- Moving the markets
A roller coaster ride best describes today’s session with the markets homing in on every stimulus word uttered, then jumping on hopeful comments while slipping on disappointing news. Nothing else seemed to matter.
Goldman Sachs economist Alec Phillips noted that “the biggest issues remain unresolved and a deal doesn’t seem particularly close.”
“With big differences and little time, it seems unlikely that Pelosi and Mnuchin will reach a deal before the election. More importantly, even if a deal in principle is announced in coming days — this seems possible, but not likely — it looks very unlikely that it would pass before Election Day,” he added.
In the end, the major indexes dropped moderately, but gold stood out and solidified its position above the much fought for $1,900 level.
Markets are currently not just pricing in an increase in volatility around Election Day, but also a sustained high-volatility environment thereafter – both in the post-election period and in the long run. Does that sound like an environment to be buying every dip at record highs?
That is exactly why we have reduced our exposure, since sharply increasing volatility on and after election day can wreak havoc with market sentiment.Read More