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A punch drunk stock market keeps coming back for more

Published Monday, March 24th, 2014

Another week full of news and extraordinary twists and turns accompanied by a deluge of warnings once again left stock markets seemingly unphased. How many more punches can they take and keep bouncing back?

The Crimea has been annexed but the prospect of war is still in the distance, although if you believe the Ukrainian Foreign Minister it is getting a lot closer. The commander of Nato forces warned over the weekend that the Russian troop build-up on the Eastern Ukrainian border is alarming.

Nato say that the Russian troop build-up is “very, very sizeable and very, very ready”. The German Foreign Minister tells us that Mr Putin has opened a “Pandora’s Box” and the situation in the Ukraine is “anything but stable”. Cold Wars and economic prosperity do not make for good bed fellows, unless you are in the defense industry.

In China defaults are spreading to the property sector and the standard response of relaxing credit and providing bailouts will only exacerbate the problem. The week also saw the Governor of the Bank of England express serious concern about risk mispricing stemming from low interest rates and the Chairman of the Federal Reserve accepted that rates could begin rising next Spring.

To read the rest of the report, please click here 

Posted by David Hufton