SP500: The market turns into a mess as Wall Street lost confidence in Trump's handling of the economy

The S&P 500 took a 2.41% nose dive on Monday, sliding down over 3% intraday to retest the 600-day EMA at 5,111.49, after CNBC's survey showed that only 43% of Americans approved of Trump's handling of the economy. Investor confidence may also be hurt by the lack of progress on global trade, added CNBC.

American companies such as Boeing [BA], Tesla [TSLA], Apple [AAPL] and Nvidia [NVDA] appear to be the big losers in Trump's trade war, letting their foreign competitors gain an advantage in the global market.

To make matters worse, Trump is now ramping up attacks on Fed Chair Powell and demands that the Fed lower rates. Wall Street analysts warn about deeper selloffs of the financial markets if Trump fires Fed Chair Powell.

The U.S. GDP Q1 forecast by the Atlanta Fed is -2.2% as of April 17. Keep an eye on the 2Y treasury yield, it just broke its 600-day EMA. In the past 25 years, all three US recessions occurred after the 2Y treasury yield dropped below its 600-day EMA.

This note contained herein is our opinion and should not be construed as a recommendation to buy or sell. Click here to view the latest update!