U.S. companies are\nlooking outside of China for manufacturing in response to ongoing trade\ndisputes. Banks are turning to personal and business loans to drive revenue,\nand Netflix saw its first subscriber loss in Q2. How can these stories and\nothers impact the market? Read on for details.<\/p>\n\n\n\n
U.S. Manufacturers\nare Moving Operations Outside of China \u2013 <\/strong>U.S. corporations have been\nfeeling the effects of the ongoing trade dispute between the U.S. and China. We\nlearned this week that following the tariff increase to 25% in May, many\ncorporations have decided to shift supply chains from China to other countries\nin Southeast Asia. Popular U.S. brands like Crocs shoes, Yeti coolers, and\nGoPro cameras are looking to countries like Vietnam, India, and Malaysia to\nbuild new factories and fundamentally reshape global supply chains. Most\ncompanies undertaking this move have said that these supply chain moves will\nmost likely be permanent, as doing so involves substantially time and financial\ninvestment. This trend underscores the slowing growth numbers recently posted\nfrom China, which could play into slower than expected global growth rates for\n2019.1<\/sup> <\/p>\n\n\n\n Financials Post\nStrong Earnings on Consumer Lending \u2013 <\/strong>The yield curve is \u201cu-shaped,\u201d but\nfor banks it may as well be flat or inverted. With the 30-year U.S. Treasury\nBond at 2.57% and the 1-year U.S. Treasury Bond at 1.95%,2<\/sup> the net\ninterest margin for banks is tight. In these environments, one might reasonably\nexpect Financials not to post stellar earnings. But trends in consumer lending\nare driving quarterly profits higher at banks like JP Morgan, Wells Fargo, and\nCitigroup, which are reporting that consumers are taking advantage of low\ninterest rates by borrowing more and driving more business to consumer lending\ndivisions. As trading and investment bank fees stagnate or decline, banks are increasingly\nturning to personal and business loans to drive revenues.3<\/sup><\/p>\n\n\n\n ________________________________________________________________________<\/p>\n\n\n\n Set Yourself Up for Long-Term Investing Success<\/a><\/strong><\/p>\n\n\n\n Investing is emotional. A bull market can be as exhilarating\nas a bear market is terrifying (ask any investor who went through 2008). But in\nour view staying invested is key – since 1926, investors who remained in the\nmarket over the long-term came out ahead 99% of the time.4<\/sup><\/p>\n\n\n\n It\u2019s important to maintain perspective during rough periods\nso you don\u2019t overreact. If you have $500,000 or more to invest, get our free\nguide, How to Avoid Emotional Investing<\/em>. It provides our advice, based\non decades of experience, to help you navigate through turbulent times.<\/p>\n\n\n\n Download Our Guide, <\/a>How to Avoid Emotional Investing<\/a><\/em>.<\/a>5<\/a><\/sup><\/strong><\/p>\n\n\n\n ___________________________________________________________________________<\/p>\n\n\n\n The Fate of the\nUSMCA \u2013 <\/strong>There has not been much reporting recently on the \u2018new NAFTA,\u2019\nknown as the USMCA. Many people may even believe that the new trade deal is law\n\u2013 but it\u2019s not. All new trade deals must be ratified by Congress, which has yet\nto approve the new arrangements between the U.S., Mexico, and Canada. U.S.\nTrade Representative Robert Lighthizer is best known today for his work trying\nto arrive at a trade deal with China, but when he is not working with Chinese officials,\nhe spends time in the halls of Congress trying to sell the USMCA. Disagreements\nremain over enforcement provisions for the deal.6<\/sup> <\/p>\n\n\n\n Netflix Loses\nSubscribers in Q2 \u2013 Signal of a Broader Slowdown? \u2013 <\/strong>In an anecdotal (and\nearnings related) sign that the business cycle may be turning over, Netflix\nreported this week that its total number of subscribers actually declined <\/em>in Q2, the first time that\u2019s\nhappened in nearly a decade. Netflix said it lost 130,000 domestic subscribers\nin the quarter, which could be a sign of economic slowdown or evidence of\nlong-term growth challenges that face the company as competition grows fiercer\nfrom rivals like Hulu, Disney, Comcast, and Apple. Netflix remains king of the\nspace with 60.1 million U.S. subscribers and 91.5 million globally, but growing\npains could weigh on the company and the stock looking ahead.7<\/sup> <\/p>\n\n\n\n No matter how\nthese stories unfold, it is impossible to control the highs and lows of market.\nBut there are ways you can manage the highs and lows of your own emotions and\nstay focused on your long-term goals. <\/p>\n\n\n\n In our view, staying invested is key – since 1926, investors who remained in the market over the long-term\ncame out ahead 99% of the time.8<\/sup><\/strong><\/p>\n\n\n\n If you have\n$500,000 or more to invest, get our free guide, How To Avoid Emotional Investing<\/em>.9<\/sup> It provides our\nadvice, based on decades of experience, to help you navigate through turbulent\ntimes.<\/p>\n","protected":false},"excerpt":{"rendered":" Chinese trade dispute spurs exodus, banks profit off more lending, Netflix faces more competition <\/p>\n","protected":false},"author":3,"featured_media":7426,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[71,73],"tags":[],"class_list":["post-8122","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-private-client-group","category-steady-investors-week"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/8122","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=8122"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/8122\/revisions"}],"predecessor-version":[{"id":10734,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/8122\/revisions\/10734"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=8122"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=8122"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=8122"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}