Having not yet recovered from the pressing geopolitical and social risks of the past two years, the global economy will continue to experience turbulence in Q4, and into 2024. Below, FBS analysts name the three most prominent tendencies that would be pushing financial market volatility in the upcoming months:
Migration policy in the EU and the US: Although the liberalization of migration policy and the attraction of cheap lght-wing tendencies and increased focus on national minorities. This trend will remain stable in 2023 and 2024, potentially triggering regional disintegration. It can lead to an increased allocation of safe-haven assets like gold, making them a favorable investment target for the near future.
Prolonged tight monetary policy: High key rates, a consequence of inflation, were expected to slow down stock markets in 2023. While some stock exchanges in the EU and the US have experienced growth over 2023, the market is realizing the low possibility of stimulating monetary policy from regulators by the end of the year. Thus, in Q4, particular attention should be paid to European and American stock indices, as seasonality may provide significant support, and shares (especially on American exchanges) may rise. Nevertheless, the risks of continued decline may remain present even in 2024.
Deglobalization of the energy market: Over the past years, the largest energy supply countries, including the Gulf members and Russia, have gradually disconnected from the European energy market. At the same time, the current vector of European policy and the EU's shift from traditional energy sources will solidify the energy market. Consequently, in Q4, oil and gas prices are expected to remain stable or experience local fluctuations, potentially affecting global markets.
FBS Analysts indicate that financial markets will be challenged by political actions toward energy supplies and the development of monetary and migration policies for the rest of 2023 and beyond. Thus, traders should focus on agile trading strategies, exploit seasonality trends, and focus on defensive assets and mid-to-low volatility stocks.
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FBS is a licensed global broker with over 14 years of experience and more than 75 international awards. FBS is steadily developing as one of the market's most trusted brokers, with its traders numbering more than 27,000,000 and its partners exceeding 500,000 around the globe. FBS is also the Official Partner of Leicester City Football Club.