How much discounting of the pardoing of the UK sailors was already factored into the stock market picture? We'll know soon enough. At least things aren't totally insane in the Middle East and that this situation appears resolved. S&P futures are up just a modest 2 points. The reaction has been sharper in gold and crude oil. June gold ran to the $680 mark and is back to $676 and crude is down, though off the lows at just above the $64 mark. While the sailors are supposedly going to be returned, I'd be surprised if crude returns to pre-abduction levels. I can't help but to wonder if the markets won't factor in more geopolitical risk,... wow what a concept. This would go for the VIX as well. Perhaps there isn;t total insanity which is allowing this so called 'pardon', but we all know that this just another move in a much larger and increasing dangerous game between the West and Iran.
As usual, the ADP job survey sparks some debate about how Friday's government payroll report will look. ADP indicates growth of 130k, Friday's non farm payrolls are predicted by economists to rise by 135k accordings to the survey that is by Econoday; so this time around not much difference.
I thought this was an interesting blurb:
UK Fund manager sells off equities, says expecting "severecorrection" - FT: Ken Murray, the founder and chief executiveof BluePlanet Investment Management and former CEO of MurrayFinancial, hasoffloaded equities and cut the gearing on the firm's portfoliosto zeroin the belief a US economic recession is set to wipe more than20 percent from the value of global stock markets.
I think Murray will be right at some point, but I'm not at the point where I've done that myself... still plenty of long positions in the portfolio.