‘Befuddling’ Signals Whipsaw Stock Traders in Trump's Trade War

Forgive stock investors for feeling whipsawed. They just endured one of the wildest weeks of the bull market only to see the S&P 500 end not far from where it started.

The rapidly escalating trade war bears the blame, sure, but that’s not going away anytime soon. What matters for financial markets is the impact on future growth, and equity traders looking for guidance often turn to Treasuries. The problem there is that bulls and bears can both find succor.

Stock skeptics look at yields that tumbled toward three-year lows and see a warning that the economy is doomed, no matter the trade war’s outcome. For bulls, the same bargain-bin rates make equities especially attractive when compared with earnings using what’s known as the Fed model.***

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