Tax Advice Santa Rosa – WILL THE SYRIA CRISIS SHOCK THE MARKETS?

September 5th, 2013 → 9:21 pm @ // No Comments

Are fears of a correction & runaway oil prices overblown, or justified?

U.S. military action in Syria appears imminent. Assuming it happens, what happens to the financial markets?

Investor reaction on August 27 (the day U.S. intervention was mentioned as a possibility) was not exactly surprising. Gold entered a bull market again, oil prices reached a six-month peak (surpassing $109 a barrel), the Dow fell 170 points and the CBOE VIX rose 12%. Overseas markets broadly slumped; emerging market stocks hit a 7-week low. India’s rupee fell to a record low versus the dollar. The yield of the 10-year Treasury dipped to 2.72%, decreasing for a third straight day. All of this left market analysts with major questions to consider.

Will oil hit $150 a barrel? While U.S. investors keep an eye on the NYMEX, the international benchmark is Brent crude. Some analysts do see Brent crude hitting $120-125 in the coming weeks – Michael Wittner, global head of oil research for Societe Generale, told CNBC that he believes that will happen, in the event of military intervention. Wittner also thinks that Brent crude has about a 20% chance of pushing past $150, but not wholly on what goes on within …Read More


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