LIVE MARKETS-But what about the difficult questions?

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BUT WHAT ABOUT THE DIFFICULT QUESTIONS?

Stock markets have lurched higher on optimism about the Iran war potentially ending soon. But as is easy to do, markets might be falling into the trap of pushing uncomfortable thoughts aside.

“The one thing that kind of stands out from the price action that we've seen over the last kind of day or two is that the market has almost, not forgotten about, but is kind of trying its best to ignore the somewhat difficult questions,” Michael Brown, senior research strategist at Pepperstone, said.

Those include how high inflation could go, how much growth might slow, and what central banks may do, he pointed out.

“The market's almost trading solely on the idea that, peace is good, war might be coming to an end, let's buy risk,” Brown said. “Is that a little bit short-sighted? Potentially.”

Eventually, he said, markets will need to deal with the difficult questions – and that shouldn’t be forgotten just because headlines suggest the conflict may end.

(Sophie Kiderlin)

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