Bar the Bull
At the Start
...eh?
Spicy Markets Yesterday...
- Thread starter Bar the Bull
- Start date
Colin Phillips
At the Start
Have things calmed down a bit today, Bar?
Bar the Bull
At the Start
Yes.
European equity markets have sold off a bit, but more in repsonse to yesterday's NY losses after Europe closed. New York is up a half a percent today.
I think it is just an adjustment (Eurostoxx had risen 7.5% since 1st Dec), but I think that risk premia have been a little too low recently; the world is not as benign as one would think from looking at the last few months in the markets.
I would classify yesterday as a flight to quality sparked off by China and the subprime story in the US. I fully expect a bid for assets cross markets in the next few days, but wouldn't like to be long to the gills without a decent amount of downside prrotection.
European equity markets have sold off a bit, but more in repsonse to yesterday's NY losses after Europe closed. New York is up a half a percent today.
I think it is just an adjustment (Eurostoxx had risen 7.5% since 1st Dec), but I think that risk premia have been a little too low recently; the world is not as benign as one would think from looking at the last few months in the markets.
I would classify yesterday as a flight to quality sparked off by China and the subprime story in the US. I fully expect a bid for assets cross markets in the next few days, but wouldn't like to be long to the gills without a decent amount of downside prrotection.
BrianH
At the Start
Surely the threat to Iran had something to do with it too? We got away lighter over the last two days than i expected.
Bar the Bull
At the Start
Brian, I honestly don't think that Iran has much to do with it.
The subprime story is the only game in town in the US. And China is another focus here in London and in Europe.
The subprime story is the only game in town in the US. And China is another focus here in London and in Europe.
Bar the Bull
At the Start
Krizon,
Let's pretend you are a speculative equity (shares) investor. If you are extremely bullish (positive) on the market, you will buy lots of shares. This makes you long. If you are long to the gills, you are as long as you can go, you own as many shares as you can.
Now is not the time to be ultra long, as waters are still relatively choppy.
Let's pretend you are a speculative equity (shares) investor. If you are extremely bullish (positive) on the market, you will buy lots of shares. This makes you long. If you are long to the gills, you are as long as you can go, you own as many shares as you can.
Now is not the time to be ultra long, as waters are still relatively choppy.
jft2005
Conditional
thats what alot have thought, but if it was the cause then Gold prices would have increased?
Bar the Bull
At the Start
Why would gold prices drop on a subprime/China shock but not on an Iran shock?
Bar the Bull
At the Start
Only if you promise to short 1M S&P500 variance swaps with it.
jft2005
Conditional
My thinking is that if the threat to Iran had anything to do with the markets dropping, then the dollar would have gone down & therefor pushing gold up?
Bar the Bull
At the Start
Incidentally, Brian, Iran is starting to get people a little jittery now.
Jft, your reasoning is probably sound. Probably the reason gold went down was that India and China are the main users of gold, and a shock in the region would curb demand. However, the Iran story today is pushing the safe haven argument.
Jft, your reasoning is probably sound. Probably the reason gold went down was that India and China are the main users of gold, and a shock in the region would curb demand. However, the Iran story today is pushing the safe haven argument.