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A sharp midday sell-off left some “at a loss” for words for a particular catalyst.  Maybe it wasn’t just one thing, but rather everything.First, the scoreboard:

Dow: -134.8 pts, -1.1%
S&P 500: -20.6 pts, -1.7%
NASDAQ: -51.6 pts, -2.0%

And now, the top stories:

  • First, it was Greece.  Then it was Italy.  Now everyone’s talking about Spain and France, and that pattern stinks of contagion.  Earlier today, Spain had a horrific 10-year bond auction, where its borrowing cost soared to a staggering 6.975%.  France also held a bond auction this morning that didn’t go much better.  However, based on the country’s sovereign debt spread against German debt, people should be worried.
  • Yesterday, Greek and Irish leaders suggested that the European Financial Stability Facility (EFSF) in its proposed leveraged form could prove inadequate in stemming the eurozone debt crisis.  Some are hoping for some relief through aggressive ECB intervention.  However, Germany has been an outspoken opponent of this. “If politicians think the ECB can solve the euro crisis, then they are mistaken,” German Chancellor Angela Merkel told Reuters today.
  • There was even a rumour that the ECB might funnel money into the EFSF via the IMF.  But that confusing rumour was quickly denied.
  • Let’s not forget about domestic debt problems and political turmoil.  There are concerns the the U.S. congressional super committee will fail to come to an agreement on a $1.2 trillion deficit reduction plan before the November 23 deadline, which is now less than a week away.
  • U.S. economic data continues to come in better-than-expected, albeit a little anemic.  Weekly jobless claims declined to 388k, which was better than the 395k expectation. October building permits and housing starts both came in stronger than expected.  The Philly Fed survey came in at 3.6 reflecting expansion, but the number fell short of expectations.
  • Despite the somewhat positive economic data, it was a total risk-off trade today with an across-the-board sell off in commodities.  Copper and crude oil each fell more than 3%.  Corn fell 4%.  Even gold, the on-again off-again safe haven, got dumped, falling 3%.
  • Also reflecting the risk-off trade, the 10-year note fell below 2% and the 30-year bond fell below 3%.
  • The Nasdaq underperformed the other major U.S. indices today.  NetApp and Applied Materials had unfavorable things to say about earnings and their shares plunged.
  • Jefferies made headlines again today, selling off midday.  Fox’s Charlie Gasparino reported that competitors were poaching clients.  CEO Richard Handler expects the fear will soon recede.  The stock closed down 2.2%.
  • Meanwhile, the drama at Occupy Wall Street intensified today.
  • Don’t Miss: A Complete Guide To Surviving A Lost Decade

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