It is an interesting market at the moment which although quiet has some very aggressive underlying volatility. Take gold and the ags for example – time to make sure you keep stops close.
Anyway the retreat of stocks continued overnight with the wave of HSBC and Market PMI disappointing around the world. China kicked off yesterday with a print of 48.1 for the Flash PMI before disappointing outturns from Europe and the US.
In the grand scheme of things though, US stocks were fairly bad and at the close the Dow was down 9.16%, the Nasdaq is off 1.18% as biotech gets hit again and the S&P 500 is off 0.49% to 1857.
In Europe it was more of the same with stocks lower. The FTSE fell 0.6%, the DAX lost 1.7% while the CAC dropped 1.4%.
Locally on the ASX Futures market overnight the June SPI 200 contract dropped 33 points to 5315 bid.
On currency markets the US dollar lost more ground which is somewhat inexplicable but perhaps it was comments in the Press by San Francisco Fed President Williams that global FX markets the US dollar somewhat inexplicably gave up more ground allowing the Euro to recover 1.38 to sit at 1.3838 this morning. Sterling is sitting at 1.6502 and USDJPY is at 102.22. The Aussie dollar is stronger once again back at the recent highs sitting at 0.9128 this morning.
On commodity markets, Nymex crude is just below $100 Bbl at $99.57, copper sits at $2.99 lb while gold was hit hard falling around $25 oz to $1311 – a huge fall from recent highs. On agricultural markets there was more volatility with corn up 2.4%, wheat rose 3% and soybeans were 1.19% higher.
On the data front German IFO will be important tonight along with CPI and PPI in the UK and US home sales and the Richmond Fed
Greg McKenna is currently away in New Zealand attending a conference and today’s piece is his quick wrap of the markets.