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Iran's massive missile strike on Israel spoiled the investing sentiment across the world on the very first trading day of October. The MSCI World index, tracking the performance of large and mid-cap equities across 23 developed countries, lost nearly 1.25% after hitting its historical high at 3739.31 last Friday. Tech-heavy Nasdaq 100 futures of Wall Street fully wasted last week's gains, sliding from rather comfortable levels above 20,000 to the middle zone of a lower 19,000 big figure. The S&P 500 broad market barometer dropped below 5,700. The crowd may become more cautious while Middle East tensions are clearly escalating. However, it may feel already on the next step that the proper way to hedge additional risks lies in hiding even more cash into leading stock assets instead of U.S. Dollars or Euros, especially as yields of Treasury bills and German bunds are going further down very fast in sync with lower central banks' interest rates.

Military standoff between Arabs and Jews can last for years, trying to enlist other sides into the conflict. This only undermines the U.S. government influence in the region, as well as the commonly cited "international order based on rules", which negatively affects reserve currencies' system. Meanwhile, the capitalization of major transnational corporations may even benefit from pure investors' desperation mixed with instinctive reactions. If Apple and some high-rating chip stocks lost 3% to 4% of its value in one evening on October 1 then Google, being the search and cloud giant far away from sales of any physical items, is still on its feet, even gaining 0.7% during the day, while social networks prince Meta used the stressful moment to soar to its new all-time milestone above $583 per share. The Facebook, Instagram and WhatsApp owners' one-year change in value is more than 85%.

We believe that such trends will continue strongly in October, and so adding more positions in market indexes and leading techs, be it on their current highs or dips, is an appropriate stance. Besides, we would like to draw your kind attention to a fresh analyst note from The Bank of America mentioning in particular: when the S&P 500 was up in September, the rest of the same year has had even stronger returns with the index being "up 67% of the time on an average return of 1.62% (1.54% median) in October and up 79% of the time with an average return of 5.08% (5.81% median) in 4Q", supporting the idea of the 6,000 target area for the S&P 500 into year-end.

September is typically the weakest month of the year for the S&P 500, but this time the index added 2% to reach a year-to-date gain of 20.81%, which may set the stage "for a potentially robust fourth quarter", according to the BofA's bets. Its investigation said, when the S&P 500 statistically was up between 15% and 25% through the first three quarters of a year then the S&P 500 later would have an average last quarter gain around 4.4%. In 2024, this would lead to potential goals between 5,930 and 6,185. Again, any solid gains during a presidential election year "bodes well the S&P 500", with "a positive Q4 is seen 89% of the time", while an average return is 4.98%".

With more eyes are going to watch the U.S. September's jobs report, scheduled for this Friday, the Federal Reserve's head Jerome Powell reiterated that the open market committee doesn't feel "like it’s in a hurry to cut rates quickly", so that further rate cuts may "play out over time". His latest statement was made before the Middle East new tensions, which could accelerate the central bankers' dovish mood to offset growing risks for the global economy. Yet, even a smaller 0.25% policy change in early November, compared to the large 0.5% step down two weeks ago, looks to be an adequate response of monetary authorities to expectations of the investment community on improving borrowing conditions in nearest months.