Markets Drop as Trade Tensions, Political 'Mayhem' Weigh on Investors
*By Kavitha Shastry*
U.S. markets dropped Monday as questions over the future of Deputy Attorney General Rod Rosenstein added to investor concerns, which were already heightened by the onset of the latest round of tariffs on Chinese goods.
"The political environment seems to be mayhem on a daily basis, and we're just going to have to get used to that," said Jason Moser, analyst at The Motley Fool, in an interview on Cheddar Monday.
Reports emerged late in the morning that Rosenstein, who's overseeing Special Counsel Robert Mueller's investigation into Russian interference in the 2016 election, was resigning his post after a [bombshell report](https://www.nytimes.com/2018/09/21/us/politics/rod-rosenstein-wear-wire-25th-amendment.html) last week that he'd suggested recording conversations with President Donald Trump and recruiting cabinet members to call for his impeachment. Later stories suggested Rosenstein expected to be fired, and then that he would meet with the President Thursday to discuss the situation.
The news accelerated losses on the Dow Industrials, with the benchmark index falling nearly 200 points at the lows of the day.
Industrial stocks were among the biggest drags on the market ー DowDuPont ($DWDP), Caterpillar ($CAT), 3M ($MMM), and Boeing ($BA) were all down more than a percent. General Electric ($GE) saw shares fall to a nine-year low.
The weakness came as tariffs on $200 billion worth of Chinese goods ー and reciprocal duties on $60 billion worth of U.S. exports ー went into effect at midnight. In the days leading up to the deadline, many American companies, including Walmart ($WMT) and Target ($TGT), warned the taxes will force them to raise prices for U.S. consumers. Even companies like Apple ($AAPL), whose smartwatches, AirPods, and flagship iPhones were spared in this round, have spoken out against the levies.
"Ultimately tariffs do nothing but increase the cost of doing business with everyone," Moser said. "That's the more relevant issue as it pertains to housing, which is such a big cornerstone of our economy. That's something investors want to pay a little more attention to."
The National Association of Homebuilders estimates that a full $10 billion dollars worth of affected imports are in the renovation and construction space. Shares of companies like Toll Brothers ($TOL) and Lennar ($LEN) were both down more than 2 percent to start the week.
Markets also reacted Monday to a slew of multi-billion dollar mergers.
SiriusXM ($SIRI) said it was buying music-streaming pioneer Pandora Media ($P) for $3.5 billion, and fashion brand Michael Kors ($KORS) reportedly was nearing a deal to buy Versace for about $2 billion.
Comcast ($CMCSA) also won the long-running war for British broadcaster Sky, outbidding 21st Century Fox ($FOXA) with a $38.8 billion offer at auction over the weekend.
Some analysts wondered why the media giant was willing to pay such a high price for a legacy brand.
"This seems to be doubling down on the past," said BTIG analyst Rich Greenfield.
Comcast shares fell nearly 6 percent Monday, at one point posting their biggest percent loss since 2009.
For full interview [click here](https://cheddar.com/videos/why-siriusxm-purchase-of-pandora-is-not-a-big-surprise).
A rare magnum of Dom Pérignon Vintage 1961 champagne that was specially produced for the 1981 wedding of Prince Charles and Lady Diana has failed to sell during an auction. Danish auction house Bruun Rasmussen handled the bidding Thursday. The auction's house website lists the bottle as not sold. It was expected to fetch up to around $93,000. It is one of 12 bottles made to celebrate the royal wedding. Little was revealed about the seller. The auction house says the bids did not receive the desired minimum price.
The New York Times and President Donald Trump are fighting again. The news outlet said Wednesday it won't be deterred by Trump's “false and inflammatory language” from writing about the 79-year-old president's health. The Times has done a handful of stories on that topic recently, including an opinion column that said Trump is “starting to give President Joe Biden vibes.” In a Truth Social post, Trump said it might be treasonous for outlets like the Times to do “FAKE” reports about his health and "we should do something about it.” The Republican president already has a pending lawsuit against the newspaper for its past reports on his finances.
OpenAI has appointed Slack CEO Denise Dresser as its first chief of revenue. Dresser will oversee global revenue strategy and help businesses integrate AI into daily operations. OpenAI CEO Sam Altman recently emphasized improving ChatGPT, which now has over 800 million weekly users. Despite its success, OpenAI faces competition from companies like Google and concerns about profitability. The company earns money from premium ChatGPT subscriptions but hasn't ventured into advertising. Altman had recently announced delays in developing new products like AI agents and a personal assistant.
President Donald Trump says he will allow Nvidia to sell its H200 computer chip used in the development of artificial intelligence to “approved customers” in China. Trump said Monday on his social media site that he had informed China’s leader Xi Jinping and “President Xi responded positively!” There had been concerns about allowing advanced computer chips into China as it could help them to compete against the U.S. in building out AI capabilities. But there has also been a desire to develop the AI ecosystem with American companies such as chipmaker Nvidia.
U.S. sports betting is booming as NFL and college football fuel massive activity. BetMGM CEO Adam Greenblatt breaks down trends, growth, and what’s next.
President Donald Trump says a deal struck by Netflix last week to buy Warner Bros. Discovery “could be a problem” because of the size of the combined market share. The Republican president says he will be involved in the decision about whether federal regulators should approve the deal. Trump commented Sunday when he was asked about the deal as he walked the red carpet at the Kennedy Center Honors. The $72 billion deal would bring together two of the biggest players in television and film and potentially reshape the entertainment industry.
Disney's changes to a program for disabled visitors are facing challenges in federal court and through a shareholder proposal. The Disability Access Service program, which allows disabled visitors to skip long lines, was overhauled last year. Disney now mostly limits the program to those with developmental disabilities like autism who have difficulty waiting in lines. The changes have sparked criticism from some disability advocates. A shareholder proposal submitted by disability advocates calls for an independent review of Disney's disability policies. Disney plans to block this proposal, claiming it's misleading. It's the latest struggle by Disney to accommodate disabled visitors while stopping past abuses by some theme park guests.
