All asset classes these days move as a function of risk aversion. The market is divided into two camps, one looking for investment opportunities and one believing that the markets still corrects and that the global problems aren’t over yet. Last week it was very clear that as soon as tensions went up, the Dollar traded down together with equities. The volumes (particular in the stock market) are low, so the true development is difficult to judge as short term speculators have a larger part of the summer market. Many real money managers and private investors have their well deserved holiday break, but will soon return to a financial world that isn’t too easy to handle. Some will return with an optimistic hope ready to invest, but my best advice is still to look cautious at Far East, but stay sidelined for the rest.
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