March Week 3 Pre Market Open Commentary

Trading Cocktail March 13, 2022 News Leave a comment 640 Views

March Week 3 Pre Market Open Commentary. Things happening on Sunday that might have an impact on the market’s sentiment on Monday and the rest of the week:

Russia Strikes Military Center Closer to Poland
China daily local symptomatic COVID cases more than triple

Based on the recent development, Ukraine’s President Volodymyr Zelenskiy and one of his most senior aides, “constant” video conversations with Russia are taking place. After meeting with Zelenskiy, Vladimir Putin talked with his French and German colleagues. In contrary, the newest event which can create another fear risk-off mode in market is the report on Russia strikes military center closer to Poland. This potentially can escalate the easing conflict which was happening for the last couple of days, but with all the sanctions and actions took by companies and organisations keep coming to hit the Russia economy.

List of Latest Sanctions on Russia by countries

List of Latest actions on Russia by Companies and Organisations

For more detail is the good way to track the economic sanctions on Russia and Actions by companies and organisations: Reuters

Adding to this, China daily local symptomatic COVID cases more than triple. The number of domestically transmitted cases with confirmed symptoms reported for Saturday rose sharply from 476 the previous day, data from the National Health Commission showed on Sunday. The 1,807 daily count included 114 initially classified as asymptomatic who developed symptoms later on Saturday.

More over, the economic data showing more and more green prints across the board and Inflation estimates have gone crazy. Across the board, markets are pricing in massive, long-term price increases. In the commodities market, the collateral damage is beginning to touch many regions. Impatience with the spread of commodities trading businesses’ structural liquidity and solvency difficulties.

‘Negative’ news stream will likely to keep flooding doom everywhere on the market and makes reaction economic fundamental data is not as significant as it is in risk-on mode. But always take note that market could give strong reversal if there is very good development or real clear positive sign that Ukraine crisis will end. Interesting commentary from thought leader of everything cross-asset at Goldman Dominic Wilson is saying that the market is getting the following two things wrong: “”Looking at current pricing, two core areas of our structural views are again starting to stand out. We think the market may be underestimating the risks of tighter supply on oil pricing, which remains a key risk from the ongoing conflict–so we think the “risk premium” here should probably be larger. And we think the market is starting to overestimate the impact that the conflict will have on the Fed trajectory and so think that front-end rates are ultimately likely to reverse this recent rally. Despite the obvious uncertainties that the invasion brings, those two areas are likely to remain important themes in our market forecasts”.

See also New York Session Heads Up October 14 2022

The Extreme Fear

The question is do markets crash on fear, or is this a buying opportunity? Equities have oscillated bigtime, but SPX is trading at the same levels we traded at a month ago basically.