Whataday! If you’re a bull in this market, light a big cigar right now.But first, the scoreboard:
The S&P 500: -2
And now, the top stories:
- The day really began at 3:30 PM ET yesterday, when Irish PM Brian Cowen announced that Ireland has formally requested a bailout from the EU and the IMF. Details were scarce, and we were immediately sceptical that markets would be real keen on the news.
- But initially markets were in fact enthused by the news. The euro shot up in early Sunday evening trading. S&P futures surged. The Nikkei soared. All good. Of course, some cracks started appearing right away. Hong Kong opened lower thanks to increased concerns about property tightening.
- By the time the very early hours of the morning rolled around, the euro was still up, but China had slipped, and the gains seen in Irish equities and bonds were fading. Industrial commodities were also sliding. The dollar was starting to make more headway, once again.
- Then things really hit the skids in Ireland. Thanks to the wrenching decisions the country is about to make, the government is crumbling. First it was the coalition Green Party that announced it would only stick around until January. Then a number of independent and other Brian Cowen party-mates said it was time for new elections.
- The mood turned sharply risk off. Ireland fell hard. Irish bond yields climbed back above 8%. There were so many rumours about the imminent collapse of the government, and Cowen’s possible resignation, that by 2:00 PM ET, the Taoiseach was forced to hold a press conference to announce that he wasn’t stepping down. After the budget and a four-year plan, however, the Dail will be dissolved early next year, and new elections will be called.
- Meanwhile, there was major financial industry drama in the US… after a Friday report that the government was close to bringing sweeping insider trading prosecutions to hedge funds, the Feds raided two Connecticut hedge funds, both of which were started by ex-SAC employees. A third raid was announced shortly thereafter. Goldman Sachs fell hard on the news. Click here to see the worst insider trading busts of all time >
- But… after all that was thrown at it, the market hung around, never washed out, and ended where it did, which represents a pretty stunning loss for the bears. Bear in mind, at one point the Dow was down over 100 points, and all the major indices were off over 1%.