(Washington)

This weekend saw President Trump escalate his attacks on Robert Mueller’s special counsel investigation. Trump and his lawyers launched a public campaign to condemn the investigation which included Trump’s first tweets targeting Mueller by name. Trump tweeted that the investigation “should never have been started in that there was no collusion and there was no crime”, saying that the Mueller investigation was being led by “hardened Democrats” intent on taking down the Republican president. Trump’s more aggressive stance than in previous months led to several warnings from senators on both sides of the aisle that he should not try to end the investigation.

FINSUM: One keeps wondering if some bombshell accusation is going to arise from this investigation or whether it will end up being a long waste of time.

(Frankfurt)

For investors looking for signs of bad things to come, this is a pretty strong one. US investors may need to focus overseas to see what’s coming, as Germany’s benchmark DAX index has just hit a “death cross”, or when the 50-day moving average falls below the 200-day moving average. This has only happened to the DAX four times in the last decade, and in all of the instances the market fell at least a further ten percent after the cross.

FINSUM: So the DAX is partly down because of the country’s exposure to a trade war, but it could be a first manifestation of what is to come for global markets.

(Washington)

If the fiduciary rule was on its last legs before, it is really in trouble now. The DOL’s rule suffered its first significant court defeat this week. A US circuit court struck down the rule, saying it was too broad and “unreasonable”. The court found fault with the government’s broadened definition of what constitutes financial advice and who gives it. The loss means circuit courts have split on the fiduciary rule and it now appears likely the Supreme Court will take up the case.

FINSUM: This is a major blow to the fiduciary rule, and may help usher an even quicker departure for it. It will certainly give the DOL more ground to shift to a new rule co-drafted with the SEC.

(Washington)

Special counsel Robert Mueller may very well have just crossed one of Trump’s red lines in his investigation into the White House’s connections to Russia. Mueller has just subpoenaed the Trump organization. The Trump organization has been voluntarily giving the special counsel documents to assist with its investigation, but now faces an official subpoena. The tactic mirrors the approach used by Mueller during his investigation into the White House itself. The story of the subpoena was first issued by the New York Times.

FINSUM: It will be interesting to see how sharply, if at all, Trump reacts to this move. Is this the action that moves him to try to end the investigation?

(Washington)

Stocks may do well after the midterm elections, but Barron’s is arguing that rise will be preceded by a fall in share pricing leading into the elections. The contention is based on two arguments which rely on historical trends for the market. One is that markets do well in the third year of a presidential cycle, and the other is that stocks tend to do poorly in the summer. All of that points to a market that is likely to start rallying in the Autumn, specifically November 1st, says Barron’s.

FINSUM: While Barron’s does point it out, it is very worthwhile to bear in mind that these types of calls are only as good as the actual catalysts one sees that could really drive them. In this case, the uncertainty over how the Republican party will fair in the midterms may be a key factor.