In a market as dull as this one has been lately, any headline about China trade or the Fed is sure to elicit a response. President Trump just provided comments on both and triggered a wave of selling.
Trump commented that there is still a 'way to go' on China and he could impose tariffs on another $325 billion. He also commented that President XI is the de facto head of the China central bank and is free to aggressively manage interest rates.
These comments aren't anything new or surprising but they do highlight the fact that a China trade deal won't happen soon and that Trump is very unhappy with Fed head Jerome Powell. It doesn't change anything but with the market already a little concerned that better retail numbers may make the Fed a bit more cautious.
The selling is picking up now but breadth is still in decent shape. I expect that there are some dip buyers lurking nearby and that they will act at the first hint of some stabilization.
From a technical standpoint some downside at this juncture may be what is needed to shake things up and create better trading conditions into earnings. This slowness of the action while the indices are perched near highs has been confusing and has caused overbought conditions to develop in places.
I have nothing new on my radar right now but am glad to see some movement in the indices although it is still quite limited.