A bumpy start to 2020

Well it certainly hasn’t taken President Trump long to rock the boat in 2020 and this is with the killing of General Qasem Soleimani, the head of the Iranian Revolutionary Guards Quds Force in Baghdad and Soleimani was by American opinion leading anti American attacks throughout the Middle East. This also when we saw the Dow Jones hit yet another record high, the PBOC reducing capital requirements to inject some $430 billion into the Chinese domestic economy and the LME metals all tried to make higher ground. However the strike in Baghdad has sent the oil market up $2 gold up $9 , but more damaging for metals the Dow futures are down 190 and the Asian equities are falling back. Nickel has been hardest hit falling from the close of $14225 to the current $13940 Copper has fallen below $6200 to $6182 and the rest of the complex is down between.25/.50%. Russian and China have not reacted as yet but in light of trade talks China may well steer away from too much rhetoric but Russia is more likely to wind up the regional pressure. So we have stock markets falling away from record highs , oil prices moving up , regional instability cranking up again in the Middle East and the LME metals all looking rather overbought in the short term. If current events spook investors into squaring up equity portfolios the fall in equity prices could well be spectacular and metals will not be able to survive that short term storm even if the physical demand picture is starting to improve. To use a cliche fasten your seat belts this could be a bumpy ride.