below 50—since May 2017.
Hong Kong’s Hang Seng Index led declines, falling 2.4% midday. The Shanghai Composite Index was off by 1.1% and Australia’s S&P/ASX was down 1.5%. Japanese stocks were closed for a public holiday.
This has little or nothing to do with weak Chinese data. Equities are horrendously overpriced and the US is headed for a recession.
Happy New Year
Mike “Mish” Shedlock
Mish, maybe you should have waited until the end of the session, when it all turned green. But there’s always Turnaround Tuesday!
Yes, surely corporate profits “have reached a permanently high plateau”.
S&P 500 trailing P/E is around 16, it’s really hard to make a case that’s overpriced, much less horrendously overpriced, based on current expectations. The bear case is banking on a recession, not valuation.
Not to worry. The “Pension Fairy” will make another miraculous appearance at 3:58 pm (or earlier) to ensure that almost everyone leaves the casino happy today.