hisah wrote:Go to post #1. Different conditions at the moment and worse we have the banking sector in a fix. When banks trip you hold your cash for you can't tell when the next shoe will fall off. The market will only form a proper floor in such an environment when the liquidity taps are flood opened. The CB has to do a sizable rate cut or initiate other market operation tools for sizable liquidity injection.
The market has been pessimistic since last yeart then when the weak recovery was building up another bank falls!
To shift extreme sentiments you need to shock the market the other way. The CB will have to come out with a bazooka KES be damned!
Market anxiety is palpable. Participants are getting fidgety by the day. The indices have been literally mark timing since Q4 2015.
I am no chartist/technical analyst but the only other period we had such a scenario was immediately after we hit the all time high of 6161. A quick slide then a stagnation/back and forth action between a narrow range of 4800-5300 for nearly a year. In the meantime, while those levels held steady the fundies kept deteriorating.
Back to present conditions, even the collapse of chase bank seems not to have dented anything. The economy is definitely not in good shape, the govt managed to dodge the January/February payday on its ever growing debt burden. ..how long till this cat and mouse game comes to its inevitable end, pressing forward with the second eurobond to me is reckless or an act of desperation.
Global economy is not a source of consolation either. IMF is dead set to unleash hell on account of a Brexit. So again, how long till the indices cave in?
The main purpose of the stock market is to make fools of as many people as possible.