The key US stock market indices - Dow Jones, NASDAQ, and S&P 500 - ended Wednesday with a new fall. From our point of view, a market decline at this time is the most likely scenario. We still do not understand what caused the market growth in the last 2 to 3 weeks, but the fact remains that there are no good reasons for the growth of stock indices and US stocks right now. This week, several speeches by representatives of the Fed have already taken place and all, as one, said that it is necessary to fight inflation in more radical ways than was originally intended. Now almost no one doubts that the key rate will be raised by 0.5% at the May meeting at once, and the large investment bank Goldman Sachs said that in June the rate will also be raised by 0.5%. In addition, what is even more important than a rate hike, in May, most likely, the unloading of the Fed's balance sheet, which currently stands at almost $ 9 trillion, will begin. This means that the "anti-QE" program will begin. Now Treasury and mortgage bonds will not be bought up by the Fed but sold off. It is easy to guess that if the purchase of securities was a stimulating step, then the sale of securities will be a tightening step. Consequently, we get a new factor of the fall of all risky assets.
Meanwhile, the geopolitical conflict in Ukraine is undergoing a stage of preparation for new battles. As we have already said, the Russian army has left the Kyiv, Chernihiv, and Sumy regions and, according to American intelligence, the Kremlin is going to concentrate its forces only in the East and South-East of Ukraine. Therefore, there is no doubt that the map of military operations will simply move now to the specified regions. Mariupol is holding out with the last of its strength, the bombing of Nikolaev continues, although the AFU managed to push Russian troops to the border with the Kherson region. Nevertheless, the Kremlin will probably try to seize Nikolaev. If this happens, then there is no doubt that there will be an attempt to capture Odesa, which can be taken from three sides at once: Transnistria, Nikolaev, and the Black Sea. Thus, in the near future, military experts expect an escalation of the military conflict, and it seems that everyone has already forgotten about the peace talks. At least over the past week, there has been no news regarding communication between the Ukrainian and Russian delegations. As we expected, the parties could not and will not be able to agree on the Crimea and Donbas, therefore, until the position of one of the parties changes dramatically, there is no point in counting on the imminent completion of the "special operation". The whole situation in Ukraine is increasingly moving into the "Donbas 2.0" stage, only the front line will now be much longer, almost all over the eastern part of Ukraine.
