Geopolitics and Markets Review – 30th January 2023

Ukraine War Escalation – Tanks, Tanks, Tanks

Everyone is carefully handing the kitchen sink to Ukraine, and in turn, throwing it at Russia. And they’re sending a few tanks too.

The US pledged 31 M1 Abrams tanks. Germany will send 14 Leopard 2 A6s. The UK will send 14 Challenger 2 tanks and Poland has asked Germany if they can send some of their own Leopard 2 tanks. Canada is sending 4 tanks, and Spain, Norway and The Netherlands are considering sending them.

Ukraine has been subject to infrastructure attacks in what has been a tough winter for the Ukrainians. The time that the tanks arrive will be very important. As quickly as possible will serve the Ukrainians best, especially as a Russian regroup and attack could occur at some time this year. With 500,000 more signups, Russia is looking to bolster the numbers of its active-duty army.

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Is The Stock Market Breaking Out?

I’m usually more fundamentally orientated in the markets and take long-term views of a general market direction. Unless shifts of a large magnitude occur in these fundamentals and I’ll change my market thesis. Currently, we are staring at a potential recession in the face. The US could navigate it slightly better than most so in the long term I remain more confident in the US market than others. But still not completely bullish. Europe as the centre stage for the energy crisis with skyrocketing costs last year and the Russia-Ukraine war will not fare as kindly.