An increase in trading tensions was not enough to save stocks Friday.
Instead, the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite indexes all closed at record highs despite a hiccup in trade developments that helped propel S&P into a fifth straight week of gains.
Experts are still divided about what's next for stocks, especially given the apparent disagreement between the White House and the Chinese trade authorities over a potential rollback of tariffs.
Here are what three of them are looking at:
Margaret Patel, senior portfolio manager for the Wells Fargo Asset Management Multiple Asset Management team, said there are more important things to look at than the trade tip:
"I think trading is very small, affecting as far as corporate earnings or GDP ̵
Greg Boutle, US Head of Stock and Derivative Strategy at GDP Paribas, so in fact More Reduced Risks Than Upside Catalysts:
"The market has become much more optimistic in terms of trading and potentially customs rolls, so I actually see the risk from trading now more asymmetrical and more potentially to the disadvantage. … Similarly, with growth, the market – certainly when you look at revenue estimates – expects a strong rebound into next year and another quarter [s]. We have just seen the … downturns in terms of earnings growth in the companies, so again, I think the risk of these estimates is at a disadvantage, not the upside. "
Ben Morel, JP Morgan Asset Management, a global strategist at the firm's multisetting solution group, said that the overall design of the market appears to be gradually changing:
" For us, we have put a lot of emphasis on earnings and the fact that When you look into 2020, earnings expectations seem unrealistic. We haven't really changed that. I mean, the contours of earnings aren't that much better, and we just think we're in a situation where if you have stabilizing growth and lower recession risk, the markets will somehow see through the downgrade cycle that we expect to get through 2020. Of course , if you actually get a change in it, then if there is a significant change in our outlook – which is for a very slow, gradual acceleration in growth over the coming quarters back to the trend – if you actually get a bit of a surprise about it and revenue expectations their changes, that's when I think you're opening up to a new era of upside risk. We're not quite there yet, we're just less defensive. "