“The key to trading success is emotional discipline. If intelligence were the key, there would be a lot more people making money trading… I know this will sound like a cliche, but the single most important reason that people lose money in the financial markets is that they don’t cut their losses short.” — Victor Sperandeo

1. Trump’s Budget Proposal Features $8.6B for Wall, Increased Defense Spending — the White House proposed a $4.7T fiscal 2020 budget that called for cutting regular non-defense discretionary spending by 9%, while increasing defense spending and including $8.6B for a border wall. Under the blueprint, the budget doesn’t balance in 10 years and shows a $202B deficit in 2029, assuming economic growth at an average of 3% for the decade. The proposal is likely to be dismissed by Congress and increases the threat of another government shutdown in the fall.
2. Boeing Grounds Global 737 MAX Fleet — Boeing has decided to temporarily suspend its entire fleet of 737 MAX planes “out of an abundance of caution and in order to reassure the flying public of the aircraft’s safety.” The FAA reversed course and grounded the jet after evidence emerged showing a flight that crashed in Ethiopia may have experienced the same problem as a plane that went down five months ago off Indonesia. Analysts say the initial impact of the grounded Boeing (NYSE:BA) jets will be contained, but may escalate if the fleet is not permitted to fly for a longer period.
3. UK Parliament Rejects a Second Brexit Referendum — U.K. lawmakers voted to delay Britain’s departure from the EU, sending Theresa May back to Brussels to request an extension. Her pact with the trading bloc is also expected to be voted on in the House of Commons for a third time next week, after being soundly rejected twice. Parliament further blocked a motion yesterday seeking a second Brexit referendum, though Labour leader Jeremy Corbyn said his team is still working on plans for another public vote.
4. AAII’s Weekly Survey of Individual Investors — in the latest Bullish sentiment, it shows another drop in bullish sentiment. This comes following the first weekly decline that equities have seen so far in 2019. The percentage of investors expressing optimism dropped to 32.42% from 37.39% last week. The week prior to that was a recent high, and the highest since early November, at 41.63%.

Conversely, bearish sentiment rose to its highest level since the final days of January coming in at 31.06% versus 26.75% last week. Bearish sentiment has come well off of its lows of 20% only a couple of weeks ago. Where it currently sits is much more in line with its historic average of 30.5%.

5. Tesla Announced Model Y Event — Completing the EV lineup that Elon Musk has dubbed “S3XY,” Tesla (NASDAQ:TSLA) took the wraps off its Model Y, with prices starting at $39,000. The crossover is larger than the entry-level Model 3 but smaller than the Model X, Tesla’s full-size SUV. With a 0-to-60 mph acceleration time of 3.5 seconds and a standard range of 230 miles, the first Model Ys are due for release in fall 2020.

The week ahead — Economic data from Econoday.com: