Furthermore, a decline in liquidity is amplifying moves, according to JPMorgan. Market depth in S&P 500 Index futures contracts recently plunged to record lows, Kolanovic said.
And there’s another factor exacerbating the picture, as well: President Donald Trump and his administration.
The White House has “given more than enough material (e.g. tweets, etc.) to be exploited by these actors in order to create an environment of investment uncertainty (e.g., on issues of global trade, oil, business decisions of individual companies, etc.),” the strategists wrote.
The president continues to tweet prolifically, but after posting Twitter messages about the stock market more than 35 times since his election, he’s gone mum about stocks as markets have gone south in the past month.
This article provided by Bloomberg News.