What a difference a few weeks makes in the markets! In late July the US indices were hitting all time highs, now it looks like the Dow Jones Industrials are in danger of slipping back below 16,000 after a couple of weeks of heavy losses. The Nikkei 225 lost close to 3% overnight as President Obama announced his approval for airstrikes to combat the Isis advance in Northern Iraq. The FTSE is holding just above the 6500 mark at 6,537.
As reported yesterday, Kurdistan based oil explorers have been hit by the action in Iraq and today Afren didn’t help matters announcing that it “has taken the precautionary step to temporarily suspend operations at the Barda Rash field,” and it was withdrawing all non-essential staff from the field. Not great news after the surprise suspension of the company’s COO and CEO as a result of an investigation on irregular payments. Gulf Keystone is down another 9% to 61.5p this morning!
With Mario Draghi, the ECB President warning that European economic activity remained fragmented and subdued and Japanese investors worrying about the impact of a stronger yen on their exporters, plenty of profit taking about and little reason to commit funds right now. The risk pendulum has swung to caution, with gold up to around $1320 an ounce.
The collapse of proposed deals like the Fox Time Warner takeover and worries about tax inversion deals like AbbVie’s buy out of Shire have added to the fear that the M&A frenzy of recent months may be topping out.
Further falls should flush out some opportunities in coming days but right now the sense is not to dive in too early as the negative geo-political environment continues to hamper sentiment in owning equities. The markets were pretty dull back in the early summer with little volatility, that situation has completely changed as shares continue to slide. No panic selling right now, but the US open will be interesting.
Contrarian Investor UK
IMPORTANT: The posts I make are in no way meant as investment suggestions or recommendations to any visitors to the site. They are simply my views, personal reflections and analysis on the markets. Anyone who wishes to spread bet or buy stocks should rely on their own due diligence and common sense before placing any spread trade.
by contrarianuk
Risk aversion reigns supreme
Aug 8, 2014 at 7:46 am in Market Commentary by contrarianuk
What a difference a few weeks makes in the markets! In late July the US indices were hitting all time highs, now it looks like the Dow Jones Industrials are in danger of slipping back below 16,000 after a couple of weeks of heavy losses. The Nikkei 225 lost close to 3% overnight as President Obama announced his approval for airstrikes to combat the Isis advance in Northern Iraq. The FTSE is holding just above the 6500 mark at 6,537.
As reported yesterday, Kurdistan based oil explorers have been hit by the action in Iraq and today Afren didn’t help matters announcing that it “has taken the precautionary step to temporarily suspend operations at the Barda Rash field,” and it was withdrawing all non-essential staff from the field. Not great news after the surprise suspension of the company’s COO and CEO as a result of an investigation on irregular payments. Gulf Keystone is down another 9% to 61.5p this morning!
With Mario Draghi, the ECB President warning that European economic activity remained fragmented and subdued and Japanese investors worrying about the impact of a stronger yen on their exporters, plenty of profit taking about and little reason to commit funds right now. The risk pendulum has swung to caution, with gold up to around $1320 an ounce.
The collapse of proposed deals like the Fox Time Warner takeover and worries about tax inversion deals like AbbVie’s buy out of Shire have added to the fear that the M&A frenzy of recent months may be topping out.
Further falls should flush out some opportunities in coming days but right now the sense is not to dive in too early as the negative geo-political environment continues to hamper sentiment in owning equities. The markets were pretty dull back in the early summer with little volatility, that situation has completely changed as shares continue to slide. No panic selling right now, but the US open will be interesting.
Contrarian Investor UK
IMPORTANT: The posts I make are in no way meant as investment suggestions or recommendations to any visitors to the site. They are simply my views, personal reflections and analysis on the markets. Anyone who wishes to spread bet or buy stocks should rely on their own due diligence and common sense before placing any spread trade.