Is Wall Street ignoring the potential for simmering trade conflicts with China to intensify, upending the stock market’s newfound buoyancy?
It may be hard to fathom that consternation tied to President Donald Trump’s hard-line stance with China, Europe and other major economies may bubble up into something more severe for investors after the Dow Jones Industrial AverageDJIA, +0.29% on Thursday booked its first record since Jan. 26, joining the S&P 500 index SPX, +0.09% and the Nasdaq Composite Index COMP, -0.20% both of which had already broken out of a lengthy downturn to notch their own records (as recently as Thursday for the S&P 500).
Although on some level the stock market’s climb to new heights represents a growing conviction about the U.S. economy, outweighing the threat that a Beijing-Washington trade fight could morph into the sort of a bellicosity that could disrupt global economic vitality, on another level a number of investors can’t shake a sense of unease about the current trajectory of tariff tensions.
Dec Mullarkey, managing director of investment strategy at Sun Life Investment Management, which manages some $47 billion, thinks the market is being too dismissive.
“I do think that the market right now is incredibly complacent,” Mullarkey said.