Citadel Securities Sees Markets Shifting to ‘Demand Destruction’

The market fallout from the Middle East conflict is entering a new phase, with investors starting to shift their focus from the initial inflation shock to the hit on global economic growth, according to Citadel Securities.

The transition toward weaker activity and “demand destruction” could support longer-term inflation-adjusted bonds, strategist Frank Flight wrote in a client note Monday. At the same time, call options on the US dollar offer “attractive asymmetric” protection against further escalation in Iran, he said.