Markets are quiet at the moment, but I reckon things will start to heat up when European and US traders come in later
And it will be about Gary Cohn's resignation.
The news broke out after US markets have closed and when European traders are catching some shut eye, so expect a lot more reaction in the market to come later in the day when they do come back into the office.
The initial response to Cohn's resignation has been about trade wars, and that without Cohn, chances are we are likely to see it happen. But that's just the tip of the iceberg.
There's so much uncertainty surrounding his resignation and that is something markets may have to take time to digest and figure out.
Is Trump prioritising trade wars over the stock market performance? How much damage is done to the relationship between Trump and senior GOP members? What does this mean for future policy decisions such as infrastructure spending? How much confidence in the Trump administration has been hurt from Cohn's resignation? Where does this leave Trump and the GOP in the coming mid-term elections?
Those are some real issues to ponder for the market and if Trump starts to ramp up the trade wars rhetoric further, the mess is really just beginning.
This could all be blown over proportion of course, but the best way in my view to judge the situation is to see how the trade rhetoric is handled. That will provide the clearest indication for how things will be over the coming months with regards to policy making by Trump's administration.
While today's trading will surely revolve around the uncertainty of those elements, this is something that could potentially go on for a few more days or weeks.
