August 9th, 2019
The Dow plunged 767 points on Monday after China escalated its trade war with the U.S.
The Chinese government devalued its currency to fall below its 7-to-1 ratio with the US dollar for the first time in a decade. The weak yuan caused the market to take a drastic drop and sparked concerns that the U.S would retaliate with higher tariffs.
The world's two largest economies are each other's biggest trading partners. Nearly $700 billion in goods were sent between China and the United States in 2018 alone.
Trade talks have been ongoing and it is in both economies best interests to reach a deal. Markets could bounce back favorably once trade negotiations are resolved.
We believe market volatility is likely to persist and should be embraced, not feared. While it may get uncomfortable in the short-term, it is important to focus on the fundamentals and remember the importance of diversification during times like this.
We want to reassure you that we are monitoring the situation and we are available to answer your questions to determine if any adjustments should be made to your specific situation.
If you have questions or concerns, please feel free to contact us to discuss further.
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As our clients' most trusted advisor, the team at Covenant Wealth Strategies is a catalyst; striving to build financial security, see dreams fulfilled, and create enduring legacies.