Democratic presidential hopeful Congressman Tim Ryan isn’t impressed by President Donald Trump’s record-setting stock market.
“I just don’t think these metrics today such as unemployment and the stock market are reflective of the mass majority of the people in the United States. I hate to say that. I take no joy in that,” Ryan told Yahoo Finance when asked for his thoughts on the record-setting stock market that Trump so often touts.
“The reality is that people are squeezed. Millennials are squeezed. There is an affordable housing crisis in the country. There is a health care crisis in the country. There is a student loan crisis in the country. It’s affecting the mass majority of people,” Ryan added. “So, I think the president is digging his own grave when he goes around saying how great the economy is going because when you talk to average people, it’s not going well for them.
Nevertheless, those with money in the market enter the second half of trading in 2019 the same way they exited the first half: feeling darn good about themselves. The S&P 500 briefly surpassed its previous all-time intraday high earlier Monday, reaching as high as 2,977.93 on the session before retreating.
Those not on the beach this Fourth of July holiday week have run with news of a trade truce over the weekend between Trump and his Chinese counterpart Xi Jinping. Federated Chief Investment Officer Stephen Auth — who oversees more than $500 billion in assets — told Yahoo Finance he remains bullish on the markets. That’s despite ongoing uncertainty around global trade conditions and escalating political rhetoric as the 2020 election cycle ramps.
Stock market is detached from reality
But to Ryan’s point, the stock market’s latest surge seems completely detached from reality in many parts of the business community. The June ISM manufacturing index fell to 51.7 — the lowest level since October 2016. More worrisome than the headline number is that the new orders component —a proxy on future demand for manufacturers — fell to its weakest reading since December 2015.
“The key question now is whether the détente with China will be enough to lift business confidence or instead confidence remains tempered because of the existing tariffs and still the overhang threat of more if no deal takes place,” Bleakley Advisory Group Chief Investment Officer Peter Boockvar wrote to clients after the ISM report hit Monday.
The lackluster ISM reading joins a host of negative signals on the health of the U.S. economy in recent weeks. For example, companies from FedEx (FDX) to Nike (NKE) have reported mixed to disappointing earnings in large part to higher supply chain costs and cooling overseas demand.