Heightened geopolitical concerns centered on North Korea will once again weigh on U.S. markets this week amid reports in the South Korean press that the north is preparing for another intercontintental missile launch, Prudential’s Chief Market Strategist Quincy Krosby said Tuesday in her weekly “Connecting the Dots” outlook.
“While these periodic episodes of saber rattling have offered buying opportunities as the ‘risk-off’ trade unwinds, rhetoric continues to escalate, keeping markets on alert,” Krosby said.
Also this week, the market will see a parade of Federal Reserve speakers before the blackout period when officials are not allowed to discuss monetary policy before the Federal Open Market Committee meeting.
Traders and investors likely will pay close attention to a speech Thursday from New York Fed President William Dudley, whose views often align with those of Federal Reserve Chair Janet Yellen, Krosby said. Dudley recently observed that there may be another rate hike in December, so any change in his comments will be noted.
In data releases this week, factory orders, service sector reports and the Beige Book will help analysts assess the strength of the U.S. economy. Economic data have been trending higher in the U.S. as well as globally, helping to underpin market performance, she said.
And as Congress returns to Washington, debate on the debt ceiling and budget probably will garner attention, but North Korea hovers over other concerns as leaders around the world attempt to diffuse the mounting crisis, she said.
To talk to Quincy Krosby about her views of the market, contact Lisa M. Bennett or Dara Scerbo.
Read Quincy Krosby’s full Q3 Market Commentary: Third Quarter Checkup.
The views and opinions are those of the author at the time of publication and are subject to change at any time due to market or economic conditions. This is solely for informational purposes. This is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy.