Following are a number of views and opinions from commentators around the world, which we hope will make the task of managing your clients a little easier.

• The most obvious is perhaps the fact that, in any event, there is fundamentally little that can be done in the short run. The world can only practice patience as it waits for the reopening of the US Equity markets on Monday night (NZ time). Since the tragedy on Tuesday, European, Asian and Canadian markets initially closed up but at the end of the week closed markedly down. There is no clear view on what will happen on Monday night apart from the fact that we all remain apprehensive observers.

• A huge effort has been made to ensure that when the New York Exchanges do open, a reliable infrastructure will be in place to ensure orderly trading. Nonetheless, we need to consider some of the practical underlying issues:

• The New York Stock Exchange is surrounded by a city filled with emergency vehicles and rubble; the trip to work alone is likely to open a floodgate of emotion for the people on the trading floor.

• The local phone company servicing the NYSE lost a significant portion of its lower Manhattan network when the World Trade Centre collapsed. Officials believe that services will be back to normal on Monday; however, any surplus capacity relied upon during peak times is likely to be in short supply.

• Dozens of trading companies and market markers, Merrill Lynch, Lehman Brothers, Barclays, etc, have Manhattan office space that was not destroyed, but is still unusable. While disaster recovery programs are in play and temporary office space has been established, it is fair to surmise that the operating infrastructure will not be as robust as under normal trading conditions.

• Daily transportation of workers to and from the financial district will have to be re-established. Simply getting people to work on Monday will be challenging. The World Trade Centre served as a major transportation hub – many of the commuter trains from New Jersey no longer have a terminal in Manhattan.

• All of this means that while we must all wait for Monday night’s trading, there are a huge number of extraordinary influences that will impact the result. Clear thinking and good advice for your clients will emerge after many weeks and many trading sessions. Monday night is by no means the end to uncertainty – it is only the beginning of a long period of careful evaluation and assessment.

• For investors seeking comfort in history, the following facts follow on from the data provided in TOWER Managed Funds Update (1) issued on Wednesday 12 September.

• When acts of war are considered: During the time immediately after Pearl Harbour, the Dow Jones fell approx. 7% in two days. After six months, it was down 10%. Following the Iraqi invasion of Kuwait, the Dow Jones fell 2% on the first day, 9% over the first month and after six months it had recovered to 4.6% below pre-war levels.

• When acts of terrorism against the United States are considered: The Dow Jones fell 0.5% after the first attempt to bomb the World Trade Centre and then rose 8% after six months.

• When natural disasters are considered: When Hurricane Andrew (1992), the most expensive natural disaster in US history ($20-$25 billion), hit, the Dow Jones rose slightly the day after and finished up 4% after six months. After the Los Angeles earthquake in 1994 (causing $15 billion in damage), the Dow rose slightly and then slipped 1.7% over the following six months.

• There is a growing view that in light of the deliberate attack on the US, national patriotism will prevail on Monday night and prices will rise in a sort of defiance of the prospective implications for recession. While unconfirmed, there are indications the US Securities regulator, the SEC, will temporarily relax rules to allow companies and market makers to buy stock.

Cisco Systems (Nasdaq) have indicated the potential for a share buyback to the value of US$3 billion. However, the emotion must be considered in light of the facts – Ford issued a profit warning late on Friday in the US and General Electric expect US$400 million in after-tax reinsurance losses, leaving its September-quarter earnings well short of analysts’ estimates.

• Tuesday morning (NZ time) will bring a lot more information. We will keep you up-to-date on movements on trading and numbers as soon as they become available on Tuesday. You can also monitor events first-hand at www.nyse.com and www.nasdaq.com.

This newsletter was written by Tower Managed Funds on Sunday September 16.