2016/06/27 TrendView VIDEO: Global View (early)
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TrendView VIDEO ANALYSIS & OUTLOOK: Monday, June 27, 2016 (early)
First of all, while markets are very volatile there does not seem to be any slide into a ‘crisis’, at least not so far. However, we need to allow the old adage that “markets (which implies the equities) dislike nothing quite so much as uncertainty” is at work now. Whatever else the UK referendum resulting in the LEAVE the EU campaign succeeding means, there are various interpretations. And all of them are quite a bit less clear than the broadly anticipated result from a REMAIN decision to continue the UK-EU relationship. That is just to state the obvious, and the fact that the decision has fomented a lack of definitive positions in the entire UK political establishment as well as differing opinions in Europe heightens the sense of uncertainty.
While we presume most of you have already seen the major analysis of this, it is worth reviewing a few salient points. After UK PM Cameron resigned on Friday, he said he did not plan to invoke the EU Treaty ‘Article 50’ official start of the UK withdrawal negotiation. He said that should be left to his successor. Which means it will not happen until the Tory (Conservative) Party Conference in October chooses that new leader. To make matters even more uncertain, Labour Party leader Corbyn’s position is also being challenged. There is a very good BBC article on this (marked-up version.)
So there is not likely to be any official UK withdrawal request for more than three months. Some officials will undoubtedly be considering those plans. Yet the two year window to negotiate it will not begin until then. And quite a few REMAIN campaigners are calling for a second vote. And this is all in the face of a less than unified EU position. POLITICO noted the ‘Core 6’ original EU members called for an aggressive negotiation. Yet cooler heads suggested there is no rush, and the new relationship with the UK should be not be ‘nasty.’ And that camp includes the Big Dog: German Chancellor Merkel.
Video Timeline: It begins with macro (i.e. fundamental influences) discussion the factors noted above, and avoids any mention of near term fundamental factors that have been overrun by the Brexit major ‘macro’ psychology shift.
It moves on to S&P 500 FUTURE short-term view at 02:15 into the intermediate term view that is actually the ‘Quick Take’ at 04:00, with OTHER equities from 07:00, GOVVIES beginning at 11:15 (with the BUND at 16:30 including implications of expiration rollovers) and SHORT MONEY FORWARDS from 18:15. FOREIGN EXCHANGE covers the US DOLLAR INDEX at 21:45 EUROPE at 24:00 and ASIA at 28:15, followed by the CROSS RATES at 30:00 and a return to S&P 500 FUTURE short term view at 33:30. As this is a longer than usual discussion, we strongly suggest using the timeline cursor.
Authorized Gold and Platinum Subscribers click ‘Read more…’ (below) to access the balance of the opening discussion and TrendView Video Analysis and General Update. Silver and Sterling Subscribers click ‘Read more…’ (below) to access the balance of the opening discussion. Read more...