Photo: Reuters/Andrew Kelly

Everything went wrong with the US stock market today. Tech companies got clocked because the Facebook and Uber disasters of the past week point to huge vulnerabilities in the tech business model. Exporters like Boeing and Caterpillar got clocked because of Trump’s China tariffs. Financials got clocked because the fall in bond yields and flattening of the yield curve following the Federal Reserve’s nothing-burger of an Open Market Committee statement failed to impress the market.

That said, US stocks are well off their worst levels of the day. As Commerce Secretary Wilbur Ross told CNBC earlier today, the Trump Administration envisions not a trade war but a “negotiated settlement.” Trump just likes to emulate Attila the Hun in his initial negotiating positions, as he said in “The Art of the Deal.”

Asia Unhedged thinks the US tech rally is over. We have consistently faded the notion that US bond yields are going to run up massively, noting the prevalence of deflationary impulses in employee compensation (and that means we don’t like financials). It’s a good time to buy non-Japan Asia equities on the dip as well as exporters (Boeing, Caterpillar, 3M).

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