Market complacency is great. Ukraine took advantage of its newly granted long rang missile capabilities to strike a military base on Russian territory. Moscow, which warned against such action, stepped up its threat of a nuclear response to conventional attacks.
As widely noted, the introduction of North Korean troops to the war has been greeted with yawns, perhaps viewed as only as additional pieces on the war’s chess board.
Some believe the prospect of a Trump return to he the White House and his pledge to end the war in short order has created a new sense of urgency for Ukraine and its allies, perhaps a reason as to why such provocative actions are viewed as a market nonevent.
The possible ramifications of war are unquantified. Desperate parties may take drastic actions as the proverbial risk reward calculation may suggest there is little left of the downside.
Yesterday markets instead focused on today’s release of NVDA’s earnings as that company rose about 2.5%. A gauge of the “Magnificent Seven” megacaps advanced about 1%. Bloomberg writes “options trading signals NVDA’s results today will be the most important catalyst left this year—even more than the Fed’s December meeting.”
Will this statement be completely misplaced especially if the situation in Ukraine escalates considerably, perhaps under the same guise as Neville Chamberline’s statement “We have won peace for our time?”
Last night the foreign markets were up. London was up 0.09%, Paris up 0.32% and Frankfurt up 0.35%. China was up 0.66%. Japan down 0.16% and Hang Seng up 0.21%.
Futures are up 0.25% on NVDA earnings optimism. On the geopolitical front, the US closed its embassy in Kiev fearing a “potential air attack as tensions soar with Russia.” The 10-year is off 6/32 to yield 4.42%.
