Market Watch: Full-scale Bear Market for Stocks is Among 3 Scenarios Citi Analysts Predict Amid Trade Tensions

June 11, 2019

Article by Mark DeCambre in Wall Street Journal Market Watch

With that thinking in mind, the Citi analysts anticipate a trio of market outcomes as tariff negotiations progress ahead of the G-20 meeting this month:

Trade deal at G-20

  • Stocks soar along with emerging markets as the outlook for the global economy improves, with the S&P 500 index jumping to around 2900

  • The 10-year Treasury note yields about 2.5%

  • Gold heads to around $1,300 an ounce from current levels

  • The U.S. dollar heads slightly lower but capped by lower expectations for Fed rate cuts

    No trade deal, nor Fed cut

  • Stocks enter a “full-scale bear market.” S&P 500 falls to 2,350

  • 10-year heads to 1.5% or lower

  • Gold jumps to $1,600

  • The dollar jumps against most currency rivals

    No trade deal but Fed cuts rates 3/4 of a percentage point

  • Stocks hit news highs, but not all stocks and sectors will perform well

  • 10-year Treasury note trades at a range of 1.75% to 2% and the yield curve steepens

  • Gold heads to $1,500

  • U.S. dollar weakens

To read this article in Wall Street Journal Market Watch in its entirety, click here.

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