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Will raging US bull market get infected by bearish foreign trends? – KIIITV.com

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(FILES) This file photo taken on December 8, 2016 shows the Wall Street Bull sculpture in the Financial District in New York. Wall Street stocks rose early February 3, 2017 on a solid US jobs report as shares of large banks rallied on news the Trump administration will roll back financial regulations. The January US employment report included a better-than-expected 227,000 new jobs last month, keeping up the positive trends from the Obama years into the start of the term of President Donald Trump.Large banks such as JPMorgan Chase and Bank of America rose almost two percent as administration officials signaled that Trump will order a review of the Dodd-Frank law enacted after the 2008 financial crisis. / AFP PHOTO / Bryan R. SmithBRYAN R. SMITH/AFP/Getty Images ORIG FILE ID: AFP_LD7LB

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The bull may still be charging on Wall Street. But the bear is growling overseas.

The good times in the U.S. market, where stocks are trading near record highs as the longest bull run in history rolls on, aren’t being enjoyed in many foreign markets, where trade disputes and a strong dollar are hurting growth and pushing stocks sharply lower. Earlier this week, some markets – such as Hong Kong’s Hang Seng index, mainland China’s Shanghai composite and a broad-based emerging markets exchange-traded fund – fell more than 20 percent from their January highs into bear market territory. 

In contrast, the U.S.-focused large-company Standard & Poor’s 500 stock index is up nearly 9 percent this year and just a tad shy of its record closing high hit in late August.

The growing debate on Wall Street is whether the disconnect between U.S. and foreign markets can continue.

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Bulls see the trend of U.S. stocks doing better continuing, stressing that the domestic market is a haven of sorts. They make the case that the U.S.-driven economy, which grew 4.2 percent last quarter, its fastest pace in four years, is less vulnerable to the downside of global trade disputes. Consumers, responsible for about two-thirds of the nations’s growth, are in good shape. Both shoppers and workers are benefiting from the lowest unemployment rate in 18 years, a key factor that lifted profits at U.S. companies last quarter at the fastest pace since 2010.

Bears, or pessimists, counter that the U.S. won’t be shielded from slowing growth abroad forever. They warn that the American economy and stock market aren’t totally immune to the slowdown abroad and can’t remain an island – or safe haven – forever. Big companies in the S&P 500 get more than 40 percent of their sales from abroad, so continued weakness in places such as China, Europe and emerging markets will eventually cause both U.S. business and corporate earnings to slow.

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