Recent revelations from Apple showed that sales of its iPhone products were way slower in China than many had anticipated. The poor sales data along with reduced guidance from the company sent its stock down by nearly 10% on Thursday as the Dow Jones Industrial Average shed over 600 points.
Bad news from Apple was not the only issue weighing down the markets, either. A recent string of manufacturing data has clearly shown a slowdown in activity. After the Apple announcement on Thursday, the latest reading on ISM manufacturing sank to the lowest level in two years.
Anyone that does not believe that the ongoing trade war with China is influencing both countries needs to take another look. Chinese economic data has also been turning sour in recent months, and the sharp drop-off in iPhone sales could be a good indication that the trade war is now having a major effect on U.S. companies.
This could potentially force both countries to return to the negotiating table eager to make a deal. If no viable deal is reached, and soon, the world’s two largest economies may continue to slow, increasing the risk of recession along the way.
Stock investors do not appear to be very confident at this point. Although the recent selling and volatility in equity markets has been severe, the market does not seem to have reached a capitulation point yet. That could mean more declines are on the way.
Regardless of whether a trade deal is reached soon or not, markets also have plenty of other issues to worry about. Uncertainty about the Fed’s plans, a democratic House taking control and the seemingly rising recession risks to name a few.
The current economic and geopolitical landscape may present challenges that could overwhelm markets. Stocks may not just continue to decline but could potentially enter a long period of lower prices and little upside.
As this “new normal” takes shape, investors will be forced to seek out alternatives. By that time, however, many alternative asset classes will have already taken off. That is why it is so important to act now before things get even worse.
Given the current economic and geopolitical risks, hard assets like physical gold may potentially be a great bet. The gold market could not only potentially outperform during the next major recession and stock bear market but may also provide an important hedge against rising inflation and a weaker dollar.
Adding physical gold to your portfolio has never been easier and perhaps never as important as right now. Simply pick up the phone and speak with an Advantage Gold account executive today about the potential benefits of gold and how this asset may play a key role in the years and decades ahead. Our account associates are here to answer any questions that you may have and can even show you to build a significant allocation in gold using an IRA account.
Don’t wait for the next major stock market crash or for higher inflation to take a bite out of your purchasing power. Explore your options for gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: advantage gold, apple, china, dow jones, gold, ISM manufacturing, trade war