Stocks Markets “Brush Off” Geo-Turmoil
$DIA, $SPY, $QQQ, $VXX
European stocks pared losses and US futures rebounded after a terror attack in France killed dozens of people, and the bloody military coup in Turkey the latest display of market resilience in keeping with recent history.
Over the past 15 years, financial-market reactions to terror have proven for the most part short-lived.
At least 84 people died and many were injured when a driver plowed his truck into a late-night crowd in the coastal city of Nice on Bastille Day.
The rampage ended after the driver was shot to death by the police, and forcing President Francois Hollande to call up military reserves and extend the state of emergency that for 3 more months.
It’s the 3rd major terrorist attack in France since the January 2015 shootings at the Charlie Hebdo satirical newspapers and a kosher store near Paris.
Past incidents, such as Madrid’s train bombings that killed 191 people in March 2004 and blasts that left more than 50 dead in London in July 2005, had spurred declines in equities that were erased days or weeks later. Recoveries have been fast in recent years.
Turkey’s political climate is about to become even more oppressive and authoritarian. With an attempted military coup of this scale, investors already cautious due to past crises will be even more skeptical about Turkey’s business environment and the government’s ability to maintain macroeconomic stability. Expect capital to flow out of the nation and the Turkish lira to flounder.
Some investors said they will now wait to see to what extent the crackdown tightens the Islamic-rooted AKP’s hold on power and enables strong man President Erdogan to bolster his authority.
No matter, the uncertainty in that Key US ally nation, the world’s stocks market so far is yawning.
No need to worry one analyst Tweeted, Turkey is normalizing rapidly after the coup attempt was repelled by the nation. “The country’s macroeconomic foundations are solid.”
Even as global economic growth struggles, Turkey’s GDP has beaten estimates since Q-4 of Y 2014, thanks to rising household spending driven in part by millions of Syrian refugees. The economy grew 4.8% in Q-1 of this year.
For the markets, it is not irrelevant from a human perspective, but from an economic perspective, as sad as it might sound, it is an incident that happens on a regular basis. And markets have gotten quite used to that.
Monday, the US major stock market indexes finished at: DJIA +16.50 at 18532.29, NAS Comp +26.19 at 5055.78, S&P 500 +5.15 at 2166.83
Volume: Trade was light with about 723-M/shares exchanged on the NYSE.
- DJIA +6.4% YTD
- Russell 2000 +6.4% YTD
- S&P 500 +6.0% YTD
- NAS Comp +1.0% YTD
|HeffX-LTN Analysis for DIA:||Overall||Short||Intermediate||Long|
|Bullish (0.31)||Neutral (0.19)||Very Bullish (0.50)||Bullish (0.25)|
|HeffX-LTN Analysis for SPY:||Overall||Short||Intermediate||Long|
|Bullish (0.25)||Bullish (0.25)||Bullish (0.35)||Neutral (0.14)|
|HeffX-LTN Analysis for QQQ:||Overall||Short||Intermediate||Long|
|Bullish (0.32)||Neutral (0.10)||Very Bullish (0.56)||Bullish (0.31)|
|HeffX-LTN Analysis for VXX:||Overall||Short||Intermediate||Long|
|Bearish (-0.31)||Bearish (-0.27)||Bearish (-0.31)||Bearish (-0.33)|