Material changes have not occurred in the markets Monday although there is lots of noise going on around the edges that ultimately could impact stock prices, writes Gene Inger on Monday night in IngerLetter.com.
Sanctions on Russia? Incidentally, the Russians possibly have an understanding with the U.S., since the impact on Russian companies and oligarchs is far greater than most realize. Hence, the U.S. has power it can wield beyond of course conventional military action or visible diplomatic moves at the UN or other avenues.
It all relates to the level of the U.S. dollar (USD/RUB), the ruble’s rate of exchange, and of course sanctions. So just delaying sanctions as was stated Monday may disappoint hawks but may be more potent getting Russian cooperation than imposing more forceful visible pressure for now anyway.
Bloomberg: Earnings spur stocks Tuesday as trade woes take a back seat.
That the Russians blocked the latest chemical inspectors Monday in Damascus is however counterproductive if Moscow wants cooperation. They likely hope evidence of chlorine will simply evaporate over time.
The ABC Comey interview and the Sean Hannity revelation (he claims he never paid a legal fee, but likely asked opinions on some allegations he made on-air) is related to radioactive Cohen, as he’s being portrayed by Stormy’s lawyer. This tragi-comedy is very much in limbo.
Does it matter to markets? Only around the edges, unless anything truly explosive comes out that derails the ability to govern, even more than it’s already been disrupted. It’s a shame really, but most of the players are not behaving as if traveling the higher roads. They all say so, but the language and some things said are embarrassing.
Most business do plan for further-out plans. And if one perceives limited guidance beyond near-term, it's likely going to rein-in long-term moves.
A for-instance would be the classic one: Apple (AAPL) has a slimmer market for product in China (not just pricing, but lack of dual-SIM cards and very popular apps for chatting and online paying that the Chinese embrace).
Apple has pledged to repatriate hundreds of millions to the U.S. and also to make more stuff here (such as the iMac I’m preparing this report on. It is a high-end model that’s been made in the U.S. for two years now).
For sure, if not for these reforms, Apple (and other companies) plans might be changed, or at least delayed, if they fear politicians reversing course.
Apple is planning to launch a news subscription service.
Bottom line: A move above resistance was likely as a relief rally quickly, in event of lack of serious response to the U.S. action on Syria. Nothing is changed with respect to extended markets with difficulty making it through an expected solid earnings period and alternating shakeouts likely. S&P 500 (SPX).
