Present volatility -- per all of our commentary -- makes sense, however....

We've been strongly suggesting that the correction has yet to run its course, which means days like the last three (we'll see about today) were in the offing with or without the ill-timed (always ill-timed!!) announcement that the U.S. is about to do a number on its own consumers, its exporters, its manufacturers who import all manner of components, and of course its key international relationships.

So, yeah, more volatility makes sense, however -- while the details are yet to be disclosed -- the latest catalyst is troubling.

If the market's negative reaction to the announcement of potentially stiff tariffs on steel and aluminum -- while we did entertain the notion yesterday that, based on severity, and, I'll add, based on the reaction of our major trading partners, the market may not react in overtly negative fashion (the fact that the details are up in the air clearly has the market assuming the worst) -- has you puzzled, you haven't spent enough time herein.

Here's from our 2017 year-end letter highlighting the risks of protectionism to, for example, the tech and industrial sectors:

TECH:

Threat of U.S. protectionism: Tech underperformed other cyclical sectors measurably between last year's election and the beginning of this year. Our view is that -- along with the at-the-time appreciating dollar -- the poor relative results stemmed largely from traders reacting to the prospects for a negative impact on the most internationally-centric U.S. companies, should rhetoric become reality. After the inauguration, however, it appeared as though the more aggressive of the Trump campaign's protectionist propositions would not come to fruition, which remains the case for now. Any new trade barriers erected at this juncture could prove to be significantly negative for the sector, in our view.

INDUSTRIALS:

Protectionism: Now, combine a potentially higher trending dollar with higher barriers to international trade (which has, thus far -- notable exception(s) aside -- been more rhetoric than realty) and we'll have a combination that could ultimately put our bullish thesis to the test. 

Ironically, tech and industrials were two of the three worst performing sectors on yesterday's news.

Keep in mind, the President has assumed ownership of the bullish action in stocks during his brief tenure. Thus, one might assume that if the market continues to express its understandable distaste for this profoundly business, investor and consumer-unfriendly maneuver that there'll be some major watering down before the plan is implemented.

In either event, there'll be no knee-jerk reaction here. Of course we'll be closely monitoring and ultimately accommodating for any potential longer-term negative impact on the fundamentals that instruct our sector and regional allocations. 

There's a video coming your way a little later that we encourage every client to watch...