Possible Market-Moving Events This Week (Oct 27-31)

• Geopolitical as well as economic events influence market direction and volatility. Here are the biggest "known" events occurring this week.
• We are long-term investors  – but at critical market turns, the short term is also key!
• The items in bold are the ones we believe are most likely to have the greatest market effect this week.

I have attached a table below showing the current "front burner" geopolitical and economic issues that I believe are most likely to influence market direction and velocity this week.

I have marked in bold those most likely to have either a salutary or deleterious effect with the greatest volatility. Clearly, if the Fed says it will start QE Whatever rather than let the current one expire, the markets will be volatile: some will rush to buy, assured that the Yellen Put is still in place under the market, others will rush to sell because the Fed will thus be signaling the economy is not strong enough to make it on its own without massive intervention. At the end of the day, it would be more likely that the sellers would be correct.

Likewise, if crude oil and gasoline inventories remain high or climb, the oil & gas sector is likely to fall even further. Given our oft-stated desire to own these companies at the best price possible for the inevitable rebound, this wouldn't hurt our feelings. Of course, with feedstock prices low, the chemical and plastics industries would likely (continue to) benefit and their share price should reflect that likelihood. Ultimately, it's always about future earnings. Conversely, if inventories decline, the oil and gas explorers, drillers, machinery suppliers, etc., should enjoy at least a bounce.

Since we remain long-term investors, we'll use any weakness to add to our positions. [Disclosure: per my previous SA article, we purchased Diamond Offshore (DO.) It rose 20% in 2 weeks and we decided that was too much, too fast –Â we took profits on Friday, Oct 24.) It is among the companies we'd buy back at $33 or less.]

On Thursday we will see two Big Ones –Â New Jobless Claims and preliminary Q3 GDP. I think it's safe to say that if the Fed disappoints on Wednesday, the GDP figure will be pretty good. They can always downgrade it later when it is no longer top of consciousness.

Finally, the wild card in all this milieu is not economic but medical. Will Ebola be contained or will many new cases pop up beyond West Africa? Placing this in perspective, thousands die every year of the flu, and Ebola has thus far not been nearly so virulent, nor has it proven itself adaptable to airborne contagion. But any change in these dynamics, and the markets will reflect the medical fears. My guess is that the already hard-hit emerging economies, with less-advanced health care systems and infrastructure, would be hit the worst in such a scenario.

I offer the below as a starting point for your thinking. If I've missed a key event or trend, please let me know –Â it can only make our combined analysis stronger going forward!

The Fine Print: As Registered Investment Advisors, we believe it is our responsibility to advise that we do not know your personal financial situation, so the information contained in this communiqué represents the opinions of the staff of Stanford Wealth Management, and should not be construed as personalized investment advice.

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