Market On Open, Wednesday 2 October

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What’s Louder Than Bombs? The Sound Of The Cash Register

by Alex King, CEO, Cestrian Capital Research, Inc

Until we actually do have WW3, the time to buy risk assets is, it seems, right before the missiles fly. The rally in early trading today has a good chance of continuing, at least if there is no further theater escalation in the Middle East. I think markets can deal with targeted attacks (pagers etc) just fine, and as we have seen with the Russian invasion of Ukraine, even large-scale civilian death and supply chain problems are taken in the market’s stride in the end. Nobody ever said that capital markets were nice. What’s important is to understand what counts as risk to capital markets; and that comes down to (i) liquidity, as in, the availability of money with which to buy securities and (ii) price, as in, the price of the money made available to buy securities. This is why the 2022 market was so tough on stocks. Bombs? Can be shrugged off. Rate-hike-cycle plus QT? Not so much.

We may see a rocky October through to the last week, when corporates are printing earnings and can then recommence buybacks. Either way, as a house we continue to look upwards into year end.

Let’s get to work.

Short- And Medium-Term Market Analysis

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