“Every trader has strengths and weakness. Some are good holders of winners, but may hold their losers a little too long. Others may cut their winners a little short, but are quick to take their losses. As long as you stick to your own style, you get the good and bad in your own approach.” — Michael Marcus

1. Venezuela’s Maduro Wins Re-Election — Venezuela’s Nicolas Maduro won a new six-year term in an election deemed illegitimate by the opposition and foreign governments, paving the way for heavier international sanctions. The economy has been in recession since 2014, with the bolivar currency down 99% in the past year and inflation at an annual 14,000%, according to the National Assembly.
2. Argentina Starts IMF Bailout Negotiations — with Argentina on the brink of a financial crisis, the IMF has formally begun bailout negotiations, without any objection from the Trump administration. Such measures rarely advance without U.S. support. The peso has fallen drastically against the dollar, while the nation has been dogged by persistent budget deficits, high inflation and trade imbalances.
3. China to Cut Import Duties On Cars — the easing of trade tensions between the U.S. and China is continuing, with the latter pledging to cut import tariffs on passenger vehicles to 15%, down from 25%. Import duties on car parts will be reduced to 6%. It comes after Washington froze its proposed Chinese tariffs and looked into lifting the ban on ZTE, while Beijing halted its probe into U.S. sorghum imports and restarted the review of the Qualcomm-NXP deal.
4. U.S. Launches Criminal Probe Into Crypto Manipulation — Bloomberg reports the DOJ is in the early stages of a criminal probe into whether traders are manipulating the price of bitcoin and other cryptocurrencies. It comes amid skepticism that exchanges are actively pursuing cheaters, wild price swings and a lack of regulations. Federal prosecutors are working with the CFTC, a financial regulator that oversees derivatives tied to bitcoin.
5. Trump Cancels Singapore Nuclear Summit with North Korean Leader Kim Jong Un — President Donald Trump canceled his historic nuclear summit with Kim Jong Un late last week, accusing North Korea of “tremendous anger and open hostility.” The news came as North Korea made a show of dismantling a nuclear test site, but also on the heels of some sharp words from the North Korean government about America denuclearization demands.
6. Peak Earnings Growth Follows by Recessions Statistics — courtesy of LPL Reseach (see table below), the average time the market proceeds to recession based on the last 12 earnings growth peaks since 1953 is about 4 years. If this hold true, we could expect a recession in mid-2022 which would make the current U.S. economic expansion the longest ever at 13 years old. Also note that the S&P 500 was up an average of 59% during these periods between the earnings growth peak and the start of the next recession.

The week ahead — Economic data from Econoday.com: