Markets Rise, But Many Stocks Stuck in Bear Territory
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What is the main topic discussed in this episode?
With your money briefing, I'm J.R. Whalen at The Wall Street Journal in New York. The recent run-up of stocks back into record territory has been good for many companies, but there are still many blue-chip stocks that are stuck in bear market territory. We'll explain why and name names in a moment. First, these money in market stories you should know. The strengthening economy and tight labor market are giving workers more confidence to demand employer concessions through strikes. And with the national unemployment rate at 3.9%, coupled with skilled workers and scarce supply, union officials say they have more leverage at the bargaining table and that workers are more comfortable with the risks associated with striking.
In Los Angeles, about 31,000 teachers are threatening to strike. while union members at U.S. Steel Corporation have given the authority to strike if negotiations break down. Labor disputes have caused workers, excluding teachers, to miss 633,000 days on the job this year through August. That's up from 440,000 all of last year.
What is driving the contrast between record market highs and some stocks in bear territory?
That's the word from the Labor Department. And if you include the wave of teacher strikes in the spring, there were more than 2 million days missed, the highest level since 2006. And a study from the University of Minnesota and the U.S. Census Bureau shows that married men make far more money than single men, single women, or married women.
Which widely held blue‑chip companies remain 20%+ below their 52‑week highs and why?
In fact, there's virtually no difference in wages between single workers of both sexes and married women. One reason for that could be that men tend to marry later than women, and so they're further along in their career by the time they tie the knot. Wages on average increase over time for both men and women, at least up until the age of 50, and men and women acquire more experience the longer they work, and therefore become more valuable and productive.
While the U.S. stock market has raced to new records, happy days are not here again for a group of stocks that remain stuck in bear market territory.
How are trade tensions and tariffs hurting industrials, materials, and commodities?
And Wall Street Journal Markets reporter Akani Ohtani is here with details. So Akani, the stocks that have not risen with the broader S&P 500 are stuck mainly because of trade fears.
Why are falling copper prices a warning sign for global growth and miners?
That's correct. For a lot of the stocks that we've seen who are at least 20 percent down from their 52 week highs or in bear market territory, they've cited issues with trade related tensions. So they're saying that because of the tariffs, they might have to cut back on their profit outlooks for the rest of the year or that. They might have to scrap some projects that they had previously planned. And a lot of those stocks happen to fall in the industrial and material sectors, which have been lagging behind the S&P 500 this year.
And these are some widely held stocks, like Harley-Davidson, Stanley Black & Decker, and Caterpillar, which is a bellwether for the overall health of the economy.
What retail pressures are causing established brick‑and‑mortar stocks to lag?
Yeah, so that's why it's been interesting to watch these stocks continue to languish in bear market territory, even as the broader market has reached new highs recently. So analysts and investors that we spoke to were saying it really shows that even though the U.S. economy looks like it's on strong footing and the broader market is setting new highs, that investors are still wary of these risks that individual companies are facing because of the trade fight.
And this has really been a little bit of a specter on the horizon for investors for about four months. They have seen these fears bubbling up and growing. And so I guess that they're realizing one of their own biggest fears.
Could big tech become vulnerable to escalating trade fights and how would that impact markets?
We've seen this evolution in what investors say ranks as the biggest tail risk to the markets throughout the year. So at the start of the year, people were really worried about inflation taking off and of central banks tightening policy too quickly. And then in the last four consecutive months, we've seen investors pulled by Bank of America saying actually a trade war is now their biggest fear in terms of what could topple the market.
And so in addition to a lot of these industrial and material companies hit by trade fears, some commodities are getting caught up here as well.
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Chapters
7 chapters
1
What is the main topic discussed in this episode?
0:05–1:06
2
What is driving the contrast between record market highs and some stocks in bear territory?
1:06–1:25
3
Which widely held blue‑chip companies remain 20%+ below their 52‑week highs and why?
1:25–2:04
4
How are trade tensions and tariffs hurting industrials, materials, and commodities?
2:04–2:15
5
Why are falling copper prices a warning sign for global growth and miners?
2:15–2:56
6
What retail pressures are causing established brick‑and‑mortar stocks to lag?
2:56–3:37
7
Could big tech become vulnerable to escalating trade fights and how would that impact markets?
3:37–6:45
Speakers
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