16.03.2022 – Traders, pay attention: The next few days will be decisive. Experts assume that Russia will lose the war. In case of a ceasefire under Ukrainian victory sign or even an expulsion of the Russian army, a mega bull market is in the offing. Or else a Nero order from Vladimir Putin.
Up or down – if Russia really loses, either a celebration of joy or a world conflagration is possible. For as soon as Putin realizes that his plan for the reconstruction of a Greater Russian Empire has failed, anything would be possible for him. If you want to know which thinkers have influenced the Russian president, you should read up on Alexander Denikin (general with the Whites in the Civil War) and Alexander Dugin (co-founder of the now banned National Bolshevik Party). In the event of a poison gas attack or a nuclear strike by Russia, as well as a revenge attack on a NATO country like Poland, the major indices are likely to easily plunge by double digits in one day. And the nice little DAX relief rally of the past few days (target: 200-day line) in the hope of a settlement of the conflict is history.
And with that, we turn to the forecasts mentioned at the beginning. The always readable “Tichy’s insight” first quoted General Waldemar Skrzypczak, former head of the Polish land forces. He told the news magazine “wPolityce” that the Russians had already lost the war. Their army was demoralized, and out of despair they were killing civilians. The Russians bombed Kiev to break the Ukrainians’ will to defend themselves – they had “gone over to terror warfare” and wanted to bomb Ukrainian President Volodimir Zelensky to the negotiating table.
To the west of Mikolayiv in southern Ukraine, the Ukrainians had crushed a combat group of the Russian army. The same had happened in the northeast south of Ochtyrka. The Russians would have run out of operational reserves. Syrian mercenaries had no fighting power; Russia could not count on the Belarusian army – then there would be a threat of an uprising in Belarus. Furthermore, Belarusian soldiers could defect to the Ukrainians.
China probably changes sides
The magazine also refers to China. Hu Wie, head of the “Central Institute of History and Culture”, has analyzed that Moscow is not able to achieve its strategic goals in Ukraine. The blitzkrieg had failed. Moscow’s only option now is peace negotiations. The geostrategic consequences: The conflict could escalate, and perhaps the West would intervene after all. Moreover, Russia does not have sufficient means to control Ukraine militarily. The sense of defeat could lead to Russia’s destabilization. The U.S., on the other hand, had regained its leadership position in the Western world. The strength of the West is increasing overall. Thus, Hu Wei now sees the danger that China could end up isolating itself economically (and politically) if it were to tie itself too closely to Russia.
Our conclusion: If all this is true, we are in for hot days. Mega bull market, if the Russian leadership agrees to a compromise and the guns stay silent. Or super bearish if Moscow escalates. Bernstein Bank keeps an eye on the situation for you!
Important Notes on This Publication:
The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice. CFDs are complex instruments and are associated with the high risk of losing money quickly because of the leverage effect. 83% of retail investor accounts lose money trading CFD with this provider. You should consider whether you understand how CFD work and whether you can afford to take the high risk of losing your money.7