Good morning contrarians! The weekend was marred by the hostilities in the Middle East. As expected, this has led to risk-off across the board, though perhaps not (yet) with the magnitude that might be appropriate. As can be expected, defense industry stocks $LMT, $NOC, $RTX, and $GD are the biggest gainers among S&P stocks this morning.

There is a ton of speculation out there on the internets, none of which The Contrarian is qualified to weigh in on. For our purposes it’s just worth pointing out that markets hate uncertainty more than they hate bad news. As long as there is no visibility of a possible endgame in what is being called a full-fledged war by both sides, risk appetite will be hard to come by. This means shaky stock markets, higher oil prices, and probably a rally in bonds amid a flight to safety.

In light of that the movement in asset prices so far looks quite benign. More here, including a free audio clip from The Bottom Line segment of today’s podcast: