Last night Asian markets sold off big time, following the lead of the US markets. The Tokyo market hit a 5 year low on negative sentiment plus the ¥ rose to the 97s (up from 110 to the dollar a few months ago). They are an export economy & their latest report showed net exports were close to even, not good for them. Hong Kong, Shanghai, Korean markets, etc. all are near multi year lows on fears about the global recession. Speaking of currencies, the € dropped to $1.28, lowest level in a couple years. The ¥ is seen as a safe haven currency while the € is not. Global trade is shifting dramatically which will impact US & foreign business.
Dow is up 102 & fading from higher levels today, advancers ahead of decliners only modestly & NAZ was about even. S&P 500 FINANCIALS INDEX is even, The Alerian MLP index & Dow Jones REIT index are little changed (resting a bit after big swings lately). The VIX (volatility index) is down 5 to "only" 64 in its heavenly world. Somebody pointed out that the VIX was higher than oil yesterday. Oil is up 2½ on talks of cutting back production while gold is down 28 to 705.
The markets are greatly oversold, once again. A relief rally is logical but so far there is no major conviction behind it. Bargain hunters are active but the breadth is not good, financials are still limping along & most importantly, lousy economic conditions keep dragging on.
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