The markets today must reconcile two primary opposing factors. On the one hand, global economic statistics and earnings pre-announcements describe a listless global economy – not recessionary per se – but not healthy enough to really drive revenues and confidence. On the other hand, the globe’s major central banks have all committed to indefinite and unlimited monetary stimulus.

So, our punch-counterpunch market has now entered the later rounds evenly scored. Breaking the stalemate between economic deflationary forces and central bank inflationary forces may require third party assistance. U.S. fiscal policy direction and Chinese stimulus plans represent potential tiebreakers. Unfortunately, we are unlikely to gain clarity on either factor until both nations complete leadership transitions. China’s changing of the guard will occur at their Congress late next month while the U.S. hits voting booths in early November. Between now and then we must endure what should be an uninspiring third quarter earnings season. The backward looking results occurred without full central bank policy support, telling us little about the current environment. The forward-looking comments cannot incorporate the impact of unknowable U.S. election results or Chinese stimulus effectiveness. Therefore, absent a surprise, this market is temporarily closed for business.

Macro Roundup

Let’s review the performance scorecard for the closing third quarter, and identify the protagonist for the fourth quarter.

First, the geographic perspective. Thanks to bold leadership from the European Central Bank, the European equity markets led global returns. Similar stimulus at home drove U.S. markets into second place. While Asia and the emerging nations participated in the rally, their conviction was low due to the murkiness of the Chinese environment. If China announces bold stimulus in the fourth quarter, they could vault from last to first like the Europeans and pull their emerging market vendors along with them.

Second, let’s review currency returns. The “Hard” currencies or those tied to commodity producing nations like Canada, rallied strongly on global money printing. In Europe, commitment to the euro eclipsed the dilution effects of more euros, leading to a nearly 4 percent rally. Conversely, the U.S. dollar lost 4 percent. FYI, those who predicted European collapse: the euro has now gained .3 percent against the dollar in 2012.

Lastly, the sectors that should benefit most from easy money policies include those whose products price in dollars, namely materials and energy. While energy names advanced over 10 percent, materials names trailed the broader index. Why? Well, energy markets make a purer bet on quantitative easing as oil supplies barely meet oil demand. However, while materials mostly price in dollars like oil, the economic environment heavily influences performance. Materials would receive a more meaningful boost from Chinese fiscal stimulus aimed at stimulating economic activity compared to the boost received from U.S. monetary stimulus aimed at stimulating asset prices. In the fourth quarter, the stock markets will likely turn toward material names for leadership as they provide instant commentary on new political leadership in the U.S. and China. Could be a November to remember!

David Waddell, who is regularly featured in the Wall Street Journal, USA Today and Forbes, as well as on Fox Business News and CNBC, is president and CEO of Memphis-based Waddell & Associates.