Market Talk
A two-week ceasefire has been declared between the U.S. and Iran with each side claiming victory. Negotiations will continue along with a tentative agreement to keep the Strait of Hormuz open, allowing ships to pass through the 24 mile-wide passage at its narrowest point.
The markets are responding with a relief rally on hope the ceasefire will last and negotiations will move toward something more lasting.
But within a day, Iran is right back at it — missiles toward Kuwait and the UAE, while telling Israel to stand down against Hezbollah in Lebanon.
The market likes the surface aspects — but are they just superficial talking points, like a strawman paper deal with no backbone to make the regime comply with a non-aggressive approach to the region and stop their jihad ideology?
All in all, the market is saying risk back on.
Oil and natural gas are down as money rotates out of a volatile energy sector.
Gold is back on. KGC in the gold mining sector and HL in the silver mining sector are back on.
Tech stocks are back on — at least for now.
A relief rally can take hold or fizzle as realities of market forces take hold.
That said, stocks may have room to run because the economy does have some green shoots showing up this spring, and if energy / oil price hike fears subside, a better picture can play out.
It’s too early to know if a ceasefire will hold — uncertainty remains.
One thing though — the U.S. wants it to last so we can wrap this up and move on. But just leaving is not a viable option. The Middle East needs to be in a more stable status.
Stock Talk
How traders and investors approach a relief rally is up to each — we don’t make buy or sell calls here.
However, it does not seem prudent to be trading oil stocks in this climate.
On the other hand, gold and silver remain viable, and in that light, miners like KGC and HL remain on the Jones watch list.
There are many risk-on stocks — too many to mention.
A few we are watching:
KGC
HL
NVTS
GFS
INTC
Each with their own market dynamics.
This is a quick wrap to address the relief rally we are seeing the day after a ceasefire was announced.
Will it last?
Time and further peace negotiations remain to be seen.
Staying disciplined and circumspect with portion control, smaller new positions — that’s one way to navigate uncertainty.
Markets trade the headline… but they settle on reality.
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More later so ....Stay tuned, if you dare!
For now, we close by noting that any view on the market and stocks on any particular day may change in the days to come. That is why we watch and see how our views match up with reality. Looking ahead a few months may be a way to do things - but thinking too deeply about world events and the recent alliances forming, can make projecting ahead a dicey endeavor.
All in all - we use the word maybe "some", not "too much" and play it accordingly. Never get arrogant in our notions because things do change - and individual stocks are subject to many factors outside our control. So, we try to -stay aware.
With all the above caveats and attempted prognostications, I will close this post. Stay tuned for more opining on the market and stocks to watch.
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