Contradictory signals from Nasdaq and gold

THE bears did not emerge in September or October. There is a general feeling of relief and a tentative hope that markets will remain immune to the bear unless the US presidential election throws a spanner in the works.

All markets are vulnerable to the whims of governments, which can goad the bears as easily as they unleash the bulls. The sharp rally in the Shanghai Index was triggered by China government policy announcements. In November, it is the US elections and the results.

Pre-poll pictures of burning official ballot drop boxes hint at the inevitability of significant political disruption caused by contested ballots. More than ever, investors need to remember that the US voting is not done and dusted with the November poll.