Leading up to the referendum on Scottish Independence, one trader remarked "there will be blood on the trading floor Friday" if the Scots were to vote βYesβ and chose to break the 307-year-old union with the United Kingdom.
The resounding story for the markets these last few weeks has been the unequivocal strength of the US dollar. The dollar closed higher Friday for the ninth straight week as it continues on its best run in 17 years.
Mario Draghi and the European Central Bank (ECB) shocked financial markets this week when they yet again revealed they were prepared to further combat a stagnating European economy.
As the markets awoke at the beginning of the week to news of a US air strike on Iraq, one aspect of the risk off trade that had been ensuing became clearer. Those who had been selling equities from the week earlier were doing so because of events in Russia.
Who would of figured that in a week when the US economy reported initial estimates of second quarter GDP growth of 4 per cent, that the Dow Jones Industrial Average would simultaneously erase its gains for the year.
The Obama administration is becoming quite critical of US corporations acquiring foreign firms in order to relocate their tax domicile to a country with a more favorable regime.
Gold prices gained for the sixth week in a row putting up the metalsβ best winning streak since August of 2011.
A clear message from investors as we head into the July 4th Holiday weekend in the United States is that equity markets are poised to continue their march higher.
The Financial Times reported this week that central banks around the world are in the process of repositioning their portfolios as they pare back their exposure to US treasuries.
Gold had its best single day performance since September of 2013 on Thursday of this week. It begs the question, what contributed or led to the 50-dollar rally?
The story with the ECB was that all they had to do thus far was wave their metaphorical policy weapon without every firing a bullet.
There is a bizarre dichotomy between financial markets and the economy.
Gold has not closed outside the range of 1,282 to 1,311 US per oz. since April 14, 2014. It has made the market action over the last six weeks decisively boring.
2014 so far hasnβt really panned out as many had anticipated. While financial markets, particularly equities have seen increased volatility, the year of a strong greenback (US dollar) corresponding to a strong US economy is yet to develop.
Equity markets on Friday provided no indication that the April jobs report exhibited the best growth in payrolls since January of 2012, or second best since the US escaped recession in mid-2009.
βThe inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of misery.β - Winston Churchill
Greeceβs return to the bond market was extremely well welcomed, but for the investment opportunity in an environment that will continue to see downward pressure in European interest rates.
Fridayβs US payroll numbers revealed a key milestone for the US labour market. Private employer payrolls surged to 116.09 million positions, a level not surpassed since January of 2008.
The Federal Reserve used their policy announcement and the press conference following the announcement to alter their method of forward guidance.
Financial markets are at the whim of how events will unfold in Ukraine. It is geopolitical tensions that are keeping the markets at bay.
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